Is this really the beginning of the end for Hollywood? Unless the studios begin to do some dramatic things to stop its current slide, many analysts and experts agree that Hollywood, as it is currently constructed, just may be doomed. Regardless of the fact that most of what the Hollywood studios produce every year is mindless drivel, there are competition challenges, as well as shifting generational tastes, that Hollywood really isn’t recognizing, never mind dealing with.
Some of the major studios have begun to recognize certain trends and are trying to put together business models designed to meet those trends. Recently, a half dozen of so major studios have begun to flesh out plans to offer first run theatrical releases on live streaming on-demand services months before they would be scheduled to be released on such platforms. Some plans call for releasing the films a mere 17 days after they hit the multiplexes.
The former CEO at Arstisan Entertainment, and current managing principal at Qualia Capital, Amir Malin, observes that, “The major studios have not been choreographed or run to be entrepreneurial. It’s a system that’s been intoxicated with a ‘cover my ass’ mentality. Simply put, it’s a defective system, and when a business paradigm is defective, very good people start doing things that are counterproductive.”
Everyone in the feature film food chain, from producers to directors, to cinematographers, to theater owners, are worried that Hollywood is not going to be able to move quickly enough to stop the bleeding. The studios are gigantic and slow moving sloths that are not built to pivot quickly in the lightning fast business world that is the early part of the 21st Century. The challenges are two fold for the studios and the business. The first is that the financial models are beginning to collapse and the teens, the 20 somethings and the 30 somethings are looking more for immediate delivery and streamable content that they can view on their tablets and cell phones.
Money and capital that had been arriving from China has all but evaporated. The Chinese politicians have been clamping down on foreign investment and have, once again, placed severe restrictions with regard to how many foreign films may enter the country in a particular year. Also, no longer are the days when the heads of the studios ruled over Hollywood with their proverbial iron fists. Content production has truly become entreprenurial and the smaller companies are nimble enough to grab large market shares and threaten the studios.
While many of the younger generations will tend to turn out for what passes for Hollywood blockbusters these days; Star Wars, superheroes, as well as explosions, murder and mayhem all in the name of Good, it all just may not be enough for the Hollywood studios to continue being the decision makers they have always been. It seems that only time will tell and, time for right now, shifts like quicksand. What may be the model to go with today may have to be scrapped in three or four months to adapt to what is happening in content development and distribution at that particular time.
One producer, Mike DeLuca, observes that, “I do worry that we’ll get to a point where today’s tentpoles grow so homogenized that movie-going will radically drop off. But before that happens, I hope more studios learn to chew gum and walk at same time — that they produce not only tentpoles, but invest in original, diverse storytelling as well. It’s the Wild West in terms of content. All the old traditions and formats are up for grabs.”
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