Planning is impossible. It is an excruciating time to be in the entertainment business
Where do we go from here? The entertainment industry has been valiantly hanging on since the start of the global pandemic but how long can Hollywood be expected to hold its breath?
In the interest of protecting the lives of our most vulnerable, the industry adjusted – shuttering live entertainment, theme parks, movie theaters and all production known to mankind. This full-on halt ground on for three aching months. Tens of thousands of entertainment jobs were wiped away. And no amount of PPP funds could soften the blow for a company like Disney – with theme parks and movie releases and TV advertising all in time-out.
Finally, by the second half of June, we were all prepared to step gingerly into this brave new world of modified life. What did that look like? No one was sure. Disneyland was aiming to reopen with temperature checks. TV and movie productions set safety protocols, with studios and guilds inventing new norms on the fly. Movie theaters gamely sought to provide an optimistic outlook – “This will be no problem! We’ll disinfect after every show!” Live music seemed like a distant dream but there were hopes for early 2021.
But now we are into July and the coronavirus numbers are climbing steeply, again. And although death rates remain low and still falling, experts say that we should not expect that to remain the case, as deaths follow infections by some weeks.
It is an excruciating time to be in the entertainment business. We’ve dated and redated all the major summer movie releases, from “Tenet” to “Mulan” to “Wonder Woman 2.” Hundreds of millions of marketing dollars are at play, as is the fate of these major franchises from Warner Bros. and The Walt Disney Co. But the movie theater chains, as well as the Hollywood studios, are beholden to the public health decisions of state officials, and both New York and California pulled way back last week.
So is anyone confident that the new “Tenet” release date – August 16 – will hold? How far into the future can anyone predict anything?
The moment holds far more questions than answers, and the most frustrating part is that we have no more answers than we did in March.
This means that the pressure on companies that depend on communal gathering is intense. Theatrical is bad enough, but live entertainment has it worse, with the attendant implications. Paradigm, with its focus on music, is particularly vulnerable and is on the cusp of being sold at a bargain price, according to my sources.
And those that are also saddled with debt (I’m looking at you, WME-IMG) are now facing life and death decisions. “Live (entertainment) is done until at best the middle of next year,” said one insider who works closely with the sector. He argued that partially-full venues are not worth the risk for promoters. “There is no reason to have shows that can’t make money and have risk.” Already, WME is bleeding agents, like Marc Geiger, and top-rated executive talent, like CMO Bozoma St. John, who went to Netflix last week.
The choices ahead may be existential for some companies as they stretch into a future with no discernible revenue coming in.
The silver lining remains for the industry’s digital businesses. Netflix continues to drive strong engagement, and Disney+ pulled a smart move by launching “Hamilton” on the service during the July 4th weekend. Hulu is soaring, and Lionsgate’s Starz is on a growth ramp, too.
The word from my friends in the television world is that business is strong – demand is as high as it’s ever been – but when can production start?
That may be, as they used to say on TV, the $64,000 question. Except that it’s a whole lot more than that sum at stake.