Releasing a movie is a wager. Every time you do it, you’re betting it’s going to make its budget back and perhaps even become profitable.
But choosing not to wager at all is no way to run a business, as anyone watching the recent debacle around Coyote vs. Acme can attest.
The film, a feature-length take on the classic Road Runner cartoons that integrates live-action elements around the ingenious presence what Wile E. Coyote has finally decided to sue the Acme Corporation for repeatedly selling him defective goods, was unceremoniously dumped from release despite having direct connection to one of the most prominent players on the Warner Bros. Discovery payroll, superhero impresario James Gunn.
Why would you want to prevent more of this happening?
But the backlash was strong, and creatives in the film industry, having survived months of strikes without completely losing their shirts, complained loudly enough that WBD’s initial plan—to remove the film from release for tax-savings purposes—has now been replaced with an attempt to sell the film to other studios.
The backlash was strong enough that a member of Congress, Rep. Joaquin Castro, suggested it was enough for the Justice Department and the Federal Trade Commission to get involved—as it was clear evidence that the unholy merger that brought together Warner Bros. and Discovery Inc. was creating direct harm to the film industry.
“The @WBD tactic of scrapping fully made films for tax breaks is predatory and anti-competitive,” he wrote on Twitter.
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This is 100% correct. The David Zaslav era of Warner Bros. has been a tragedy for the creative community, and one that has most acutely affected one of the company’s largest traditional areas of strength—animation and family-friendly content, a market Zaslav doesn’t seem to understand. And given that the film industry often receives significant tax breaks for filming in particular states, it feels like a giant shell game of trying to uncover tax revenue wherever it can.
To be clear, it’s not unheard of for the film industry to have failed films. After all, by its very nature, it’s an industry that makes continuous bets that artistic works will make money.
And these bets don’t always work out. Example: In 2001, a romantic comedy with a budget of more than $100 million, Town & Country, made back just a modest $10 million. (With inflation, those numbers look even worse—$175 million budget, $17.57 million at the box office.) The film didn’t initially have a budget that huge; the production had a number of things going against it, including meddling by star Warren Beatty, an unfinished script during filming, and a need for repeated reshoots.
But at least that movie was released—despite, as Deadline reported, Warner Bros. Motion Picture Group CEO Michael De Luca running the studio where that disaster was going off the rails. Sure, some movies don’t see release, but at least most films produced by major studios do, in some form.
Warner Bros. Discovery’s recent moves to shelve completed works or remove exclusive works from streaming services has been particularly awful in this regard, because the reason they’re doing it is because they bit off more they could chew financially, leading to cash flow and debt problems, and instead of fixing their mistakes, they are causing literal harm to to creatives that had nothing to do with the high-level business failures that created the predicament.
Example: Last year, the makers of Scoob! Holiday Haunt, another film canned by WBD, spent much of the summer and early fall of 2022 putting the finishing touches on a film that, despite being cancelled, was still being completed. For more than three months, the Scooby-Doo franchise film, intended for HBO Max, was being meticulously worked on, despite everyone involved in the production knowing it was never going to be seen. A sad Instagram message from co-writer Tony Cervone personally got me in the feels.
The world’s dumbest analyst recommendation happened this week
What created this situation full of warped motivations? Money and control—and bad unsolicited advice, too.
Earlier today, I read a piece about how Warner Bros. Discovery, despite spending all this money to merge two entertainment empires together, despite all the pain that this deal created, still had a gap. The financial firm Guggenheim Securities said that because Warner Bros. Discovery did not have a deal to carry NFL games, it should consider acquiring another company with these rights—it suggested Fox or Paramount—to help fill this gap.
This analysis caused a nearly 4 percent drop in Warner Bros. Discovery’s stock price, and will likely put pressure on this company which is still paying off billions of dollars in debt on the last massive deal it did, to do another massive deal.
Who the hell wins here? It sure ain’t anyone who wants to watch something entertaining, or anyone involved in creating any of these things. This analysis does not consider the absolute shitshows that a deal like this would create—buying Fox, for example, would lead Fox News to have the same owner as CNN, creating antitrust concerns, while creating weird optics around the fact that WBD already owns a significant stake in another broadcast network that it would likely have to sell. And then there’s the debt, which will raise prices for consumers and needlessly threaten the work of the creative community even more than it’s already being threatened. It’d be putting new debt on top of old debt. All for the sake of a couple of hours of football a week, at a company that already has long-term deals with three of the four major sports leagues, plus March Madness and one of the two major pro wresting circuits.
The analyst at Guggenheim who came up with this idea doesn’t appear to have thought this one through. But it still sank WBD’s stock price anyway.
Despite all the wheeling and dealing, all the financial tricks on display, it’s never enough. In creative fields, battles like these happen all the time for the soul of a company. Good leadership stands up for the creator and stands in the way of those who aim to just make a buck on the whole deal.
Warner Bros. Discovery has proven, with its desire to completely shelve productions without even giving them a chance or reportedly even watching them, that it is focused on a single thing, and it ain’t releasing films. This is clear by the fact that it is failing to actually commit to some of the bets it already paid for.
It will keep making the same painful mistakes—falling off of cliffs, running into walls, blowing itself up—all for a windfall that keeps falling out of their hands.
Links Vs. Acme
The Fast Company profile of Marques Brownlee is great, but just as good is the interview with his mom, who convinced him to set up an LLC and still does his books.
I can now say I worked on a YouTube video. I helped script this video by Zophar of Zophar’s Domain, a legendary emulation site I worked on as a teenager. Zophar, who I met last year, talks about the video series he worked on during the RealPlayer days. It’s a trip.
“It’s not as if you’re selling sugar against a world drought.” Despite the email intended as being internal, Barry Diller speaks for everyone stuck having to deal with Google’s dramatic changes to its search engine.
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