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Time Warner Chief Jeff Bewkes Says He’s Open To Acquisitions, If Cheap: UBS Confab

Time Warner CEO Jeff Bewkes needed a better joke writer to help him acknowledge the anniversary of the blunder he made at last year’s UBS Annual Global Media and Communications Conference when he wrote off Netflix, comparing it to the Albanian army trying to take over the world. He had to eat those words as Time Warner, along with just about everyone else, began licensing programming to the online streaming service. “This is the appropriate place to point out that the Albanian army did take over the world. Alexander the Great? It’s close.” The line only elicited a few chuckles from analysts, but they didn’t seem to mind after hearing Bewkes say a lot of things they wanted to hear. Time Warner’s ad sales have been ”up double digits (since the upfront market) and are holding.” Although 4Q was a little soft, ”some of that is advertisers pulling stuff forward to the upfront. … We’re looking fine for the first quarter,” especially with the return of NBA games.

He also assured investors that they don’t have to be concerned about Warner Bros’ prospects following the end of the Harry Potter film series. He said that within hours, the Harry Potter presence that has done so much for Universal’s Islands of Adventure park in Orlando “will move in a material way in that direction” — suggesting that the company and Comcast will confirm reports that Universal Studios Hollywood will get a version of The Wizarding World of Harry Potter attraction. ”Everybody stay tuned.” He also says that the studio has high hopes for additional franchises including the Batman/Dark Knight series. Read More »

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Comcast Hints That ‘Harry Potter’ Will Go To Additional Universal Parks: UBS Confab

Comcast CFO Mike Angelakis says that The Wizarding World Of Harry Potter was so successful for Universal Orlando’s Islands of Adventure that it became “a reset mechanism” for the theme park. But he stopped short of confirming reports that the company plans to bring Potter to Universal Studios Hollywood, even as he gave analysts attending the UBS Annual Global Media and Communications Conference every reason to believe that they’re accurate. Indeed, he seemed determined to avoid making news, sticking instead to Comcast’s familiar talking points: He acknowledged that there are “challenges” at NBC but says it’s also ”an opportunty for us,” adding that Comcast is “investing where we can have a level of success.” He vowed to be ”disciplined” in bidding for sports programming, calling Comcast’s agreement in June to pay $4.4B for U.S. broadcast rights to the Olympics from 2014 to 2020 “a smart deal for us.” The company also talked up its new pact to sell wireless spectrum to Verizon Wireless, with the companies cross-selling each other’s products. “We don’t have to build a wireless network,” Comcast Cable CEO Neil Smit says. “We’re thrilled.” He noted that Comcast will be able to sell Verizon Wireless phone services even in markets where the cable company competes with Verizon’s FiOS video and broadband offering.

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Will ‘Avatar’ From Fox Provide Disney With The Theme Park Hit It Needs?

Disney And Fox Unveil Plans To Develop ‘Avatar’ Theme Park Attractions

Disney must be hoping that its new plan to build Avatar theme park attractions will be the shot in the arm the business may need. And, unbelievably, the new feature is coming courtesy of Fox Filmed Entertainment and James Cameron.

On paper, all looks well for Disney’s theme park revenues: they were up 9% to $8.7B for the three quarters that ended July 2, while operating income was up 13% to $1.1B. Also attendance has held steady. But most of the growth was due to Disney’s decision to raise prices for tickets, hotels, food, and merchandise. That probably can’t continue if the economy continues to weaken. Meanwhile, some analysts have been alarmed by the high capital expenditures for parks, which more than doubled to $2.1B in the nine-month period. Disney is still working on the $1.1B upgrade it announced in 2007 for its California Adventure park — it struck many visitors as a cheap, generic amusement park when it opened in 2001.  Disney’s also investing in its Aluani Resort in Hawaii (it opens Thursday), Shanghai Disney Resort for 2016, expansion of the Hong Kong properties, a re-do of Disneyland’s Fantasyland, new cruise ships — and covering increased pension obligations.

Construction and licensing costs for the Avatar attraction from Fox and James Cameron could run about $400M, and there’ll be some revenue sharing for the merchandise. But the new project isn’t expected to change Disney’s forecast for its capital expenditures to peak … Read More »

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Harry Potter Inc: Warner Bros’ $21B Empire

Final Harry Potter Already Wrecking Foreign/Domestic Records

EXCLUSIVE: With history’s most successful movie franchise coming to an end with the Friday release of Harry Potter And The Deathly Hallows Part 2, it’s a good time to ask: How much loot was conjured up en masse? And the answer is startling. You can find about $21 billion by adding up gross sales the series has generated since 1998 from films, videos, video games, licensed merchandise, and books. (See detailed breakdown below.) Time Warner has already seen an estimated $1 billion in profit from the films and its work as custodian of a global entertainment brand. The tally should continue to grow, probably by a lot, with the release tomorrow of Warner Bros’ Harry Potter And The Deathly Hallows – Part 2 — although Hollywood accounting has a way of making profits vanish. (Here‘s how the black magic worked for Harry Potter And The Order Of The Phoenix in a studio accounting statement obtained by Deadline’s Mike Fleming. Though the film grossed $938.2 million worldwide, the document conveys that the film is still $167+ million in the red)

Things have turned out so well that it’s easy to forget what a huge risk Warner seemed to be taking more than a decade ago when it bought the Potter rights. The studio didn’t know how the series would end. And J.K. Rowling, who wrote the series, was a wild card. Many wondered whether U.S. audiences would warm to the all-British movie cast that Rowling required.  “The casting of the kids was the biggest place where it could have gone wrong,” Warner Bros Pictures Group President Jeff Robinov tells me. Some Warner executives also chafed at Rowling’s demands that there be no Potter-related fast food offerings and that Warner show restraint in product licensing. “I can only say now to all the parents out there, if the action figures are horrible, just tell the kids that I said don’t buy them. Sorry, Warners,” Rowling told a 60 Minutes interview.

Virtually everybody agrees now that Rowling was right to keep the franchise faithful to her vision. And Warner was right to embrace that vision down to small details in licensed merchandise. “We had a guideline that was perhaps frustrating to our colleagues in Consumer Products but has held well for us as a company which was to look to create artifacts, not souvenirs,” DC Entertainment President Diane Nelson tells me. She oversaw the Potter franchise from the beginning. Marketing plans also adapted as fans became older and the Potter saga grew darker. “We held on to fans as they aged in a way that’s never been seen before,” Nelson says to me.

Here’s how all of the Potter business decisions have turned out so far:

Movies. The first seven films accounted for nearly $6.4 billion in ticket sales, with 68% of the total coming from overseas, according to Box Office Mojo. The only other franchise that comes close is James Bond: Its 23 films beat Potter if ticket prices are adjusted for inflation.

Home Video. Consumers have spent nearly $3.9 billion globally — with 44% of that coming from the U.S. — to buy 302 million videos of the first six Potter films, Warner says. IHS Screen Digest says that Warner probably collected about $1.5 billion just from domestic video sales, which would more than cover the studio’s estimated $1.4 billion production budget for all eight films. Read More »

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Reliance Bringing Universal Studios Theme Parks To India?

Mike Fleming

The Wall Street Journal reports that Reliance ADA Group is negotiating with Universal Studios to replicate its  movie-themed amusement parks in India. The result would be a $1.5 billion new park that covers 400 acres –in either New Delhi or Mumbai–and would combine Universal park attractions with others devoted to Bollywood films. Universal would take a licensing fee for its branded attractions that include themed attractions involving such Marvel Comics characters as Spider-Man, The Hulk and Doctor Doom–deals made well before theme park rival Disney bought Marvel–as well as Dr. Seuss attractions. There are also the venerable rides based on the films of Reliance’s DreamWorks partner Steven Spielberg–who gets a cut of theme park receipts–with Jaws, E.T. and Jurassic Park. Universal’s Islands of Adventure just opened an entire wing of the park devoted to the Warner Bros franchise Harry Potter, which recently opened after two years of construction, highlighted by a ridiculously ambitious simulator ride housed within a replica of Hogwarts Academy that has been carved into a faux mountainside setting that is as overwhelming as the $200 million I’m told was spent to build it. WSJ qualifies that the deal is in the talking stage, but it would mark Reliance’s latest foray into Hollywood. Besides its partnership with DreamWorks, Reliance made first look deals with the production companies of Brad Pitt, Chris Columbus, Jay Roach, George Clooney, Jim Carrey, Tom Hanks, Ron Howard and Brian Grazer, Nicolas Cage and … Read More »

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