Netflix vs.Paramount: Who Really holds the Future of Movies? | Kinolime Podcast Ep 30

Yeah, it's better than what I was abandoned last week. I never did. But his hair is tied back today. Yeah, it's not too long.

Last week you had the chin strap. Oh, yeah, I had a chin strap. Yeah, I also had bandages and you had bandages. I had a rash on my neck. That's terrible. Anyway, we got a lot to unpack today. I don't know if you've been heading the sands or just I don't know tuning out to the world. There's a hostile takeover happening in Hollywood with Ellison and Paramount and Warner Brothers and Netflix all doing it out. I'm hoping for like a third person to come in and just really make this crazy like, who can we like get in there? Could like

like the Saudis are like, who they already are. The Saudis are like the key investor for Paramount. It's the Saudis private equity and Larry Ellison is the worst blunt rotation you could ever have. But we have going on as Warner Brothers is for sale. And just everybody wants to buy, you know, an established brand of, you know, excellence in cinema and filmmaking. But I'm the type that just ignores this noise. But I have Danny here who is our expert in all things.

Politics and oh god am I. That is cool. I go to for for some noise. But we're going to unpack everything that's going on. So hold tight. Get your pencils sharpened. We're going to take some notes. But anyway,

D, give us the quick update on what is going on. Last last thing I heard last night was Ellison was like, we're going to make 30 theatrical films a year to sweeten the deal. It's over. I don't know hundreds something billion now. But give us the update.

Yeah, we're at the phase of like the, you know, massive media consolidation. Like again, everyone now is just trying to pepper the FTC netflix is is we're still going to run it like it's a theatrical business in Paramount is saying they're going to release a lot of movies.

The scary thing about Paramount specifically is like they're already talking about six billion dollars in synergy, which essentially just means layoffs. It's going to be grim and terrible. These media mergers are never good. That's a crazy word though, because it sounds so positive synergy. Like we're working together. But meanwhile, synergy, we're like, we'll work together on the unemployment line.

Yeah, it's like, you know, performance improvement plan or like, you know, calling your workplace like a table where they just sit around, like kind of figuring out what are some good words we can do to make it sound less painful. Like a call onoscopy sounds bad. But like, what if they change it to something different?

Yeah, I mean, they do that they will they outsource that it's, you know, there's like one or two places they go. It's usually McKinsey. And yeah, they they have these consulting firms like, you know, like tell them what color tied aware when they like fire.

Yeah, we're like, stop giving like dental as part of that benefits. Sorry, I mean, throw you off. So, oh, no, it's okay. So the synergy is happening. Yeah. This doesn't look very good.

Now, a lot of people are in an uproar. I know the WGA, they're joint release regarding this. People are just trying to stop this as much as possible. Yeah. Why tell us why this is no bueno.

Yeah, I mean, it's, you know, every major media merger just means less output, less investment in film, less creative ingenuity, less jobs.

The kind of perilous stakes right now of this is like, it's kind of too pronged, which is, hey, like, if Netflix wins this bidding war, well, they have one, the, at least the first phase now, Paramount's going through a, you know, a hostile takeover because they need Warner for their entire business plan to work. But, yeah, if Netflix wins, they're already talking about shortening windows and making things more powerful.

Yeah, there's a lot of things more palatable for consumers, which means direct to consumer, which means direct to streaming. Yeah, they're already talking about three week windows, which really scary about that is.

Three weeks, that's, I'm sorry, that's, that's crazy because you have films historically that have become not just cult favorites, but like box office success that are like a slow moving bolder that just keeps going and going, gather as much as it goes.

To short into three weeks, like, you're just banking on a quick punch, you know, a blitzkrieg, so to speak. And if the audience doesn't have a chance even like hop on that train, like, you're going straight to streaming.

Yeah, I mean, like what what Netflix, I mean, I think they're the argument that they will say to the FTC and say directly to moviegoers is that look, like films make most of their box office in the first couple of weeks anyway.

And, you know, after that, it's going to be more profitable and it's a better incentive to like get engagement for the film to have a go to the biggest streamer in the world outside of YouTube.

If, if like, they are counting YouTube as a part of aggregation so that it looks like it's not as big of a, you know, anti competitive acquisition.

But what they're actually doing is they understand that the theatrical business.

And again, we had a year with, you know, great movies and, you know, the, what they understand is that if they acquire Warner and like Warner right now is like 25% of like theatrical output.

After 2029, like they don't have any theatrical commitments.

Yeah, yeah.

If they could lower windows, if they could, you know, have way less Warner films go theatrical, they could make the theatrical business essentially hit a tipping point where we have massive, massive, massive amounts of, you know, big theaters close to the point where the theatrical business is no longer an actual business model.

That's salvageable for production companies and studios.

And then what happens if everything is going straight to streaming and you own Netflix, you own HBO and you own all the IP that stems from that.

Forget winning the streaming wars.

You essentially would have a monopoly on distribution, at least under the current framework we have right now for movies.

It's kind of scary, like I'm not, I tend to be more half less full guy on things, but this is kind of nerve wracking if you're a filmmaker.

You got to be like shaking in your boots, so to speak, as my grandfather would say, because the theatrical business really is, it feels like it's, it's in peril now or it's at a fork on the road, right?

We can't stop this. One of Warner Brothers will sell to someone and it will drastically change the landscape of how movies are made and released.

So we can't stop that. We just have to deal with it. So I guess sort of some things, if you're interested more than any gritty, I did a little research with our insider on Wall Street, since Wall Street's literally right here.

A couple of things to know about what's going on as well as seems like Netflix is just trying to drive up the price for Paramount in a way.

It's kind of like we are a big baseball fans. We're in the midst of the MLB free agent. We're at the winter meetings right now.

You drive other teams price above a player, so they overpay and they can hamper their marketing or their budget, so to speak.

It seems like that's potentially what I'm hearing is that Netflix is trying to drive up the price of Paramount.

Also, the value of what they're paying for Warner Brothers is way above what Warner Brothers is currently worth. And why is that?

A couple of things I heard, which I thought was really interesting, is that the studio space of Warner Brothers is a premium value due to location, the lots.

There aren't many available spaces like that around, so to, you know, develop Warner Brothers, you're getting that space of just a premium, which is a lack of supply.

So that's also an interesting reason as to maybe why Warner Brothers is being bid on so heavily.

And the third, which another interesting point is HBO don't quote me on this, but from a source, it has the largest library of unused IP.

So it's a little different than use IP, right? So HBO is paying holding fees to keep IP frozen, so to speak, or at bay, Netflix or whoever will have access to that library and then can unfreeze it.

And now you use it and create remake upon remake and we're in the cycle. So creatively to, it's like really it's, it is scary.

Yeah, but with being with every issue, right, that presents itself, I think there's opportunity. So we know them, we know the doom and gloom scenario, we know what's happening.

Let's figure out like, how could this be better? Let's not even beneficial. What now? What happens now? Let's say, let's talk to scenarios, let's say Netflix wins the bid. What happens? Quick.

If Netflix wins the bid, what would inevitably happen? One, I think like the positives, at least in the short term of Netflix winning the bid is that one, a lot less industry layoffs.

Reason being is like Netflix does not have the type of operation that is needed to support massive theatrical releases. Paramount does, that's why like there's so much like layoffs and like turnover and the event Paramount wins.

Netflix actually would need to build on the kind of operations, at least it for like I think we know their long play game, but like in order to operate Warner, they would actually need to build. So that's positive.

Another positive to is Netflix does actually have significantly, like significantly more creative freedom that I think they would permit.

Like what Paramount's already said is like the direction that they're interested in going. And again, David Ellison, like every single vanity fair Hollywood reporter deadline interview we've seen as he's this new media trailblazer and he's going to change everything.

And then he said his entire, you know, game plan for like his film slate is existing IP and Deadpool. Yeah. And he's not interested in not toward driven films. He's not interested in mid budget films. And the only new IP he's interested in acquiring is called duty. It's going to be a bro, Chacho Fest over there. So Netflix. So Netflix can do creatively.

So we have that. So now positive sides. If I know your huge fan of Ellison, let's say Paramount once the bid. What are some positives that are going to come over that?

They're saying that, you know, they would 30 theatrical release 30 the theatrical again. Is that true? Almost certainly not. That's a big deal. It is. That's a big deal. Yeah, but like the type of film. Yeah, that's the issue.

So the positives of Paramount winning is that again, is it better probably in the short term for the theatrical business? Yes.

That is to me, maybe the only positive I could see. Oh, look at that. So is there a dark horse bid coming in or the, or we just safely say it's these two.

It's funny, right? I mean, it's probably, it's probably just these two. I don't really see away. Like again, if the Ellison's want this, like I think, I think again, it's not just David Ellison. Like Larry Ellison is footing this bill, along with Saudi Arabia and a massive red bird, right?

One of the biggest private equity firms in the world. It's really a bad, you know, not the type of group you want to create the biggest creative IP vault in, you know, American history. But again, like they don't, like they can spend as much money as they want. And like the game plan for them has always been they have all the kind of GPU space through Oracle needed to acquire Paramount and like sustain a Paramount, a Warner.

Sure. And then their next play is going to be TikTok. And then the scary thing is them potentially trying to mold those into one massive media concommerant with a very specific ideological tilt. That is part of it is like the, you know, the idea that I like it'll be easier currently for the FTC to regulate that or to pass that through.

I'll tell you something positive out of this whether either wins. Yeah, I will either will one will win. I think it's inevitable, like I said, and but something that I think will be a positive or an interesting opportunity.

It means better than saying positive. It'll force because now think of it this way. Let's let's role play. They win. They they merge. Now it's harder to get theatrical films released in shooters.

Or they have their own incubator of films and stories that they want to tell and it's hard to penetrate that.

So you're a filmmaker. What do you do now? I think this just begs for self-distribution. Like I, you know, I've been saying this for years. I really do feel like this is a potential wave.

I think the distribution at the domestic distribution of the US is going to change rapidly. I think it's a goal mine. I think if someone can crack that code, can figure it out.

It's because they're there are still we meet them all the time when we go out like we have a filmmaker. I'm not going to even mention her by name, but we have a German filmmaker here watching us right now. I will not mention your name.

But regardless, people want to make movies and are going to make movies whether they work for Paramount or Netflix or whoever. So yeah, what do you do with your films like self-distribution?

I think good movies always rise to the top. Right. If the word amounts spreads, if you hear about a buzzy film because it's so hard to make a good movie. Like I mean, we played this game all the time. Like name the 10 best movies of 2022 compared to 1995.

Like it's just there's no brainer there. So the quality of the films, I think, eat in relation to the amount of films made is lower.

So the good film buzz is like, if you have a one battle after another, right? You'll give us a smile. You have one battle after another dude that's made independently and has no place to go. Boom.

Self-distribution, you create a buzz, you create a thing.

Yeah, I mean, like I guess in a perfect world, I look at it if Apple doesn't come in or you know, like Mark Walter comes in with like you can hide and just like buzz.

Is Apple even not like they're not coming. But like boy, I don't know why not because their whole thing is like, I mean, I think outside of like beats and they're like what Shazam maybe like they don't acquire companies like their whole thing is like we built them.

Yeah. Okay. But please buy this one. Okay. The

that is like the only good hopeful scenario, but I guess for me in a perfect world, it would be something like regardless of who acquires Warner.

Again, like is it something like a to be kind of set up where like, you know, independent filmmakers can make money via just like pay to ads.

That's what it is to man like free entrance. I see a world where filmmakers can actually maybe make a living off their movies now, right where they go the self-distribution or some other platform that's not going to gouge them like again, I just feel like you have we see it throughout history of the corporate greed.

And then you just have this independent revolutionary spirit like look at the 90s independent filmmaking, you know, genre like what why rose why 70 cinema rose that way because there was like a pushback.

And I think I feel it growing. I really, really do. We just feel like you can't stop people from making art and making movies like they're going to make it and they're going to have said film here and they got to send it to people to watch.

And it's going to just create a whole new I think dynamic to the market.

So my my hope with whatever kind of media consolidation merger happens is I mean, for a lot of reasons in the last year, I've become an accelerationist in a lot of the ways I think about these things.

And look, what's happening now kind of does remind me a lot of like again, you learn about in film school and you study media.

It's kind of like the the 40s again, right? It's like the Paramount decree. Yeah, we're a handful of companies not only owned the studios and had these like really restricted deals of filmmakers, but also owned the film printing companies and they owned the theaters and they were able to decide what was made, what was watched.

And it became such a massive albatross on the entire apparatus of filmmaking. And that wasn't the appetite. Film lovers wanted. It's not filmmakers wanted that they inevitably, obviously, it can't happen under this administration, but like maybe sometime in the near future.

Again, we will get to a point where we will need such massive antitrust breakups of these companies.

That would be an again, like if filmmakers can find a self-distribution avenue that in some way can sustain, you know, the appetite people have for filmmakers and to watch movies.

And then, you know, the bubble bursts and there's maybe a market for these again because there is an appetite. There is an appetite.

We've seen it this year at the cinema. We've seen it. People do show up. They're going, they still want to see movies. They want to see great movies, right? Like they there is an appetite. I think that'll never go away.

And even like hearing like the stranger things, right? Like a lot of people are met on it, right? I think the viewership on it wasn't as great as Netflix wanted.

And I do think again, it's not because it had everything going for it. I just think again, first four episodes kind of sucked.

It's going to be honest. Like, you know, it kind of did. It kind of boring. So if you don't make good content or good movies or good tell good stories, people are not going to show up.

I don't care where streaming or theaters. So I think at the end of the day, we can mess this as much as we want.

You know, conglomerates, monopolies, like you still got to make a good movie, still got to write a good screenplay. And that's why we're here at Keenaline because we do have in the new year our script screen competition 3.0 coming up.

So get your screenplay ready because we are going to change the business. 2026 is going to be big year. Not only for Keenaline, we got our first two winners going into production this year upcoming year, which is going to be fantastic.

Plus our other films that we're we're co producing, etc. We have all the great movies that you're going to be making out there on there.

Like this is a big year for cinema. Like I feel feel like 2025 was like personally from a business side was just really sludge to get through.

But now I feel like 2026 is where things are going to change. So you have the power to change cinema by making your screenplay getting into Keenaline.

And you know, we're going to make your this is our third competition. We're going to make your movie if it gets voted on.

We're going to make your movie and we're going to sell it to you know, the single distributor left by the time it's we're going to go out of Ellison's house and just wave your copy of your film.

It's going to be great. Danny is always this was such a great chat. You always enlightening to bring some shit some light on this really kind of it's kind of a boring topic for me.

I don't really like the numbers of it all but you don't like media consolidation.

I wish there was a dark horse like I that's what I was saying like I'm thinking dramatic in create like sort of someone in the mix there.

You know who is the the dark horse that would be really really really funny.

I would absolutely love.

I think I touched on it a second ago, but why doesn't the only private equity firm that like I can even have a twinge as a daughter fan of a smile.

Just have Google high.

Have Google high.

If you're going to have again and then I get to watch Dodgers and Lakers for you.

We're going to end on that but everyone thank you for to get a key to line.

If you have a great dark horse suggestion that we're missing like send it into us.

We'd love to hear your take on what's going on here in the land of Hollywood.

But thank you again.

Appreciate it. Thanks, Johnny.

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