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Content libraries may be expensive relics

Cultural values today are different from those of yesterday

Posted: By Andy Marken 06.23.22
Source: "The Librarians," Electric Entertainment 

 

“I'm offering you a life of mystery and misery, of loneliness and adventure. More than that, I'm offering you an opportunity to make a difference, to save the world every week, twice before Friday.” —Flynn, The Librarians, Electric Entertainment, 2013

 

We love all the noise about what a rich, deep, and broad library streaming folks have compared to the “new kids”—Netflix and Apple. OK, Amazon cheated by buying theirs (MGM for $8.5 billion)… whoopee! We’re just not library kind of guys because if it’s old stuff, we’ve probably seen it or don’t want to see it. The idea of watching an old show or series is boring—especially if we’ve seen it before. Unless there’s a darn good reason!

To prepare for John Wick 4 a few months ago, we relived John Wick (2014), John Wick: Chapter 2 (2017), and John Wick: Chapter 3— Parabellum (2019), and we were ready to see Keanu Reeves back in action. For The Matrix Resurrections, we dug around and found The Matrix (1999), The Matrix Reloaded (2003), and The Matrix Revolutions (2003), and sorry, Keanu, it just wasn’t a good video game remake for us.

To prepare for Top Gun: Maverick, we had to venture back to 1986 to refresh ourselves on the antics/action of Tom Cruise and Val Kilmer.

Disney, Warner Bros. Discovery, Comcast, Amazon/MGM, ViacomCBS, Apple, and AMC Networks all tout the tremendous value of their libraries, which extend back to the era when Hollywood was really Hollywood. Their accountants are probably placing a huge value of the old content on their books and on the edge they have over the techie newbies—Netflix and Apple.

Source: Wells Fargo

 

Investing continues—While media companies tout their vast and “rich” libraries, they still focus on developing new content because that’s what people want. 

 

 

Despite that bravado, all of the studios and streamers are projected to spend a combined total of $230 billion this year for new stuff.

2022 investments

According to Wells Fargo, Disney is estimated to produce 140-plus titles this year—60 unscripted series, 30 comedy series, 25 drama series, 15 docuseries, 10 animated, five made-for-TV (streaming) movies, and more. While Zaslov is busy building his new Warner Bros. Discovery infrastructure and wasting some of his $22.4 billion investment on sports, most of the money is earmarked for new content. 

Netflix is intent on growth—especially outside the Americas—by committing $19 billion to its global content production. Paramount+ (ViacomCBS) is estimated to spend $3.8 billion this year on content, an increase of about 25% year-over-year.

Originally, Wells Fargo estimated that Apple would be spending $8.1 billion on new content, but after coming off the spectacular Oscar win for CODA this year, instead of doubling their output this year, you will undoubtedly see them dip a little more deeply into their reserves for 2022 and beyond.   

Comcast/NBCU/Peacock will invest a lot for them (increase of 22%), with $2.2 billion earmarked for new content but still well behind the other streamers. Fortunately, Comcast has a number of other sources of income to make up Peacock’s projected losses. 

We realize creative folks in the Americas are already looking to pad their savings accounts with all that fresh money coming in, but only about 16% of the investments will be at home.

All the rest is going to the markets—195 countries—that the streamers are targeting to conquer.  

Source: Unesco

 

Accelerated growth—Video stories have always been produced around the globe, but local production became more important when streaming services wanted to become global. 

 

Fueled by the production spending of global and regional streaming providers, content creators everywhere will see a boost in attention because streamers have to produce at least 30% of their content locally. 

While Netflix and Amazon are already well established in these countries, everyone else is busy increasing their local production budget—Africa, the Middle East (46%), Latin America (33%), and Oceania (33%).

Source: Whip Media
Source: Whip Media

 

Interest shift—DTC subscribers have found that local/regional content is more to their liking rather than simply taking what the Americas have to offer. The Americas content has dropped 10% with international viewers. 

 

The two have found that creating content locally is also good globally because production costs are lower and, more importantly, the content travels well from one country to another… including the Americas. In addition, the streaming industry investment will probably be twice that amount when you also factor in things like co-financing and acquiring rights to indie films/TV programming.

Video story production is accelerating even as the Hollywood/network establishment brags about their vaults full of ready-to-show stuff. But will people watch it? Back in the day, we LMAO’d watching Airplane and Blazing Saddles… great storylines, great scripts back then. But watch them today and you say, “OMG!”

 Consider just a bit of the Airplane script:

First Jive Dude—“Shiiit, man. That honky mofo messin' mah old lady—got to be runnin' cold upside down his head, you know?”

            Jive Lady—“Jive-ass dude don't got no brains anyhow! Shiiiiit.”

On the film’s 40th anniversary, the producer was asked if he could make Airplane today and he responded, “Of course, we could. Just without the jokes.”

Blazing Saddles had a great Mel Brooks script:

Bart—“Hey, where are the white women at?”

Lili Von Shtupp—“Tell me, schatze, is it true what they say about the way you people are... gifted?”

Governor Lepetomane—“Are you crazy? They'll never go for it. And then again, they might. Those little red devils... they love toys!”

Times change, people’s tastes/priorities change, and there’s a greater attention (and hopefully understanding) of the need for diversity, inclusion, and equity in the video projects that are produced and made available. Then, too, there are the films we’re just embarrassed to watch because, honestly, it’s hard to believe that it wasn’t that long ago when we didn’t treat people as people.

 

Films like Hidden Figures are great ways to prove how backward we were in thinking/action just a few years ago. They also make you uncomfortable, and that’s a good thing. We couldn’t figure out why Taraji Henson had to walk across the NASA facility in the rain to go to the bathroom as we watched Hidden Figures. There had to be a bathroom closer, and we were disgusted, ashamed. When Kevin Costner smashed the bathroom sign and said, “We all pee the same color,” we nearly cheered out loud (we were on a plane), but we did whisper “way to go” under our breath. 

When John Glenn (Glen Powell) said, “If she says they're good, I'm ready to go,” we thought you’re pretty smart for a guy who’s going to ride a rocket to the moon. Don’t get us wrong, we don’t mind being embarrassed about our past and learning just how backward people were in their thinking/actions just a few years ago, because it makes us realize how much further we have to go.

Source – UCLA

 

Vault’s value—Content creators and studios do a very good job of preserving their earlier work, but some will probably never be reissued because attitudes and times have change. 

 

But has anyone ever looked, really looked, at those vast libraries of really great, attractive content that people are just itching to see again or for the first time? Amazon’s MGM library has more than 4,000 films and 17,000 TV shows that go back to the mid-1920s. Warner Bros. Discovery has a film library that extends back before Gone with the Wind and lots of projects they wouldn’t want to put on HBO Max without a warning label.

And when do you think Paramount+ will schedule All in the Family for streaming?

Source – Parrot Analytics

 

Expensive updates—It’s true that every streaming service has a library of content that they really want to monetize. The problem is attitudes, interests, and opinions change; and sometimes, updating the material is just too costly. 

 

Yes, all of the streamers have libraries of expensive content they’d probably like to use to beef up their streaming content inventories; but times change, attitudes change, priorities change. Consider the globally recognized and loved Disney. While Disney wanted to simply provide viewers with wholesome video entertainment, they have come under attack—along with the rest of the industry—for representation of just about everyone. It turns out the industry can’t satisfy everyone’s entertainment desires. Every month, Chapek and his team gather for a video conference with advisors to evaluate/discuss films in the can as well as new projects, to do what Walt Disney first envisioned the company to do when the conglomerate was founded in 1923—be the family-friendly folks that made movies, TV shows, park rides for everyone.

The monthly cross-section meetings are designed to pick out stereotypes and insensitive imagery, and provide perspective. Some shows/films are added to Disney+ as is, while others are considered to be ready for the streaming roster with some editing/rework. Still others have a disclaimer added, such as “negative depictions and/or mistreatment of people or cultures.” And an unknown number of projects are moved back to the darkest portion of the content vault to fade into oblivion.

Chapek’s predecessor, Bob Iger, pushed the entertainment company to emphasize diverse casting/storytelling and to have greater inclusion and equality. Iger’s goal was to encourage people to accept multiple views of cultures, race, differences. And it worked pretty well. Black Panther had a largely black cast, was a powerful Afrocentric storyline, and was a global blockbuster. Star Wars was refocused around female characters, and animated movies like Moana, Coco, Raya and the Last Dragon, Soul, and Encanto, for instance, showcased a variety of races, cultures, and ethnicities, and were widely enjoyed by their audiences.

But… the real world seems to be suddenly ugly, with every partisan side/view insisting Chapek isn’t doing right by his people. In trying to offend no one, Chapek and Disney are suddenly affecting everyone. In March, Chapek told employees, “Our diverse stories are our corporate statements. I firmly believe that our ability to tell such stories is the best solution.” He’s probably right because what is trending on Twitter, Facebook, TikTok, Instagram, Snapchat, Pinterest, and the range of other social media sites is often replaced tomorrow by a new complaint.

Source: "The Librarians," Electric Entertainment

 

But still, there’s a lot of content sitting in studio/streamers libraries that were wrong then and they’re certainly wrong today. The key is being aware of the missteps of the past and preventing them again in the future. Streaming services have to focus on today and tomorrow. Otherwise, it’s like Jacob said in The Librarians, “It doesn't feel like you're trying to build a team. It feels like you're trying to fill a void.”

New, unique content may be a better solution for building a service’s future. We’re pretty sure content creation and production folks will agree.