I’m in Hollywood - Chapter 721

[Chapter 713 1/10]

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To revitalize a TV station, it is definitely not enough to rely on a popular program. However, a popular program that is full of topics and attracts wide media attention can significantly increase the popularity of related TV channels and gather more popularity for them.

As long as the situation is opened and high-quality TV programs are continuously produced, the TV station can enter a virtuous circle of continuous development and growth.

That’s what Eric expects from America’s Next Top Model.

The fact that Firefly does not have a big M&A expansion plan in the next few years does not mean that Firefly will stop growing.

Before Eric proposed the idea of “America’s Next Top Model”, Katzenberg had already begun to increase the support of Firefly’s record business. Eric was familiar with the development prospects of the Western recording industry, and he was very interested in Katzenberg’s development. The planning, although not eager, did not stop it.

Relying on strict copyright protection laws, although the western record market has been strongly impacted by the Internet era and has become increasingly sluggish, it has not declined to the point where the entire industry has disappeared.

In addition to the record business, the more standardized commercial operation of the peripheral products of its popular films is one of Firefly’s important development plans in the next few years. The upcoming cooperation negotiation with Hasbro Group is part of this plan.

After hearing the idea of “America’s Next Top Model”, the energetic Katzenberg immediately proposed the idea of developing lietime TV.

As I said just now, even if America’s Next Top Model succeeds again, a TV station cannot be supported by a single hit show.

After brainstorming in several meetings, management quickly worked out a detailed plan for original programming, network repurposing, programming, and channel marketing.

In the next three years, Firefly will invest 100 million US dollars in the program production, procurement and marketing of lietime TV station each year, and it is expected to create a professional female TV station for young women who focus on fashion and high-quality life.

The parent company of lietime TV, ae TV network, is jointly owned by Firefly Group and Hearst Group. Therefore, this reform plan for lietime.

It is also necessary to negotiate with the Hearst Group and obtain relevant resource support. The Hearst Group has hundreds of daily newspapers, weekly magazines and magazines around the world. At present, these print media resources are still indispensable for the promotion of women’s channels. of.

After the Oscars, awards season is finally over.

Eric also handles most of the film projects that require his own attention.

But before I had time to rest for a few days, a lot of things came to me again.

The Hearst Group is headquartered in New York, and the headquarters of ae TV is also in New York. Once the plan is completed, most of the programs of Lietime TV will also be produced in New York. No matter from which point of view, Eric needs to rush to New York in person. Related consultations and placements.

At the same time, the birthdays of the two little guys are coming soon, and Easter this year is also on April 16th.

These special days, always take time to accompany women and children.

Hasbro is headquartered in Rhode Island, which is very close to New York. The negotiation between the two sides on toy development cooperation will finally be carried out in New York.

The capital injection negotiation between Firefly Investment and telecom operator SPNT has started, involving more than one billion US dollars of investment, and some important occasions also require Eric to attend in person.

Both Firefly Investments and SPNT are headquartered in New York.

On the plane to New York, Eric simply calculated the schedule.

After I found out that I was busy with these things, the summer season of the movie was coming.

Just got off the plane.

Eric went into non-stop work.

At the headquarters of ab TV station in the upper west side of Manhattan, in the conference room, the senior management of Firefly TV Network, the management staff of ae TV network and representatives from Hearst Group are holding relevant meetings. At the invitation of Eric, Hearst Group is the third The acting head William Hurst was also sitting in the conference room.

“…According to the statistics of 1994, the number of subscribers of lietime TV station is 31.5 million. Cable operators such as Comcast, Time Warner, Telecom and other cable operators pay an average of 15 cents per subscriber per month, and lietime The operator of the TV station last year was divided into 56.7 million US dollars, the advertising revenue was 33.5 million US dollars, the annual revenue was 90.2 million US dollars, and the profit was 13.8 million US dollars. We plan to use three years. The number of user subscriptions has expanded to 60 million to 90 million, and the operator’s share has been increased to 25 cents, and it is expected that through the broadcast of a series of high-quality TV programs, advertising revenue will surpass the operator’s revenue, reaching an annual revenue of 500 million US dollars , the scale of net profit of 100 million US dollars.”

Katzenberg finished the simple report and was about to move on to the next topic. William Hirst, who was sitting at the top left of the long conference table, raised his head and knocked on the table in front of him. The document ignored Katzenberg, but looked at Eric, who was sitting opposite him on the other side, and said, “Eric, last year’s Victoria’s Secret show was considered a direct profit and indirect stock appreciation. You’ve brought in more than $1.5 billion, doesn’t this plan seem a little too stingy in comparison?”

Eric leaned back in the comfortable leather chair, holding a pencil in his hand, habitually He turned a pen in his hand and said with a smile, “William, last year was a complete accident. The road has to be taken step by step. With the foundation of Lietime TV, it has been very good to achieve this goal in three years. The total profit of the TV business is only more than 600 million US dollars.”

William Hirst stared at the young man opposite and said, “I don’t pay much attention to the TV business, but I always feel that this plan is not perfect, or that there are some places that are not perfect. Make

it clear.” The

other party didn’t mention it, and Eric continued to go around: “This is just a draft, and it must still need to be revised, otherwise we wouldn’t have to hold this meeting today.”

William Hirst looked at the sheet

With a lazy smile, he said, “Eric, I mean, regarding the production of original programs on Lietime TV, this plan doesn’t seem to explain what to do, right?”

Eric replied: “Oh, I don’t think there is any objection to this matter. Except for news, all programs on the TV network are in charge of the TV program production department of the Firefly Group. This time, of course, it follows the convention.

” The wrestling, everyone in the field took the initiative to quiet down and listen patiently.

As industry elites, most people actually know what the two bosses are discussing.

When the two of them said this, even the clerical staff who was in charge of the meeting minutes and were a little confused just now almost understood.

Eric and William? Hurst discussed the copyright attribution of original programming on lietime television.

Usually, when a TV program producer sells the first broadcast rights to a TV station, the sales revenue obtained only accounts for a small part of the program revenue, and it cannot even recover the cost.

Most of the income of TV programs actually comes from the distribution of video tapes of the episodes and the income of TV program syndicates after the first broadcast of the TV station. The so-called TV program syndicate, the simple explanation is the program distribution system.

A TV show goes through the syndicated show distribution system.

In the United States and even more than 100 countries around the world, the sales profits of broadcast rights and remake rights of countless TV stations will definitely far exceed the income of the first round of TV broadcasts. It is more than ten times the cost, which is why many TV drama protagonists can get millions of dollars per episode later. If there are no videotapes and syndicates, and only relying on the first round of advertisements and cable TV, it is absolutely impossible for TV networks to set such sky-high prices. remuneration.

Most TV station program production departments and distribution systems are integrated, and there is no need to distinguish between these issues.

But the parent company of Lietime TV, ae TV network, is different.

The ae TV network is jointly held by Firefly and Hearst, each holding 50% of the shares.

If Lietime’s original programming is produced by the ae network’s production arm, the Hearst Group will be able to share in the profits from the tapes and programming syndicates.

But if the shows are produced by Firefly’s TV division, the rights to the shows have nothing to do with the AE network, and the Hearst Group doesn’t have to take the risk of production investment, but it won’t be able to share the tapes and syndicate revenue.

That’s why William Hurst just said the plan was ‘stingy’.

If TV stations alone can make $100 million in annual profits from their cable revenue and advertising, videotape and syndicate revenue must be much more than that.

And as we all know, Eric’s projects, whether in movies or TV series, can be associated with the word ‘profiteering’.

Of course, Hearst Group is unlikely to give up this easy profit.

Although the Hearst Group is in a giant position in the paper media industry, it does not have enough confidence in the operation of the TV network. William Hearst realized that Eric invited him to attend this conference, which would not be like the appearance on the surface. So simple, at this time, I can only follow his ideas and say: “Eric, I think it is more suitable for the ae TV network to be responsible for the production of these original programs, and the Hearst Group can provide production funds in proportion, In addition, if we need the support of paper media resources here, we can also try our best to cooperate.”

Eric seemed to hear something of interest, so he straightened up and said, “Speaking of proportions, William, I think Firefly and Hearst are in the same boat. The shareholding ratio on espn is more coordinated, what do you think?”

Although he was already prepared, William Hirst almost threw the document in his hand at him when he heard Eric’s words, and shook his head without hesitation. : “Eric, this can’t be done, absolutely not.”

Firefly and Hearst’s shareholding ratio in the ae TV network is 55%, but in espn’s shareholding is 28%, Hearst accounts for 20%, and Firefly accounts for 80%.

In the beginning, Hearst and the original Metropolis Media Group had equal rights in espn. In the 1980s, espn had not yet risen. At that time, Tom Murphy from Hearst Group and several other companies Minority shareholders bought most of the espn shares, which cost less than 50 million US dollars at the time. Now espn is the largest sports channel in North America, with an annual profit of more than 200 million in 1995. At first, it was only the Hearst Group that sold it. That share of the company generates more than 50 million in profits every year.

With such a lesson in mind, William Hurst certainly couldn’t do such a stupid thing again.

Hearing William Hirst’s excited rejection, Eric shrugged and said, “William, if you don’t agree, then forget it.”

William Hirst was speechless for a while before continuing: ” Eric, I’ve heard your idea for America’s Next Top Model. This project needs a lot of print media resources. Firefly sold all of its print media assets last year. Without Hearst, it’s hard for you to be alone Make this project bigger.”

“William, I think this is a win-win situation, we get resources, and you can also get more news materials,” Eric shook his head, with a confident smile on his mouth: “And , you have made a mistake. There is no Hearst, Condé Nast, and News Corp. The relationship between Firefly and these two companies is just right. I even have Yahoo in my hands, although the influence is temporarily unable to match the traditional Compared with print media, but the user population has a lot of overlap with the fashionable female audience of Lietime TV, I think you can definitely see the media operation potential that Yahoo showed during the Victoria’s Secret show last year.”

William Hurst Zhang He opened his mouth, but for a while he couldn’t find the right words to refute.

Although he was reluctant to admit it, he had to admit the fact reluctantly in his heart. Although Hearst Group is very strong in the media industry, Hearst Group is not essential for Firefly, which has richer resources. On the other hand, without Firefly, it is not difficult for Hearst Group to further expand the ae TV network alone.

The current situation is that Eric has put forward the conditions that Firefly wants most of the shares of ae TV station. If Hearst Group does not agree, then they will not be able to share most of the profits that lietime TV station may bring after the growth.

But if compromised, the Hearst Group will almost certainly repeat the mistakes of espn.

After another tangle, William Hurst said: “Eric, Firefly wants to take 80% of the shares, it is definitely impossible, we will give up the absolute control at most, you can completely transform this according to your own ideas. Home TV network, how about it?”

Eric shook his head: “William, the Hearst Group’s business focus is on print media, I don’t think you need to stick to these TV network assets at all, so let me take a step back, Firefly only needs 75 %, this is my bottom line.”

“No no no, Eric, at most 55%, if it’s higher, I’d rather give up the power of ae TV network to undertake the programming and keep it as it is.”

“Hey, William, you know Well, last year’s “Emergency Room Story” cost less than $30 million to make, but the syndicate sales in the first season alone made more than $150 million, and we’ll be releasing a video in the near future, so the revenue will be more objective. Just look at the advertising revenue, $45 million, the profit is only one-tenth of that of the syndicate, and one-tenth of that of the syndicate.”

William Hirst looked helpless: “Okay, Arie Gram, 60%, no matter how high, I am afraid I will be criticized by the shareholders.”

“You can’t lie to me, William, the Hearst family has always firmly controlled the Hearst Group, and no one will oppose you. The decision, 70%, is the bottom line that Firefly can afford. If you can’t accept it, Firefly will not rule out buying a cable TV station alone.”

“…”

“…”

Everyone in the conference room listened to the two bosses, come here I go, quick-thinking, fast-paced, and seems to blurt out without hesitation, but there is shrewdness and calculation everywhere, and I am amazed. Westerners rarely see a market-like bargain.

In the end, after arguing for more than ten minutes, the two sides finally decided on a plan that they could barely accept. Firefly held 65% of the shares and Hearst Group kept 35% of the shares. Sturt Group fully cooperates with print media resources.

(To be continued.)

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[End of this Chapter]