CAA co-chair Richard Lovett said the agency’s battle with Warner Bros. and Walt Disney over client compensation – conflicts that in the past have rarely spilled into view publicly – are part of a broad struggle to define value in a streaming landscape where numbers are scarce.
“How do you understand and protect the value of a client? How should a client be paid … when data is something we are chasing,” he said during a Q&A at the WSJ Live conference Tuesday.
“So when Warner Bros. announced late last year that its 2021 film slate would be released day-and-date on HBO Max, “We ended up having to be public in a little bit of a conflict,” Lovett said. And the Walt Disney Co. situation with Scarlett is one that I am not going to comment too much about other than to say that I think our clients want us to fight for them. I think our clients want us to make sure they are protected and that’s what we did.”
Lovett had called the WarnerMedia move a “blindside” and “entirely unacceptable.”
His co-chair Bryan Lourd had slammed Disney for its aggressive response to client Scarlett Johansson’s lawsuit against the company. The actress and Disney recently settled their Black Widow profits litigation over the Marvel film’s release in cinemas and on Disney+ for a premium fee on July 9.
The pandemic “sent us home and sent audiences away from the possibility of going to movie theaters“ just as streaming accelerated, he said, creating ‘a perfect storm,” Lovett said.
“How did this really impact the audience that [subscribes to] a streaming service and how ought a deal to work when you can’t be clear about the back end value because people aren’t just going to theaters? It’s a challenge. Assigning a dollar value to the equation [of what] causes someone to subscribe in the first place, maintain a subscription or spend more time on a platform. Those are complicated things to be precise about.”
Hybrid release models are testing the agency’s intelligence gathering capacity.
“From our vantage point, we have to be really thorough and really expert about data as we can gather it through our CAA intel experts. We’ve got a division working on understanding data from all sources. We have to be really precise in the modeling of the value of these films and track them start to finish… and start to create, cumulatively, a real stockpile of information that helps to fuel our understanding of deal making.”
“We focus on client activities, client impact with audience as well as understanding how a movie performed everywhere as we piece together that puzzle. Streamers are not anxious to share all of their data. They will share some sometimes. We hope that we find a way to understand the partnership in a better way where more data is shared and in the meantime we have got to work really, really hard for our clients to fight for their value and for them to be paid fairly.”
Lovett also said that unlike rival Endeavor, and despite on-and-off speculation, CAA has no plans to go public in the near future. He wasn’t asked and didn’t discuss the recent blockbuster news that CAA is acquiring ICM Partners.