The Hot Button
The Hot Button
THB #86: Smiling Faces

THB #86: Smiling Faces

Who would imagine that Carson Kressley, not Yoda, would inspire today’s column? The lifestyle icon was on Celebrity Big Brother and turned on a friend because another friend he trusted just slightly more lied boldly to his face.

From the outside, young Carson wrote, “Like @juliechenmoonves said, I should have trusted actions over words and I learned a valuable life lesson.”

I won’t get into whether the existence of the hashtag he cites suggests that its owner may be living the opposite. But I am a great believer in this idea… trust action over words.

Things can get very dicey very quickly when this idea is angrily exchanged with someone who is smart enough to evade the basic concept. For instance, interpreting actions to match words one wants to believe rather than having a clear-eyed view of said actions.

In a relationship that one partner wants too much for their own good, the old “lie even if they catch you in bed with another person” infidelity jokes become real when the partner being cheated on doesn’t really want the relationship to end. They will find a way to bring truth to the lie their partner is offering, even if they see it with their own eyes, sometimes in their own bed.

Don’t even get me started on Donald Trump, who found that a full third of America wants to be lied to aggressively, so long as the massive lies compliment their ongoing view of the world.

Democrats don’t get off on this charge either. Bill Clinton wagged his finger at us all and said he did not have sexual relationship with that 20something girl who performed sex acts on him in a side room off the Oval Office. And Democrats and Feminists, in large, forgave him.

I don’t want to set up a false equivalence. Trump was far more reckless and abusive - if not fully criminal - than Bill Clinton. But that’s not my point. (And again, another oportunity to avoid undeniable truths because they are uncomfortable.)

As I watch the media and Wall Street and industry folks who are anything but fools flailing like poor swimmers in a riptide, trying to keep up with the weekly rounds of “who is winning… who is dying?” discussion of this industry at this moment, I keep coming back to this basic schoolyard idea.

Trust what they do, not what they say.

It has led me astray a few times over the years. Sometimes the details don’t line up with the results. Those are always fascinating stories, usually told (to me, at least) years after the fact. But really, the percentage of accuracy looking at the world this way is over 90%.

The Paramount situation involves many thousands of people, dozens of divisions, and a million tiny unknowns. A few hits used to be able to turn around a broadcast network. Maybe 10 significant hits a year is really all you need to supercharge a streamer.

But let’s look at what Paramount has done, in all of its carnations, since the Redstone family took over in 1994. In that same year Redstone’s Viacom bought Blockbuster Video. In 2000, Netflix offered to sell to Blockbuster… and Blockbuster passed.

The next 5 years were pretty quiet. In 1999/2000, Viacom bought CBS, which had recently reacquired NFL rights, and also included then-syndication-giant King World. In 2002, Viacom took over Infinity Radio.

So what do we see in the 1994-2004 period? A lot of aggression… but often in buying companies nearing the top of their game, meaning they would soon be headed on their way down the hill.

Still, the company was relatively stable. Too stable for Sumner. Stock price wouldn’t budge. With the decision to split CBS and Paramount in 2004, out went Lansing & Dolgen, in came Brad Grey. Within a year of his entrance (Dec 2005), Grey outsourced the film side of the company, essentially, to DreamWorks, spending $2.4 billion (including a delayed payment of $900m for the 59-film library) on the deal. Grey failed to get DreamWorks Animation under the Paramount banner.

A year after DreamWorks landed at Paramount, Redstone dumped Tom Cruise, who was a major presence at the studio. There was a dispute over Mission: Impossible 3 and with DreamWorks in place, it seemed that Paramount was set with high profile titles.

Team DreamWorks exited Paramount almost exactly 3 years after its arrival, as their deal allowed, and took the brand name with them.

Grey can also take credit for another good news/bad news story for Paramount that created revenue in the short term, but bit them in the ass long term. Marvel. It was Merrill Lynch that took on primary funding/lending position for Marvel to make its first films in-house. Universal failed to close the deal for distribution/marketing and Paramount swooped in and took it. Great. In May 2008, Iron Man arrived and outperformed all expectations. Paramount would have 2 of the Top 3 films of 2008 domestically (2 of 8 worldwide). But here was the problem… 10% on Iron Man for distribution/marketing and thanks to an insane deal with Lucas/Spielberg/Ford, just 12% of Indiana Jones 3 after breakeven, even having advanced all the funds itself.

Coming off Iron Man, Marvel reduced Paramount’s cut to 8%. Then, 18 months later, Disney bought Marvel for $4 billion.

So DreamWorks… DreamWorks Animation… Netflix… Marvel…

Paramount was also the launching pad for Jason Blum’s empire… they built an entire division for him and what he started with Paranormal Activity and then saw him exit, stage Burbank (first for Warners, then Universal).

It reminds me of when Brad Grey was looking for someone to run the movie studio and met with top execs from every other company, failing to land any of the choice ones, but getting almost everyone a massive contract increase wherever they were. That is Paramount.

My point isn’t (just) to make fun of Paramount/Viacom/CBS’s huge, huge misteps over the 27 years that the Redstones have owned the company. (CBS did pretty well during its spun-off years, under Les Moonves… which is why it was seen as so confusing when Shari Redstone pushed so hard for Moonves not to be in charge. The sex charges against Moonves will always have a chicken/egg quality, in terms of why they landed when and how they did. But that’s a whole book, really.) The point is… there is reason why, no matter what they talk about on an investor call, Wall Street doesn’t trust the ownership and thus, not the company.

And I haven’t even gotten into the much hated Philippe Dauman, who squeezed and squeezed Viacom instead of building it. Too ugly. Sparkling water under the bridge.

There have been great moments and great talent that have come through the Paramount machine over these last decades. I am not just Don Rickles-ing it. Some of my favorite people have worked there. There have been some great successes.

But when Bob Bakish comes in - stable, not exciting - and he hires Jim Gianopulos - stable, not exciting - then re-merges with CBS at a moment that doesn’t bring an excitement, then dumps Jim G for the kid from Head of the Class, whose big calling card was releasing PAW Patrol: The Movie to $40m domestic - insert your level of excitement - then finally gets a giant break from the industry gods with Yellowstone and every story is about how the distribution of the show is fucked up and helping Comcast, not Paramount…

Who the hell thought a bunch of announcements of how great things are going and are about to go when anyone who asks anyone outside of the business about watching Paramount+ gets a dead-eyed stare was going to get a big round of applause from Wall Street or anyone really?

It doesn’t matter what you say. It doesn’t matter what you promise. It is what you do!

“WAIT,” you scream! “What about Netflix? Wall Street always just believed them!”

Well, boys and girls… that is true.

But besides having first mover advantage, they have had “haven’t done any f-ing thing for decades to compare current actions to” on their side as well. And to be reasonable, Netflix has a strong track record of delivering on their promises. Lunatics, like “Always Wrong Rich” Greenfield have created all these fantasies about a world where Netflix is only currently reaching 20% of their potential households that have made the stock soar beyond logic. But you can’t really blame that on Netflix.

Netflix is the object of obsession and even when they lie blatantly, their “partners” want to believe that they are telling the truth. And Paramount is the one that gets thrown out of the house naked with all their stuff being thrown out the 2nd floor window.

AND you can’t really blame the fact that Wall Street has never moved stock pricing much on the success of a movie or a series or such - or the failure, really - for decades. Legacy carries a lot of baggage and one of the pieces is this truth… Wall St just isn’t that into you. They want the shiny new object, loaded to the gills with faux promise. They would rather dream of the magic object that actually becomes real 1 time out of 10,000 than the stable, consistent winning object they use happily every day of their lives.

History tells us that Paramount Global will find a way to shoot itself in the foot.

History tells us that Paramount Global would rather hide in the saloon than be on the street at High Noon.

History tells us that Paramount Global will get into relationships with companies of rising power and then watch someone else harvest the sweetest part of the fruit.


History tells us that this can all change. Quickly.

This is not optimism. This is experience.

Paramount Global needs a story to tell… not the same one everyone else is telling.

Paramount Global needs a charismatic leader, who I assumed Brian Robbins was going to be… but if he is one, he better start showing himself. Jason Kilar gets more attention for his Instagram feed in a month of travel than Robbins has gotten since he took on his massive job.

Paramount Global needs an actual great plan. There is nothing wrong with bringing the South Park library back into the fold in 2025, but if that is the big story, you have no story. Sorry. (Not to mention, the release of the 2 COVID special hours, which were very good - if you like South Park - was ham-fisted like the worst experiences of Paramount ham-fistedness.)

“There are 106 miles to Chicago, we have a full tank of gas, half a pack of cigarettes, it's dark and we're wearing sunglasses.”

That’s it, Paramount! That’s how we all see you. You just left Princess Leia in the mud after she tried to kill you. Everyone is chasing you, from the police to the Good Ol’ Boys to the Henry Gibson neo-nazis. And if you can get to Chicago and get Steven Spielberg to open the office before they all get you, you win.

(apologies to people not familiar with The Blues Brothers… this has become an episode of Billions… sorry.)

Until tomorrow…

The Hot Button
The Hot Button
An inside perspective on the Film/TV/Streaming Industry from a 30-year veteran seeker of truth.