Elizabeth Guider Reports: View from NATPE


The overarching preoccupation of executives at this week’s NATPE confab in Miami was scale—what it is that companies have to do to stay relevant and revenue-rich in an age of unprecedented disruption, unpredictable regulatory reverses and rivalries that were unimaginable just a few short years ago.

Whether from executives representing the Hollywood majors (a notable number of whom were on hand for one event or another) or listening to others lassoed into opining on one or another panel, the refrain was the same.

“Scale is important,” said Tony Vinciquerra, chairman and CEO of Sony Pictures Entertainment, addressing a question about the challenges facing Hollywood’s major studio players in this age of accelerated change.

“We’re a minnow when compared to the FAANG companies,” Vinciquerra suggested in describing the challenges facing the industry in the OTT era. The FAANG companies he was referring to are Facebook, Amazon, Apple, Netflix and Google, all of which have market caps that dwarf those of the six Tinseltown studios and all of which to one degree or another are horning in on the content production and/or distribution business. Not to mention that Apple has just announced it’s repatriating $250 billion from abroad to take advantage of the Trump tax allowances for such moves. Some of that dough, after taxes, may very well get earmarked for the company’s nascent video creation business.

“We have to grow,” Vinciquerra added in remarks during a Q&A session Wednesday with TV anchor/personality Soledad O’Brien.

The keynote by Vinciquerra was one of several dozen informational sessions with executives both domestic and international that have become a focal point of the three-day event, paralleling the program market. The latter unspooled in an adjacent hotel and was heavily geared toward Latin American companies, which arrive as both buyers and sellers of product.

Although the vibe at the market was generally upbeat thanks to mostly improving economies, the Sony executive’s concern was echoed by a number of other executives publicly and privately during the event, prompted in part by the recently announced bombshell plan by Rupert Murdoch to sell the film and TV assets of 21st Century Fox to erstwhile studio rival Disney.

Longtime Wall Street investment analyst Michael Nathanson, a partner in MoffetNathanson, suggested on another panel that “paranoia among media executives is higher than ever.” He was referring to their worries over the inroads that Silicon Valley behemoths are making in the content business, both by vacuuming up worldwide rights to Hollywood product and by coming up with their own original and, in some cases, quite competitive fare.

The investment analyst compared the FAANG competitors to “invaders from the North,” who, like marauding Vikings of yore, are alternately being viewed with alarm, approached gingerly or treated as “frenemies” by the established denizens of Tinseltown.

“The thing is, people are not staying in their lanes anymore. All businesses are now in a blender,” Nathanson added, indicating along with other analysts on an investors panel Tuesday that in addition to the Silicon Valley players, Chinese comgloms like Tencent and Alibaba may eventually step up to pick off a key Hollywood asset or two.

“Eventually,” as NATPE-goers are increasingly aware, comes fast and furious nowadays.

Though he wouldn’t be drawn on specific targets of interest, Vinciquerra (who for many years worked at News Corp as part of the top Fox hierarchy) conceded that the Murdoch-owned assets that Disney is now in the midst of acquiring—and if it succeeds will catapult the Mouse House into a different league—would have been an “interesting” play for Sony.

Asked specifically by O’Brien if, in the wake of that move, Sony and CBS were now in discussions about a potential hookup, he declined to be drawn. He did later say to World Screen that whether the other big combo in the making—the ongoing attempt by AT&T to take over Time Warner—will pass muster with Washington regulators or not, it would have “major repercussions,” implying that other media players would be compelled to consider their options in the wake.

“I would think in a few years the six major Hollywood studios will be down to three or four,” he opined on stage.

Interestingly too, smaller independent players in the content-distribution business are also mulling the advantages of growth, though at least two high-profile companies among them are adamant about remaining fiercely independent to safeguard their creative options.

Byron Allen, a prolific syndicator of first-run shows in the U.S. for some 30 years, considers himself a “disruptor,” yet in his view size does matter: more than ever. He told a NATPE audience Wednesday: “I want to be bigger. But I enjoy playing the game and it’s my belief that everyone should have a seat at the table. I’m still building my own media empire.” (His company, Entertainment Studios, has several dozen shows in domestic syndication as well as the current movie Hostiles.)

Somewhat similarly, Keshet International CEO Alon Shtruzman described the steady growth curve of his Israel-based company, which now has outposts in Europe and the U.S. He told an audience Wednesday that the goal was to remain flexible and open enough to prioritize “creative, out-of-the-box” thinking.