Thursday, 4 October 2012

Hollywood Babble On & On #958: Killer Diller Strikes Again

Barry Diller the current internet mogul had a little flashback to his time as a studio boss when he said that a lot of today's movies "kind of stink."

For those too lazy to click the link I'll give you some background, then I'll talk about his comments.

Diller got his start in Hollywood through "White Man's Affirmative Action" using a family connection to get a job in the mail-room at the William Morris Agency after dropping out of college. From William Morris he jumped to a job as an assistant to Elton Rule, an executive at ABC just before Rule was promoted to run the whole network.

During his time at ABC Diller worked in negotiating broadcast rights for feature films. The hassle of dealing with the studios for their movies inspired Diller to create the ABC Movie Of The Week, where the network regularly produced and broadcast their own 90 minute movies.  Diller then went on to become CEO of Paramount Pictures for ten years, and eight years running 20th Century Fox, where he founded Fox Broadcasting, then the USA Network, before mostly dropping out of Hollywood to be Chairman of Expedia and IAC/InterActive Corp an online business conglomerate.

So while you may dispute specifics of Diller's comments, you really can't dispute that he comes from a place of experience.

In fact this isn't the first time I've written about Diller's barbed tongue. Back in the misty fogs of 2008 I wrote about Diller complaining about how narrow the Hollywood executive community had become saying:
“It’s a community that’s so inbred it’s a wonder the children have any teeth.”
He was right then, and he's right now.

The main crux of Diller's "movies stink" argument is that there are only a handful of studios dominating the market, and that those studios are just small cogs in huge multinational multimedia conglomerates.

Theatrical feature films are in a vicious death spiral. The studios believe that there is no problem that can't be solved by throwing money at it, and using every trick in the book to make sure that their partners don't get their share of any profits.

Prices go up, profit margins go down, and the studios panic. They put all their eggs into the basket of the "mega-blockbuster" that's loaded with product placement and merchandising deals, and the promise of profits from foreign markets like China.

Except not everyone wants to see the big mega-blockbusters, also foreign audiences are more fickle than North America's and the studios share of the ticket price, called the "rental," varies wildly from country to country, and usually doesn't come near what they get in North America.

So audiences are dwindling, gaps form in the marketplace, but the studios are so dominant, they make it next to impossible to anyone else to fill.

Ironically, Diller, was himself a pioneer in the field when he branched 20th Century Fox into network television. After that every studio started to covet a piece of the TV pie, and followed suit. Universal merged with NBC, Paramount & CBS were brought together by parent company Viacom, and so on and so on.

So if he wants to look at the roots of this problem, he should probably look in the mirror.

The whole industry needs to be reformed from the top down if it's going to become the flagship of popular culture again.

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