Top of the big era

"your things?"

Kevin Tsujihara was stunned for a moment, not quite understanding.

Zhou Buqi said matter-of-factly: "MGM is mine. What MGM throws away is, of course, what I throw away. I have already promised Bob that I will restore MGM's glory!"

"Bob?"

"Bob Friedman was formerly the chairman and CEO of Summit Entertainment. Now that the company has been acquired by me, his team will be in charge of MGM."

Kevin Tsujihara nodded and sighed, "MGM's history is too complicated, and many things have happened decades ago."

Zhou Buqi waved his hand and said calmly: "Yes, history. In 1986, all the film rights of MGM were taken away by Warner. But you are right, these things are too long ago. I only focus on "The Devil" "The Ring" and "The Hobbit."

MGM went through ups and downs back then.

In 1986, Turner Media Group, a well-known cable TV network, acquired MGM, intercepted all of MGM's film and television copyrights, filled these contents into Turner Television Network's film library, and then transferred MGM's Sold.

Capital operations are very smooth.

Later, Warner Group and Turner Group merged, and this part of the copyright became Warner's assets.

However, it’s not too bad for MGM.

After MGM was sold by Turner, because it had no film library, in order to replenish its film library, it acquired United Artists Pictures, whose performance was getting worse. United Artists Pictures is also one of the eight well-known traditional Hollywood studios, with a film library of more than 4,000 films.

More importantly, United Artists Pictures has two very important intangible assets-the copyrights of the "007" and "Lord of the Rings" series!

These are the two trump cards that MGM relies on most.

There are several novels in the "Lord of the Rings" series. United Artists Pictures bought the copyrights of the two novels "The Lord of the Rings" and "The Hobbit" and all related copyrights for 10,000 pounds, and the profits must be divided 7.5% goes to the Tolkien Foundation.

Later, United Artists Pictures sold the film production rights to producer Sal, retaining the film distribution rights and the production and distribution rights of the TV series.

Sal then sold the first rights to the film production rights to Harvey Weinstein.

In the 1990s, Harvey and Sal found director Peter Jackson and contacted New Line Cinema to launch the "Lord of the Rings" project. New Line Cinema is a subsidiary of Warner...

Therefore, the production rights of the "Lord of the Rings" trilogy fell into the hands of Warner.

At that time, MGM was very weak, with little say and no money to invest, so it had no choice but to give up its distribution rights, which turned into a 6% profit dividend.

Depend on!

This is so shabby!

Hollywood is different from China. Domestic movies have only one way to make money, and that is theatrical release. Hollywood movies have many channels to make money, and they are distributed globally. The workload is huge and complex, so distribution rights are crucial.

Generally speaking, distribution rights and production rights are equal.

Hollywood's distribution commissions from different channels are usually 15%-50% of total revenue. If converted into net profit, it is basically 50%, split equally between the producer and the distributor.

For example, in the theater market, the issuer’s commission is 25%.

The production cost of a movie is US$200 million, which is paid by the producer. The issuer also has to invest US$200 million in reciprocal investment. The expenses include remuneration, copy and printing fees, advertising fees, shipping costs, insurance fees, and taxes. The biggest one is advertising fees, that is, publicity expenses.

After the movie is released, the distributor gets 25% of the total box office, the theater gets 50% of the total box office, and the remaining 25% is shared with the producer.

The revenue ratio between the publisher and the producer is 1:1.

Very equal.

This is Hollywood's traditional model, and the specific implementation process will vary in details based on the investment ratios of all parties.

In the cooperation with the "Lord of the Rings" trilogy, MGM suffered a big loss!

Because MGM had no money to invest at that time, the production, promotion, copying, insurance and other expenses of "Lord of the Rings" were all paid by Warner. This caused MGM's dividend ratio to shrink from the theoretical 50%. 6%.

It’s not as good as the Tolkien Foundation’s share!

Zhou Buqi could see Kevin Tsujihara's thoughts and asked again: "Are you speaking for your old club?"

Kevin Tsujihara hesitated for a moment and then admitted, "Warner is very keen to launch the "Hobbit" series. Many of them are my colleagues and friends for many years."

Zhou Buqi smiled and said: "I understand, I should. Hollywood is a society of relationships. Maintaining the connections in the past will be helpful for future work."

Kevin Tsujihara breathed a sigh of relief and was very happy, "Yes! Moreover, I firmly believe that the "Hobbit" series will have a huge boost to Ziweixing Universal's home entertainment business."

Zhou Buqi said: "I still say what I said. I agree with the filming of the "Hobbit" series of movies. However, MGM wants to get back what it has lost!"

"What exactly?"

"In the cooperation with "The Lord of the Rings", MGM gave up distribution rights and only received 6% of the profit dividend as a production partner. This model can be followed."

"Huh?" Kevin Tsujihara was stunned, "MGM didn't pay for it back then!"

Zhou Buqi said: "There is an economic crisis. I know Warner's cash flow is also very tight. If "The Hobbit" is to be made into a movie, Warner does not need to invest a penny. Give up the production rights and get 6% of the profit for nothing. Dividends.”

"This is impossible."

Kevin Tsujihara gave the result immediately.

How can a mere 6% profit dividend satisfy Warner's appetite? Under the economic crisis, Warner's plan is to earn a billion dollars through the "Hobbit" trilogy!

Isn’t this dividend ratio sending beggars away?

Zhou Buqi said: "I think this cooperation method is reasonable. The profits that MGM lost on "Lord of the Rings" will be recovered through "The Hobbit"."

"well!"

Kevin Tsujihara sighed heavily, the big boss has no sincerity in cooperation!

It looks like this project is going to be pornographic!

Zhou Buqi smiled and said: "It doesn't matter, we can talk slowly. MGM's accounts are still frozen, so there is no rush."

…

Ann Sarnoff is different from Kevin Tsujihara. She worked as a television station at Viacom, as president of operations at the WNBA, and also managed the data business at Dow Jones. She has an extraordinary resume and is well-informed. She is a strong woman who understands media, sports, and technology.

Kevin Tsujihara is a conservative Hollywood executive.

Ann Sarnoff was different. She recognized the direction immediately, "Zhou, is the development direction of Ziweixing Global the Internet? To re-deconstruct Hollywood's entertainment business through Internet data analysis?"

Zhou Buqi smiled and said, "This is the future of Hollywood and the only right direction."

"Your charm comes from your confidence."

"Thanks."

"You never wanted to make a Hobbit movie, did you?"

"Oh? How did you tell?"

Zhou Buqi looked like he was smiling but not smiling.

Ann Sarnoff winked, "A woman's sixth sense."

She is almost fifty this year, but she takes good care of herself. It can be seen that she was a very beautiful blonde beauty back then. Moreover, he is a top student who graduated from Harvard Business School.

Zhou Buqi extended an invitation, "Let me treat you to a cup of afternoon tea and let's talk."

"It's an honour."

Ann Sarnoff is very experienced.

When dealing with your boss, the most important thing is to ignore objective factors such as race, color, age, education, status, nationality, marital status, educational background, etc., and just focus on one thing - treat the other person as a man.

This is the key to her success in the workplace over the years.

At the Peninsula Hotel in Beverly Hills, the two were drinking traditional British afternoon tea and chatting alone. Unlike Kevin Tsujihara, Ann Sarnoff is the assistant to the chairman and a confidant who can speak the truth frankly.

Zhou Buqi said: "It's such a loss to make a movie!"

"deficit?"

"I've seen the profit sharing ratio of "The Lord of the Rings". 7.5% will be distributed to the Tolkien Foundation, 6% to MGM, 5% to producer Sal, and 5% to the producer. Victoria. In addition, there are the executive production team, director team and actors. After all, Warner has to pay out 25% of the profits as dividends. For historical reasons, the copyright relationship is too messy, and everyone wants to come in and get a piece of the pie. By the way. , you may not know that Warner’s production rights have expired.”

"What's the meaning?"

"The production rights are in the hands of Sal. Warner's production rights were leased from Sal and expired last year. If "The Hobbit" is to be made, Sal and Harvey Weinstein are expected to increase the dividend ratio. .This is too boring.”

As an Internet person, Zhou Buqi hates middlemen and this kind of copyright broker.

"The Hobbit" trilogy, including production fees, publicity fees, copy fees, insurance fees, freight, taxes, etc., the total investment must exceed 1 billion US dollars.

However, the two copyright middlemen, Sal and Harvey, did not pay a penny, and then they could share more than 10% of the profits.

Depend on!

Why?

Hollywood has always been mercenary, as long as it can make money. Professional managers are just seasoned professionals who have smoothed their edges. But Zhou Buqi can't do it. He is the boss, not the manager. The boss has the dignity and pursuit of the boss.

Ann Sarnoff asked: "What should we do? Do we really want a TV series?"

"I think it's okay." Zhou Buqi nodded, "The TV series copyrights of the two books "The Lord of the Rings" and "The Hobbit" are both in the hands of MGM, which is complete. In addition to sharing the money earned with Thor, 7.5% of the King Foundation and the rest belongs to MGM.”

"This..." An Sarnoff gave him a deep look, "Zhou, let me tell you bluntly, from my point of view, even if a movie is made into a movie, a large proportion of the profits will be divided among others, and the rest will The revenue can also far exceed that of the TV series. Based on the global box office of the "Lord of the Rings" trilogy of US$3 billion, the theater distribution alone will be US$1.5 billion. How can the US$1.5 billion gap be bridged when it is made into a TV series? ?”

Zhou Buqi curled his lips and said lightly, "1.5 billion US dollars, is it a lot?"

"Not much?"

Ann Sarnoff was stunned, feeling like he had met a monster.

Zhou Buqi said calmly: "It's not worth mentioning in the capital market."

"Capital market?" Ann Sarnoff was stunned for a moment. Her last job was at Dow Jones on Wall Street. She immediately reacted and exclaimed: "Making a fuss about the stock market?"