Tuesday, 10 August 2010

Hollywood Babble On & On #573: Stubborness Can Be Expensive Too

Welcome to the show folks....

Yesterday I wrote about how perception can cost you money in Hollywood. Today, I'm going to talk a bit about how being stubborn can also cost you money.

A classic case of the bull headed thinking costing money is what's going over at mini-major Lionsgate Entertainment. They reported a nasty loss in the last quarter, caused mostly by the failure of the Ashton Kutcher / Katherine Heigl
Killers, and the $30.6 million they spent fighting with take-over maven Carl Icahn.

Think about that.

$30.6 million spent fighting Carl Icahn.

It doesn't matter what you think of Icahn, his business, or his methods, $30.6 million should not be spent in a spat that could have possibly been avoided. Lionsgate doesn't have a parent company with deep pockets like the uber-majors. They can't afford to get into a fight with anyone, especially one that distracts them from what is their prime mission, which is making, marketing, and distributing movies.

When you can't afford a fight, you must do what you can to avoid a fight.

Icahn can't just swan in and start a fight, he needs reasons to woo shareholders to his side. Those reasons are his ammunition.

He claims that current management aren't doing enough for shareholder value.

That means you have to buckle down, control budgets, and above all do not, I repeat DO NOT, green-light a big budget movie casting Ashton Kutcher as a globetrotting secret agent.

Icahn demands a seat on the board, and since he is a major shareholder, he probably deserves one. So give it to him. If you can't handle a board member that disagrees with you from time to time, then you seriously need to rethink your career in high management.

Word is that Icahn wants the company for his son. Bring in the kid. I know that sounds counter-intuitive, but hear me out.

I don't know anything about the junior Icahn. He's not in any tabloids, or on TMZ, etc... as one of the many celebutard heirs and heiresses dripping all over the internet. That at least earns him the benefit of the doubt.

So here's the plan.

Bring the kid into the company.

Work his ass off.

Give him the hardest, nastiest, least glamorous jobs you can find. Send him to talk the neurotic actress off the roof of her trailer, have him sort out the Teamsters, and all those other pain in the ass duties that need to get done, and do not get taught in any business school.

If he has any talent for the work, exploit it, and groom him as a possible heir apparent when the time comes to retire to one of those producer deals, but use him to get one where you actually get to produce stuff. If he doesn't work out, show Daddy Icahn that he doesn't cut the mustard, or he'll run screaming from it all by himself.

If it doesn't work. Then it all look like Icahn's fault, and not yours, and you avoid pissing away $30.6 million just to maintain a stalemate, where you're bleeding faster than your opponent.

Don't be stubborn, be strategic.

1 comment:

  1. $30.6 million spent fighting

    The only way 30+ million should be spent on a fight is if it involves Scarlett Johansen and Alyson Hannigan fighting in pudding dressed in solid gold slave Leia bikinis.