Monday, July 15, 2024

Warner Brothers and the Quest for A Monopoly

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Change is coming to your local multiplex, whether it likes it or not. Hollywood and movie theaters have finally been forced to face a reckoning of their own inaction. The streaming services are nipping at their heels. Yet, even as many wring their hands and issue dire warnings, rest assured this has all happened before; history continues to be a nightmare in which the major studios, megaplexes, and ourselves, can never awake.

Many have prophesied the death of movie theaters. Like Nostradamus and horoscopes, it is an easy and lucrative business model to spin vague nonsense with a gloomy tone. Underneath it all, you will find not the fear of losing a sacred temple in which the masses congregate and bask in a collective experience of experiencing a thriving and popular artform. No, it is, as always, about America’s one true religion, greed.

Warner Brothers, which owns the streaming service HBO-Max, announced that from now on they will show movies in theaters and online concurrently. Before now, the most any studio dare to do to shake up the industry was the deal Universal made with AMC back in late July. The deal shortened the window of theatrical exclusivity but did not eradicate it. More importantly, it was only with one theater chain not all of them.

AMC is taking on water and has been close to bankruptcy since early on in the pandemic. Movie theaters were on shaky ground even before COVID-19. Now they have to contend with a virus raging through the world. 

While there may be a vaccine coming shortly, we live in a country notorious for not giving a shit about its citizens. Which is to say that at present, neither the sitting Fascist nor the President-Elect have any real plans on how to distribute the vaccine to a weary and suffering American public. It doesn’t help matters that news has recently dropped that one of the companies behind the vaccine Pfizer has admitted to offering the Not-so-Great Dictator an opportunity to increase the vaccine orders. Anyone who has read the Art of the Con knows that he, of course, turned the company down. Once, Pfizer fulfills our order for a hundred million vials they must then focus on fulfilling the rest of the world’s orders. Meaning we won’t get more of the deus-ex-vaccine until later next year. It’s important to note that the vaccine requires two dosages and thus a hundred million becomes fifty million.

I mention this because while greed is the primary mover of every action in Tinseltown, Warner Brothers is stuck between a rock and a hard place, of its own making. The bungling of the studio’s finances and refusal to read the writing on the wall until it found a metaphorical gun to its head is squarely in Warner Brothers’s ballpark. This is an act of survival for a company that, despite being a partner with DC and churning out big-budget blockbusters, has cared more about studio executives’ bonuses than the bottom line. To some extent, we cannot be angry at them for behaving as every other American business does, without regard for anything or anyone other than their own shallow pockets.

Movie theaters are not blameless either. For decades these thriving multiplexes have price gouged consumers, both with ticket prices and concessions, and then made them sit in the dark and watch a half-hour of commercials before even getting to the commercials pertinent to the movies: trailers. These shining temples of sacristy have always splurged to buy the latest tech and make their cathedral to cinema shiny and opulent, only to let it all rot away on the vine. If you’ve ever wondered why the carpet looks so bad or why the screen looks so dark, it’s because the owners of these chains don’t care any more than Warner Brothers or any other studio does.

All one has to do is glance at a theatre worker’s pay stub to understand that. I should know, I work at one. Of the two managers, I’ve worked under one who actively and publicly stated that he wanted to get rid of projectionists. Why? Because they cost money. The other one understood the importance of not just projectionists but of having a healthy and happy theater staff.

To Warner Brother’s accidental credit, they have inadvertently taken our welfare into account. Most theaters are not open yet, but I cannot imagine going to work in the present climate and dealing with the type of guests who would go to the movies during the worst part of a viral pandemic. Understand that if we were to open, at no fault to my managers, I am confident that the company would do the bare minimum of installing safety measures, much less any power to execute or enforce them.

Warner Brothers appears to be looking out for the little guy. Coincidentally, the little guy is also who Warner Brothers are screwing over. Pragmatic and inevitable as their actions may prove to be, they did so without consulting anyone below their paygrade. In other words, they screwed over the workers.

Being workers in America, they are no doubt used to it. 

When you go to the theater you may have noticed the fifteen-minute stretch where you see some fifty logos for other studios, some foreign, some artsy and pretentious, and others that look familiar because you haven’t seen them since you plopped your VHS copy of The Journey of Natty Gann into the VCR. Movies and distribution are so cost ineffective that even a major studio like Warner Brothers is forced to team up with other studios both internationally and domestically just to get the movie out the door and into theaters. 

Studios such as Legendary, Village Roadshow, and others take on some of the finacial burden of the film. By inking this deal, Warner Brothers has essentially sheared off a large portion of the profits–but not for themselves, oh no. For those poor suckers who agreed to help finance the distribution. To say nothing of the theaters who now find themselves in a crowded market with both theaters and the studios own streaming service to contend with.

These are the people Warner Brothers sidestepped. Saying nothing of actors and directors who made deals with the studios, such as taking a pay cut in exchange for a percentage of the box office receipts. Anyone familiar with Spotify knows what a pittance streaming residuals are as compared to the nine figured box office numbers.

Still, Gal Gadot will be receiving an added ten million dollars from the Warner Brothers deal. Hardly a sad day for her. But what about the actors without a marquee name? 

While I am striving for a level head, it’s important to understand that I wasn’t being facetious. This really has all happened before. It’s happened a few times if we’re being honest.

In the 1950s television sets began spreading throughout the world. Then, like today, movie theaters clutched their pearls and wondered what was to become of them. Major studios became jittery as well. After all, in 1948 the Supreme Court handed down the Paramount Decrees mandating that the studios were no longer able to own every aspect of the movies they made and distributed. Theaters were now free from studio meddling and television presented a brand new and mysterious adversary.

The studios made a deal with the television stations in the mid-50s that they could show movies but they insisted on a window between release and syndication. To ensure this, the studios mandated that television could only show movies before 1948. A generation of classic film buffs was born. 

But then a scant twenty or so years later, VHS entered the world. Again studios and theaters told us there was trouble right here in river city. The idea of someone owning a movie they could watch whenever they wanted without paying for it each time was a nightmare for a country that has never known anything it couldn’t slap an obscene price tag onto. Only this time…something new happened. Studios are always concerned about loose pennies falling through the cracks, but some began to see a way around the Paramount Decrees. Studios could produce these tapes and thereby get the more of the profit without having to worry about the middle or little guy.

The problem is that in the days before, and since, home entertainment, studios still partnered with other smaller studios for distribution. Part of the reason many movies are not available for streaming is that the distribution rights still belong to the distribution studios for both theatrical release and home video release. Some studios exist primarily for international distribution or home video. Major studios would rather not bother with asking them for the rights because that means the studio will have to pay for the rights, so it’s better if they don’t release the movie at all.

However, the Warner Brother/HBO-Max decision is something different. For one, they are not dropping movies so much as making them easier and safer to access. But it is also a stab at the heart of the Paramount Decrees. It is another step in the production and supply change in which the major studio has total ownership, a monopoly. They now have control over the making and distribution of their films. 

We live in an age in which we are drowning in streaming services. Some movies are available on multiple streaming services, but more and more, if you want to watch a particular movie you need to go to a particular streaming service. Some of them are beginning to require not only a subscription but a premium fee to watch it in the first thirty days such as what Disney+ did with Mulan

Lest we forget, Warner Brothers is, in fact, not Warner Brothers but AT&T and Warner Brothers. The reason why the move to do away with theatrical exclusive windows is raising so many hackles is that this is not a studio, this is a corporation studio. Not the old type either but a brand new blend of corporations that have nothing to do with movies and a movie studio. Corporations have even fewer scruples than movie studios do, which is saying something.

One has to only look at Disney and how it has gobbled up so much of the market. With streaming services and franchise production, Disney owns so much real estate they are growing dangerously close to being able to apply for statehood. Having two companies wielding so much power is good for the market, bad for business, and simply awful for artists and movie-goers.

Again, none of this is new. Streaming revenue, copyright residuals, and such have long been known issues that required immediate and comprehensive action. But neither the studio nor the theaters ever did anything. The story of why they didn’t do anything until it was too late is the same as it always is. They didn’t do anything because it would cost money.

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