Independent movie producer and screenwriter Tag Mendillo told Westport Sunrise Rotary on Friday that the movie and network television businesses are undergoing significant technology, financing and demographics changes.
Many benefit the movie and television producers and their viewers, but disadvantage much of the creative community.
Movie studios have become hooked on big dollar franchise films – tentpoles – Iron Man, Star Trek, Batman, financed largely by third party money, while the spread of broadband Internet and mobile devices has changed the way movies and television are distributed and watched.
The television networks are going through their own shakeup, as they spend more to hold onto their shrinking and aging audiences and as cable networks rebrand themselves by replacing second runs and reruns with original content.
In years past we watched movies in local theaters. If we missed what could be summer long runs we had to wait four months for the DVD to hit Blockbuster. Even later it went to cable TV, and perhaps two years after release it was shown on broadcast TV.
No more. Now we go to the cineplex to catch a movie, quickly because it’s often gone after maybe a month, Mendillo said. Movies go to pay TV first, but sooner today than in the recent past, as studios eat into the theater window to recoup their larger costs faster.
He noted that what happened to the music business is beginning to happen to the movie business – downloads are replacing physical distribution as studios make films available on Netflix and Video On Demand sooner, some even at a premium price for early release.
Mendillo called “technology the number one thing to influence the business.”
He said the Internet and mobile devices are changing watching patterns and VOD services like iTunes and Netflix allow subscribers to download and watch movies and TV shows on their computers, smart phones and tablets when and where they wish.
Technology has also created problems for the networks as more viewers every season record their favorite shows, watch them when they want and fast forward through commercials.
Another issue for the TV industry is younger viewers who have Internet connections, but refuse to subscribe to cable. They watch YouTube “almost exclusively,” a problem because studios have not figured out how to monetize these content providers.
And movie content is changing. In the past, stories – he cited The Great Santini and Heaven Can Wait – were money makers. Today studios “don’t want these mid-level productions.”
Today it’s big dollar franchise films that can cost $200 million to make and another $75 million to market.
They have to open big, get legs and stay longer than the minimum four week theater window if they are to have a chance at recouping costs. And if they feature heroes and plots that are so American they don’t draw well overseas they need to make their money domestically.
Where to go, Mendillo asked rhetorically? Product placement, for one – “the characters don’t just happen to drive Ford Fusions,” and Apple computers are no random choice. Another avenue is merchandising – Spiderman pajamas and the like.
At the same time studios are changing the way they do business. They “have become reluctant to risk their own money,” yet seem to have ample funding from three sources – “Petrodollars, South American drug money and Russian money, laundered through movie production.”
And cost control has become a new watchword. Tom Cruise no longer commands the salary he once did. Studios “want to make stars irrelevant, they want a built-in audience” the franchise movie provides.
One studio objective is to break the Screen Actors Guild in order to lower costs, by, among other things, eliminating residuals – the fees a performer historically received every time a show or a commercial aired.
Likewise, writers and directors. “Unless you’re A-List” you’re pushed to the margin” as the industry is “democratized.” The days are gone when “middle class” creatives could get their “quote.”
On the TV side, Mendillo said this was the week that the networks squeezed $9 Billion in guaranteed revenues out of advertisers while their audiences are ”shrinking by the second” and while cable networks continue to dominate prime time Emmy awards.
The networks try to be all things to all people in order to amass the largest possible audience, while “cable can take chances” with its smaller individual audiences.
The leading cable networks are no longer dependent on third party content, but are increasingly developing their own shows – The Sopranos, Mad Men and Game of Thrones, for example.
Mendillo closed by talking about his current project – Syndrome – a story about “what you do with bad people.” He said he is adapting a graphic novel and targeting a 25 and under audience that is familiar with the graphic novel format.
Photo by Hal Levy