Behind the HeadlinesThe Report
THE HOLLYWOOD REPORTER 12 AUGUST 14, 2019
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with 18 percent for Comcast and
14 percent each for Disney and
Fox, per data from Nielsen and
SNL Kagan. The ViacomCBS
library will contain 140,000 TV
episodes and 3,600 film titles,
an impressive load to draw on
as its CBS All Access, Showtime
OTT and Pluto TV do battle
with Netflix and its
ilk, including the
upcoming Disney+.
Still, the merger
may be “too little
and too late,” says
Hal Vogel, CEO of Vogel Capital
Management and a former
entertainment industry analyst.
“It will take at least 18 months to
get the combo managed smoothly,
and meanwhile it will still be a
relatively small company.”
On the plus side, Mitchelson
notes that CBS-Viacom will be
roughly as profitable as NBCU
and that it will be spending an
estimated $15 billion on con-
tent this year, nearly as much
as WarnerMedia.
In the meantime, ViacomCBS
employees need to worry for
their jobs as the company seeks
to save $500 million annually
in synergies. Viacom CFO Wade
Davis will leave the company, but
acting CBS CEO Joseph Ianniellowill stick around as chairman
and CEO of the CBS-branded
assets (so he loses Showtime and
Pop TV) while Jim Gianopulos,
chairman and CEO of Viacom’s
Paramount Pictures, told staff-
ers Aug. 12 that he signed a new
multiyear contract that will
keep him atop the studio and
that president of production
Elizabeth Raposo also re-upped.
Some suspect that Gianopulos
craves a merger of his own —
perhaps marrying Paramountwith Sony Pictures.
“The new company will not
have the financial and manage-
ment capability to make a big
acquisition any time soon,” says
Vogel. But, conversely, argues
CFRA Research analyst Tu n a
Amobi, “I would expect the com-
bined company to have ample
scale to be a potentially formi-
dable competitor while also likely
to be an active player in future
opportunities for further indus-
try consolidation.”A politically charged satire denounced by Trump and the right sparked menacing emails
as its violent marketing ran squarely into horrific news of a trio of mass shootings BY TATIANA SIEGELUniversal’s Scrapped The Hunt: Death Threats, Negative Test Screenings
How ViacomCBS Competes in TV Ad Sales
Big media conglomerates are managing to grow ad revenue despite
the loss of pay TV subscribers and viewers’ move to streamerswill need to combine with
additional content compa-
nies,” says Alan Gould of Loop
Capital. Beyond market-cap
constraints, ViacomCBS also has
lower financials than its peers.
Adding revenue that CBS and
Viacom each logged in their latest
fiscal years amounts to $27.4 bil-
lion, with operating income of
$5.3 billion. (In the deal, 61 per-
cent of the company goes to
CBS investors, while 39 percent
goes to Viacom’s.) In compari-
son, Disney had $59.4 billion in
annual revenue and $15.7 billion
in operating income.
The good news for ViacomCBS
is that the deal shouldn’t con-
cern regulators, whose job is to
fret over presumed threats of
monopolistic practices. Even in
their primary business of televi-
sion advertising, a combined
ViacomCBS would have collected
about $2.7 billion in the most
recent quarter, less than Disney’s
$3.4 billion. ViacomCBS will
boast, however, a larger share
of the U.S. television audience,
at about 22 percent comparedO
n the evening of Aug. 6, Universal Pictures held
a test screening of its thriller-satire The Hunt
at a crowded theater in the San Fernando Valley.
It was the second such screening, and some test
audience members were again expressing discom-
fort with the politics of the Jason Blum-produced
film, a source familiar with the feedback tells THR.
Hunt, directed by Craig Zobel, chronicles a
dozen “deplorables” trying to outlast a group
of private jet-flying “elites” bent on killing their
anti-choice, gun-loving targets. Following a THR
story earlier that day on the altering of
the film’s marketing plan in the wake
of a trio of mass shootings, Universal
executives and the filmmakers began
receiving death threats via email and on
social media and immediately paused
the campaign altogether. Sources say
the studio’s internal security force
became involved, but outside law
enforcement was not alerted. It appearsJeff Shell and Donna Langley bought it in May
- The studio had kept details of the script by
Nick Cuse and Damon Lindelof secret and didn’t
feature any of the overt political themes in its
marketing materials, even as it advertised the film
during Democratic debates and on
Tu c ke r C a r l s o n’s Fox show.
But had The Hunt hit theaters as
planned Sept. 27, the studio and its
owner Comcast would have faced an
uproar that dwarfed the online vitriol
it endured over 2018’s First Man, which failed to
include Buzz Aldrin planting the American flag
on the moon. Sources say the studio leadership
was reluctant to cave to the outrage of those
who have not seen the finished film. But the mass
shootings changed the calculus, rendering what
studio sources believe was a biting satire into a
project so toxic, it wasn’t worth the headaches.
Blum is said to have been on board with the deci-
sion to scrap it for now and move forward.
ShellGianopulosthat Universal did not foresee the maelstrom to
come, including round-the-clock Fox News seg-
ments and tweets by President Trump seemingly
directed at the title. In the current climate, where
one of the mass shooters parroted anti-immigrant
talking points of the right in an online manifesto
while another espoused violent left-wing ideology,
the film formerly titled Red State vs. Blue State
seemed to throw a match on gasoline. By Aug. 10,
the studio had scrapped the release entirely, leav-
ing its future in limbo (sources in the international
film community say they are still
interested in releasing it).
It’s not clear why the studio agreed
to make the $18 million film with-
out toning down or removing the
political references, given that other
studios passed on the material as
too hot-button. Sources say multiple
Universal executives had reserva-
tions about the project when leadersA large portion
of Disney’s huge gain
comes via the channels
it purchased from
the former 21st Century
Fox while AT&T, parent
of DirecTV, similarly
benefited from its
acquisition of what’s now
called WarnerMedia,
along with its purchase
of AppNexus.$1.84BAT&TDISNEYCOMCASTCBSDISCOVERYVIACOMFOX CORP.Revenue % change from a year ago+179%+69%+14%+7%+4%+2%-6%$3.36B$1.89B$1.42B$1.62B$1.23B$918M Source: Quarterly financial reports. % are calendar Q2 2019 vs. Q2 2018