Monday, 10 August 2015

Hollywood Babble On & On #1246: Can Relativity Media Be Saved?

As a regular reader of this blog will know indie production company and distributor Relativity Media has filed for Chapter 11 bankruptcy protection because it has about $500 million in assets and about $1 billion in debt.

Can it be saved?

The answer is "Yes" but with caveats. It would have to meet certain conditions if it is going to have a second chance. 

1. Dump Ryan Kavanaugh. Sure, the Hollywood business press seems to love him, and he seemed to be really good at getting investors to pony up the dough for a while, but he still managed to rack up a hell of a lot of losses and debts in a whole variety of hare-brained schemes that were heavy on sales jargon but low on results. I know he's a major shareholder, but if former newspaper mogul Conrad Black can be forced out of two companies, one where he was the sole proprietor, on the basis of crimes that the appeals court ruled hadn't actually happened. If that's possible then you can get rid of Kavanaugh for driving the company into the ground.

2. Trim Fat/Find Money. One big problem the company has is that there isn't enough money coming in to service the debt and keep the company running. Naturally a selling off of assets will have to come. The sports agency, the "branded content" agency, and all the other schemes will have to be either sold off, or shuttered completely. Then there's the company's distribution capability. They may have to open themselves to even more distribution only deals with other independent producers than they already have.

3. Stick To The Core Business. Relativity was originally founded to produce, and eventually distribute, movies and television shows. 

Maybe it needs to do that and only that.

It should also avoid trying to compete with the studios for the massive blockbusters. The new Relativity should target the middle ground, smaller scale pics that the big studios don't seem to make anymore even though, back in the day, they were seen as the profitable backbone of the industry. They should also be budgeted tightly to decrease risk, and increase the potential for reward.

They should just follow this simple formula:


No more wacky schemes to produce only hits, no more "lifestyle brands" and no more BS, just stick with making stories people would enjoy seeing more than once.

Then Relativity might have a shot to live again.

1 comment:

  1. Rainforest Giant10/8/15 1:01 pm

    How often do you get to boff the starlet of "Horror Island Massacre" or whatever and if you do is it as fulfilling as J-Law? How much of Hollywood is just 'investors' (they are no more investors for the most part than victims in a ponzie scheme) wanting access to the girls in the pic?

    How much of the 'casting couch' is just Roman Polanski style bs designed to get young girls who might or might not appear in the back ground in a long shot?

    Hollywood is intrinsically evil and a perpetual money loser except for someone like Roger Corman or Mel Gibson (to pick the two ends of the scale). Actually if I've learned anything reading this blog is that hollywood routinely lies about its finances (Relativity might actually have made money but the money guys made it disappear).

    Sure Relativity could change? Will it? Does 'Joe Investor' want access to Jaimie Presley or Jennifer Lawrence? Will mid/low level talent attract the kind of money it can now.