Inglourious Actors: Starpower Brownout
Meet Dave‘s head may be big, but his paydays are getting smaller… The NYT recently took on an ongoing trend story that New Medici has brought up in relation to the talent agencies: the downward spiral of A-list (with grade inflation forcing some B-listing) talent compensation. It’s definitely a “starpower brownout” in terms of how talent is being relegated to the coach seats of the Hollywood pay-or-play bus. Star vehicles, aka films, from the likes of A-listers Jim Carrey, Tom Cruise, Adam Sandler, John Travolta and even Denzel Washington have fallen in audience regard. Studios while not necessarily going “indie” in terms of concept, are definitely benching high-end talent in favor of niche and sometimes, ensemble casting. Witness the JJ Abrams, Judd Apatow (minus his latest), Quentin Tarantino, Michael Bay’s successes of late. Yes, Inglourious Basterds (Acterds?) leveraged Pitt’s name, but people went for Tarantino’s take on WWII. Bay’s career has been resuscitated via Hasbro and one assumes some behind-the-scenes’ producing from Spielberg. Abrams’ Cloverdale and Apatow’s use of young, gross-out talent is assuredly making studios and talent agencies rethink their strategies. Read more >>
The Empire of Ari Emanuel
Leave it up to the NYT’s to create somewhat of a sensationalistic forum on the agency aftermath of the William Morris + Endeavor merger takeover. Under the headline “Mogul Ascends With Old Hollywood Clout,” the Times serves up little more than innuendo around golf games with outside investors, anonymous Hollywood insiders fearing both Ari and Rahm Emanuels, and finally, musical chairs or board seats with Ari on the Live Nation board. From Silicon Alley Insider - our preferred business read although they ditched their Entertainment blog “The Biz” somewhat quietly – made mention of the Ari Gold Ascendency of Emanuel, but both articles seem to only paint Ari as a hard ball player on the rise with a brother in the Obama Chief of Staff hot seat. One wonders how that fraternal conflict of interest can be of any use to either brother outside of easy sleepovers at the White House. Read more >>
William Morris + Endeavor, Future of the Mega-Agency
The mega-agency merger is made: William Morris Endeavor (WME) Entertainment is the combined talent agency merging film, television, music and book publishing between WMA and Endeavor. Architected on one side by Ari Emanuel, who left ICM (under Wiatt) nearly 15 years ago, and his senior partners – Patrick Whitesell (former CAA), Adam Venit and Rick Rosen (the fourth, or fifth, principal was Tom Strickler, who resigned presumably because he was anti-merger); and, by Jim Wiatt and Dave Wirtschafter from the WMA, now Chairman and Co-CEO, respectively, with Emanuel and Whitesell. A breakdown of the deal math, what it means, and where they go next in relation to CAA.
The Agency/Deal Math:
With Endeavor’s 80-100 agents (about 280 total employees, per LAT) and WMA’s 150 agents (800 employees), Nikki Finke at Deadline Hollywood Daily’s (DHD) blog, which expertly followed the merger, predicts 100 or so layoffs over the next few weeks.
Add to that the requisite agencies’ assimilation issues – agents/agency poaching and conflicts, agents-turned-managers, change of client marketshare – comes the understanding that while this merger helps both companies survive the current economic storm and a changing entertainment environment (lower DVD revs and TV budgets, less upfront/more backend for theatrical).
With combined revenues of $300-325M – research points to a 2:1 split between WMA:Endeavor – the goal will be to challenge the dominant CAA, while maintaining course with current clients.
And with the new classification as WME “Entertainment” (as opposed to “Agency” or better “Media”), one wonders if they will stretch the model as has been seen with the Endeavor-MRC relationship.
The toss-up will be how the two sides intermingle and work together to produce coherent results for their shared clients. Early on, Emanuel said, “We need a bigger boat,” given the merger exploration process which took an emotional toll on both sides, not to mention their clients.
Endeavor Advantages:
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WMA Advantages:
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Both sides now realize that any newly merged company has to consist of only 150 core movie/tv agents at most. The mantra of these negotiations is “make it smaller”. That means, of WMA’s 150 agents, and Endeavor’s 100 agents, about 100 from the combined total will have to be let go. And since CAA’s Richard Lovett has pursued a policy of 100% marketshare when it comes to clients, the new WMA-Endeavor is making as its goal to rep only the elite Top 2%.
After the jump, more on the new agency makeup, the financial value of the enterprise, and the new-and-improved mega-talent agency skirmishes and wars to follow…
Anti-Studio: Media Rights Capital(izes)
MRC, Media Rights Capital, is quickly becoming the new model for production companies and talent agencies – a hybrid of financing, rights ownership and innovative packaging. Its rights’ model shares ownership equity with film talent, moving beyond the usual pay-or-play contracts. After the jump, we’ll dive into their recent formation, industry perspective and what their success means to the market. Upcoming MRC titles include:
- Brüno- $42.5 million from Universal, rights revert to MRC; received new R-rating instead of NC-17 yesterday
- The B Team – Will Ferrell+Mark Wahlberg action/comedy, rights to Sony
- The Adjustment Bureau – Matt Damon action/romance/sci-fi, $62M budget, rights to Universal for 20 years, then revert to MRC; 20% first-dollar-gross backend. The studio puts up P&A and gets worldwide distribution rights. Read more >>