Consolidation of entertainment a trend to continue in 2022 – The Hollywood Reporter


The global consolidation of independent production companies, which accelerated in 2021, is expected to continue through 2022 as the global streaming boom increases both demand and budgets for films and TV series.

Beyond the planned multi-billion dollar entertainment mega-merger of Discovery and AT & T’s WarnerMedia, among the biggest content-centric deals of 2021 was the Amazon deal for $ 8.45 billion to buy MGM in May, Reese Witherspoon’s $ 900 million sale of his Hello Sunshine shingle (producer of The morning show and Big little lies) in August to a firm backed by private equity giant Blackstone Group, the October 4 acquisition by Creative Artists Agency of competitor ICM Partners, whose financial details were not disclosed, and the $ 775 million deal dollars with South Korean production giant CJ Entertainment – the company behind Parasite – to acquire an 80% stake in the scripted activity of Endeavor Content, unveiled on November 18.

It can all be seen as a reaction to a shift in power in the industry as streaming and other digital entertainment gain importance and traditional revenue streams, including the cinematic box office, become less important. Amazon’s deal with MGM gives Jeff Bezos’ global conglomerate and his Amazon Prime streaming service a full library of film and TV content, including the James Bond franchise.

The Hello Sunshine deal, valued at $ 900 million, led by former Disney executives Kevin Mayer and Tom Staggs, was followed by a deal on November 4 to buy children’s entertainment group Moonbug Entertainment, producer of CoComelon and Blippi, for an announced amount of $ 3 billion, and a deal, valued at around $ 50 million, and slated to close in early 2022, to purchase Faraway Road Productions, the Israeli company behind Fauda and Hit and run.

Contenders are also reportedly considering other top production groups, from Imagine and Legendary to Lebron James’ SpringHill Entertainment.

The CJ / Endeavor merger is an opportunity for both companies to increase their production potential and take a larger share of the growing license and commission revenues from streamers. Agreement and access to Endeavor’s library of content, including blockbuster series Kill Eve and Normal people and movies such as Just mercy and Reading Club, will also help CJ roll out its South Korean streaming service TVING worldwide.

“This transaction further underscores the enduring value of talent and premium content,” said Endeavor CEO Ariel Emanuel.

For CAA and ICM, matchmaking is a way to maintain influence over top talent – CAA clients include Scarlett Johansson, Ryan Murphy and Meryl Streep, ICM’s roster includes Shonda Rhimes, Samuel L. Jackson and Regina King – especially as a result of new deals between agencies and the Writers Guild of America has banned so-called packaging deals. CAA Co-Chair Bryan Lourd recently spoke on behalf of CAA client Johansson when the actress sued Walt Disney Co. for its compensation for Black Widow after Disney simultaneously released the Marvel movie in theaters and on its Disney + streaming platform.

But the push to go big or come home extends beyond Hollywood’s powerful actors. Around the world, independent television and film companies are joining forces or being bought out, as the streaming revolution transforms the industry. Recent acquisitions include Sony Picture Television’s December 1 takeover of fast-growing UK production group Bad Wolf, the company behind the HBO / BBC fantasy series. Its dark materials and police drama The night of (a deal valued at around $ 80 million); the July 5 agreement of French Mediawan (Call my agent!) and the German studios Leonine (Dark) to take a 51 percent stake in UK TV shingle Drama Republic (Doctor Foster); Acquisition by Fremantle of Abot Hameiri, the Israeli production company behind international dramatic success Shtisel, in April of this year; and ITV Studios taking a majority stake in Danish company Apple Tree Productions, the company founded by The slaughter producer Piv Bernth, in March.

BBC Studios, the business arm of the UK public broadcaster, has quietly been gobbling up independent production companies for several years now, most recently (December 14) taking full control of House Productions, producers of Benedict Cumberbatch-starrer Brexit: the uncivil warr and the next BBC miniseries Sherwood. The deal follows similar buyouts (in January 2021) of independent TV hit producers Clerkenwell Films Unsuitable and The end of the fucking world, and Mr. Jacques Lookout Point producers (in 2018). BBC Studios also owns a 73 percent stake in Steve Coogan’s Baby Cow.

Independent production giants ITV, Fremantle and Banijay have long played the game of consolidation: ITV has some 60 production labels in 12 different countries, Fremantle oversees some 40 independent entities in 20 territories, and Banijay, whose takeover Endemol for $ 2.2 billion Last year, Shine made it the biggest of the 800-pound gorillas, has 120 shingles in 22 territories.

New players following their global model include Real detective and Mr. Robot producer Anonymous Content, who has created joint ventures in the UK (Chapter One), Scandinavia (AC Nordic) and South America (AC Brazil) and announced on November 29 the launch of a France-based TV label Anonymous / Federation with the European company Federation Entertainment, producer of the French hit Office.

Alongside Sony – which adds Bad Wolf to its growing stable of UK drama companies, which include The crown producer Left Bank Pictures and Sex education shingle Eleven – ViacomCBS has also been active in foreclosing global production partnerships, although Viacom deals generally fall short of full buyouts. Recent deals include ViacomCBS’s December 7 deal with CJ Entertainment, which will see the pair co-develop and co-fund scripted series and films, many of which will likely end up on streamer ViacomCBS Paramount +, which will launch in South Korea l ‘next year. ViacomCBS entered into a similar co-production agreement on July 19 with Italian Leone Film Group (Paolo Genovese’s film Perfect strangers) which will ensure a constant flow of Italian content targeting both local networks and global streamers.

The demand for content and the resulting pressure on production companies to grow is only expected to increase in the years to come. On December 9, ITV presented an ambitious five-year plan that would see the company double its number of high-end scripted hours from 200 to 400 by 2026, as well as a near-doubling of the proportion of its total revenue coming from streamers. at about 25 percent. ITV CEO Carolyn McCall said the goals were “broadly in line with the global content market,” an indication of the company’s direction

ViacomCBS seems to agree. In May, CEO Bob Bakish and President Shari Redstone predicted the group’s global streaming revenue to exceed $ 7 billion by 2024 as Paramount + and its ad-supported Pluto TV platform roll out worldwide. .

In its annual review of the media and entertainment industry, PricewaterhouseCoopers predicts that OTT streaming or video revenue will reach $ 94 billion by 2025, a 60% jump from 2020 figures.

On the independent film side, an alternative model comes from The Creatives, a new alliance, announced on November 22, which would see some of the world’s most prestigious arthouse producers join forces to co-develop a list of premium movies and dramas. series. Led by Haut Et Court in France, whose credits include the 2015 film by Yorgos Lanthimos Lobster and the Franco-Israeli series No Man’s Land, The creations will include No Man’s Land Israeli co-producers Spiro Films and Lobsterthe Dutch co-producer of Lemming Film, Versus Production in Belgium and Masha Productions in the United States, as well as the German group Razor Film (Quo Vadis, Aïda?), the Norwegian group Maipo Film (State of happiness), the French company Unity, which produced the Netflix drama mythomaniac, and the British shingle Good Chaos, whose upcoming feature films include Ruben Ostlund Triangle of sadness. Les Creatives has signed a three-year partnership with Fremantle to develop and fund high-end drama series. Haut Et Court co-founder Carole Scotta said the new cooperative model would help “protect the independent development process that has been the backbone of storytelling in Europe for decades. We come together to stay as free and creative as possible, and deliver movies and series that audiences will respond to.

Expect 2022 to bring more corporate connections and more creative cooperation models as players in the global production industry position themselves to capitalize on the next wave of streaming expansion, driven so much by the international deployment of platforms supported by studios (HBO Max, Paramount +, Peacock) and by regional players with pan-national ambitions, from TVING in Korea to the Scandinavian streamer Viplay via Canal + in France.

But bigger doesn’t always mean better. The April 2020 merger between scammers and Bad moms producer STX Entertainment and Mumbai-based Eros International lasted barely a year, before STX, which lacks a solid TV operation or extensive library to supply streamers, sold for $ 173million. dollars, to Phoenix-based Jahm Najafi’s The Najafi Companies, in a deal announced on Dec. 7.

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