Comments on: Viacom Chief Touts Star Trek As ‘Unqualified Blockbuster’ As Film Reaches $380M Globally

By: RD

RD — Mon, 05 Oct 2009 22:23:48 +0000

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By: Son of a Maui Portagee

Son of a Maui Portagee — Wed, 05 Aug 2009 20:29:06 +0000

About the only thing I thought to mention was that Norway Corporation seems to still be a factor but the reporting is sketchy so it is difficult to discern to what extent:

http://www.npr.org/templates/story/story.php?storyId=104196387

By: RD

RD — Sat, 01 Aug 2009 18:13:17 +0000

97. Son of a Maui Portagee – #94. You just seemed confused about why they would split in the first place.

My understanding it resulted from an internal struggle for control of the company. Les Moonves is a powerful man in Hollywood and the boardroom and strong-armed Sumner Redstone into the split, which also had potential financial benefits for both companies and their stock holders. If you care to share more clarity on it, I’ll be happy to receive it.

However, simply because Moonves has chosen to aggressively pursue his options, as has Paramount, is only evidence of a continued rivalry and efforts by both companies to autonomously control their fiefdoms. It does not preclude the existence of arrangements to protect both parties from profit losses in the first place. I have no doubt that Viacom did not give up profit participations on properties they otherwise owned outright. Why do you think Moonves would lower the hammer on Gail Berman in the first place? So he could sell an extremely profitable franchise to the highest bidder and be out from under a profit participation scheme and sweetheart deal structured as part of the separation package to remunerate Paramount for the loss of a massive franchise. Paramount executives were likely tasked with the duty of exploring the film potential of the entire television catalogue before they loose exclusive rights to the product. Trek is of course the most devistating blow of all … it’s a 30 year film franchise that has begat billions of dollars for Paramount in box-office, home video and merchandising. Now all they have are the films and extremely lucrative home video sales. It is in Paramount’s best interest (and National Amusements) to keep the franchise at Paramount so that they will continue earning off of a guaranteed franchise. Of course there are sun-down clauses on everything. At some point in the future CBS will likely assume their own home video distribution and Paramount will distribute its own TV. But individual properties will most definitely be grandfathered to conclusion. As long as Paramount produces Trek, whatever arrangement was in place at the time of corporate dissolution will remain in effect (unless Paramount merges with another studio). That is the nature of the Hollywood deal. I know producers who hate each other who have been tied at the hip by a single successful partnership which ran for years beyond their expectations. Paramount is undoubtedly hoping for this, while CBS can’t wait for them to fail.

By: Son of a Maui Portagee

Son of a Maui Portagee — Sat, 01 Aug 2009 00:59:16 +0000

#94. You just seemed confused about why they would split in the first place. I’m not saying the answer is there – just that the stated purpose might give some hint, i.e. might be pertinent. Also, it demonstrated that after the split, agreements such you speculated, did exist in other areas but carried expiration dates, after which, the parties involved seem more than willing to take each other on in competition.

All your other speculations on the possible internal arrangements between the two with regards to Trek are absolutely fascinating and wholly supportive of my contention that Paramount has never before had to steer a course to profit with Trek in quite this way.

The only other thing I can think to note is that since the split Viacom has had a parade of top executive firings starting with Moonves’ mirror twin. That Moonves hasn’t experienced that drama personally would lead one to speculate that if such agreements do exist: he got the better end of those deals.

You are also well aware that Moonves gave Gail Berman the Trek deadline which basically was a use it or lose it declaration – setting another one of those expiration dates, if you will. It seems clear, that if Paramount had been left with any kind of a hand with regards to Trek in the split that she wouldn’t have even had to bother with pleading for his permission? And we can speculate that ST:SS likely carries a development start window as well?

As you indicate, Moonves is film feature savvy. It seems unlikely he would settle for a “traditional” Hollywood profit participation scheme? This could mean Paramount’s Trek profit course may be more treacherous than I imagined.

By: Brian Kirsch

Brian Kirsch — Sat, 01 Aug 2009 00:24:36 +0000

As for revenue streams, the cable channel FX has already signed a deal to air the film beginning in Nov. ‘11 for $24M. That will be (at current thinking) 5 or 6 months after the sequel hits the theaters. Any idea if the film will be purchased by a major broadcast network (ABC, NBC, CBS, FOX) before then? Major TV exposure before the sequel would be wise….

By: Brian Kirsch

Brian Kirsch — Fri, 31 Jul 2009 22:54:12 +0000

As a side note, while perusing the BOMJ site, I noticed that as of today, Star Trek lost 79 theaters, while Terminator: Salvation expanded and added 176 theaters! So I compared their daily gross and gross per theater, and neither is even close! There is obviously more business being generated by Star Trek, so what gives?

Can one of you fellow posters with more knowledge of how “hollywood” works please explain this to me? Is it a “contractual” thing between studios and theater chains?

By: RD

RD — Fri, 31 Jul 2009 20:09:20 +0000

#92, not sure what those articles are supposed to tell me. It speaks specifically of Showtime, not CBS TV distribution. It also doesn’t break out how much Showtime pays for Paramount vs. the others. The way it works is this … Paramount’s feature film product is brokered by CBS television distribution, itself an independent subsidiary of CBS and a separate entity of CBS. CBS TVD “sells” Paramount’s product to Showtime and takes a percentage for the distribution. But Showtime is a minor player in television distribution, which is a worldwide venture across many networks, which depends on experience and relationships which went to CBS. DItto for home video & Parmount. CBS TVD will most likely continue to “sell” Paramount’s movies to Epix, depending on how the split deal was structured and what was “grandfathered in”.

There is no way to infer the internal operations and profit participations for a whole studio from a couple of articles about one business venture. It is entirely possible that the Showtime deal notwithstanding that Paramount is still tied to Showtime on specific projects for first refusal. Despite their overall deal with Showtime being over, that may apply only to new product and not franchises which are still in production by Paramount. I guess we’ll see this Winter when Trek shows up on pay-cable. Nevertheless, CBS will get their share of TV distribution. Just like Paramount gets their share distributing TOS & TNG era DVD & BD.

Eventually I expect both companies to completely divest themselves of mutual interests, especially if Paramount merges with another studio and CBS expands its feature film business. But the deal would have been entered into to protect both companies over a period of time, for whom otherwise major profit centers were being stripped from their holdings – if for no other reason than to prevent Nat’l Amusement’s corporate holdings from plummeting dramatically while they got used to walking on their own legs.

By: Doug L.

Doug L. — Fri, 31 Jul 2009 17:21:17 +0000

re 81 Brett

Couldn’t agree more on all points. Planet of the Apes included. DL

By: Son of a Maui Portagee

Son of a Maui Portagee — Fri, 31 Jul 2009 04:18:50 +0000

#91 – Perhaps you would find this pertinent?:

http://www.nytimes.com/2008/04/21/technology/21iht-movie.1.12178431.html

“We are an independent company. It’s our responsibility at Viacom to drive our strategy to benefit our shareholders.” – Philippe Dauman, CEO VIACOM

“”They were always intended to be independent companies, free to compete with each other.” – Sumner Redstone, who owns controlling interest in both Viacom and CBS

FWIW here’s the latest on EPIX:

http://www.hollywoodreporter.com/hr/content_display/news/e3i64d7e42a898297d755d8508dc39f37c9

By: RD

RD — Fri, 31 Jul 2009 02:26:48 +0000

#89 – I would almost guarantee that when CBS & Paramount split, both were able to negotiate some profit participation within the domains that were otherwise exclusively theirs. First and foremost, I would imagine Paramount has a right of first refusal over new Trek films. The first time they pass, they lose their license to the highest bidder. In that vein, they may well get a $1 license as well. Why? Because CBS gets a royalty on everything the movie generates. My guess is CBS is a profit participant in every aspect of the film. But don’t forget, Paramount home video (a Viacom company) also has exclusive right to all of CBS Television products. Meaning Paramount gets a cut of everything CBS sells on video. CBS on the other hand is an exclusive distributor of Paramount’s properties for television, so they get a cut of every film they sell for broadcast. It’s even possible CBS has the right of first refusal over film properties developed for television (like Young Indiana Jones). FInally there is merchandising. Given the cozy relationship, I would be shocked if an inducement to enter into the split was not offered to share profits when it comes to merchandising. Certainly such rights are obtained when other properties are licensed, so I would expect the same for Trek. However their cozy relationship almost guarantees as long as Paramount produces Trek films, they will receive a profit from the ancillary sales. I would also expect that CBS cannot simply market anything they want from the film without Paramount’s permission. Certainly this must be a complex agreement that offers both parties some kind of incentive to split the companies in the first place.