Welcome to the show folks....
MGM got the forebearance it was asking for, landing a stay of execution until January 31, 2010. The forebearance is basically where the holders of MGM's crippling debt accept a temporary freeze on repayment while a plan is put together to make the company a viable movie studio again.
I've been dabbling in what to do with the company for quite some time, and I think I've come up with my own plan. I'll gladly implement it as the new CEO of MGM, and I'll do it for half the salary and perks of a typical Hollywood CEO in exchange for a piece of the action.
Anyhoo, here it is...
1. Swap debt for ownership. Right now every penny that comes into MGM goes to paying off the debt, and most of that goes to paying off interest. This constant outflow of cash is severely hindering the company's ability to raise fresh capital and produce new films and TV shows to make the sort of money needed to make the company viable again. I suggest that this debt be either purchased and/or consolidated, then traded for ownership in the company. The debt-holders aren't going to get the sort of money they need if the company is stripped for parts and auctioned off. It's in their interest to get the company back on its feet and producing again, so they can see some real dividends.
2. Sell off MGM. Now you're probably think I'm nuttier than a squirrel turd by saying that they shouldn't sell MGM, then I go off and say that yes they should sell MGM. I'm not crazy, I do have a plan. You see MGM is a brand best associated with classical movie history, it's not a brand associated with the sort of fresh, vital entertainment audiences will line up in front of theatres to see.
What I'm talking about is selling off the MGM name, to someone who might be able to do something with it, namely Time-Warner who currently own the "golden age" MGM library and might be willing to drop a few shekels for the complete package. The remaining company wouldn't be nameless, I suggest restructuring the company to be reborn as a new United Artists company. United Artists has been moribund so long it's pretty much a whole new brand to most moviegoers.
3. Run a tight ship. Most studios have too many cooks in their kitchen. A revived MGM/UA needs to be lean and mean to keep its costs down, not only at the head office, but in production as well. Reward prudence, punish waste.
4. Find partners. There are many people and businesses who want to invest in the movies but have either given up, or were driven out by the behavior of the major studios. They're sick and tired of seeing the films they invest in becoming big hits, only to be told that their money has gone up in smoke thanks to funky accounting and immensely bloated corporate overheads. Now how do you deal with these production partners? Straight. If the film makes money, then everyone involved makes money, it's simple business. Do the impossible, make movies that actually have net profits.
This will also attract independent filmmakers and producers looking for a distributor who will treat them with a certain amount of decency.
5. Foster fresh talent. Hollywood is in a state that's eerily similar to the one it was in during the late 1960s. They were executive heavy, with an old guard that pursues hipness, and usually fails. This new UA must be open to new talent and train them in a philosophy that they don't need to break the bank to make a simple movie, they just need a decent imagination.
In the 1960s this talent was developed under Roger Corman and American International Pictures. A new UA could fill this gap by creating a production division aimed at filling gaps in the market with lower budget films, and put someone with a sharp eye for talent in charge.
6. Keep the Bond franchise, kill the Pink Panther remakes. 'Nuff said.
Anyone with other suggestions should feel free to leave them in the comments.
MGM got the forebearance it was asking for, landing a stay of execution until January 31, 2010. The forebearance is basically where the holders of MGM's crippling debt accept a temporary freeze on repayment while a plan is put together to make the company a viable movie studio again.
I've been dabbling in what to do with the company for quite some time, and I think I've come up with my own plan. I'll gladly implement it as the new CEO of MGM, and I'll do it for half the salary and perks of a typical Hollywood CEO in exchange for a piece of the action.
Anyhoo, here it is...
1. Swap debt for ownership. Right now every penny that comes into MGM goes to paying off the debt, and most of that goes to paying off interest. This constant outflow of cash is severely hindering the company's ability to raise fresh capital and produce new films and TV shows to make the sort of money needed to make the company viable again. I suggest that this debt be either purchased and/or consolidated, then traded for ownership in the company. The debt-holders aren't going to get the sort of money they need if the company is stripped for parts and auctioned off. It's in their interest to get the company back on its feet and producing again, so they can see some real dividends.
2. Sell off MGM. Now you're probably think I'm nuttier than a squirrel turd by saying that they shouldn't sell MGM, then I go off and say that yes they should sell MGM. I'm not crazy, I do have a plan. You see MGM is a brand best associated with classical movie history, it's not a brand associated with the sort of fresh, vital entertainment audiences will line up in front of theatres to see.
What I'm talking about is selling off the MGM name, to someone who might be able to do something with it, namely Time-Warner who currently own the "golden age" MGM library and might be willing to drop a few shekels for the complete package. The remaining company wouldn't be nameless, I suggest restructuring the company to be reborn as a new United Artists company. United Artists has been moribund so long it's pretty much a whole new brand to most moviegoers.3. Run a tight ship. Most studios have too many cooks in their kitchen. A revived MGM/UA needs to be lean and mean to keep its costs down, not only at the head office, but in production as well. Reward prudence, punish waste.
4. Find partners. There are many people and businesses who want to invest in the movies but have either given up, or were driven out by the behavior of the major studios. They're sick and tired of seeing the films they invest in becoming big hits, only to be told that their money has gone up in smoke thanks to funky accounting and immensely bloated corporate overheads. Now how do you deal with these production partners? Straight. If the film makes money, then everyone involved makes money, it's simple business. Do the impossible, make movies that actually have net profits.
This will also attract independent filmmakers and producers looking for a distributor who will treat them with a certain amount of decency.
5. Foster fresh talent. Hollywood is in a state that's eerily similar to the one it was in during the late 1960s. They were executive heavy, with an old guard that pursues hipness, and usually fails. This new UA must be open to new talent and train them in a philosophy that they don't need to break the bank to make a simple movie, they just need a decent imagination.
In the 1960s this talent was developed under Roger Corman and American International Pictures. A new UA could fill this gap by creating a production division aimed at filling gaps in the market with lower budget films, and put someone with a sharp eye for talent in charge.
6. Keep the Bond franchise, kill the Pink Panther remakes. 'Nuff said.
Anyone with other suggestions should feel free to leave them in the comments.
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ReplyDeleteDear "Bullioninvestor" if that is your real name. From your tactics of leaving unrelated spam in blog comments I can only assume that you are part of some sort of scam, because no legitimate business would do such a thing.
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Interesting thoughts, D, but I think the selling the MGM name is a non-starter. For one thing, I don't think the ordinary movie-goer cares who the studio is. As you point out so often, they just want to be ebtertained. That's why some movies do well and others don't. Whether it says MGM, Fox, or "Joe Blow movie makers" is just something that comes up in the first 30 seconds.
ReplyDeleteOn the other hand, the transferring of debt for ownership is a good idea, and also something that happenes in a Chapter 11 bankruptcy.
By the way, it's good to see you back.