Heads Up Hollywood

Sony Corporation pioneered the videotape format 30 years ago.

Since then, in addition to watching TV and movie theaters, film and television works also have videotapes.

The "Beta" video recorder developed by Sony sold 100,000 units in just two years.

As a result, Sony has become a world-leading technology company in one fell swoop!

Unexpectedly, two years later, Panasonic started anew and launched VHS format video tapes and recorders.

Although the quality of the "Beta" video recorder is better, but due to the format monopoly and high price, it completely lost to Panasonic in the market within a few years.

The video tape is obviously an image format developed by Sony, but it was picked by a rising star.

A few years ago, Sony also developed a "PVR" based on a TV set-top box, a hard disk that stores TV programs.

Through this kind of hard disk, viewers can copy TV programs to the hard disk without being limited by the broadcasting time of TV programs for viewing at other times.

With the VCR business stagnating, the DVD player business saturated, and the Walkman business dying, Sony urgently needs a product that can lead the global technology scene.

The "PVR" hard drive has high hopes.

However, the sales of this product in the past 3 years have not been ideal. Although the sales growth rate exceeds that of DVD projectors, there are only 1 million users worldwide.

Sorry for the huge research and development funds that Sony paid.

All kinds of business failures have implicated Sony's stock price to fall year after year.

Sony, which had a market value of US$200 billion back then, now has a market value of only US$35 billion.

If you want to save the crisis, you must have a new key business!

Sony's eyes are directed at the next image format after video tapes and DVDs - Blu-ray.

Only by winning this format battle will it be possible for Sony to return to the ranks of the world's top technology companies.

The film copyright library is the key to winning the format dispute.

In fact, as early as three years ago, when the concept of the next-generation high-definition format was first proposed, Howard Stringer, CEO of Sony America, proposed to acquire MGM.

Not only can Columbia Pictures and MGM Pictures join forces to increase the territory of film and television entertainment.

It can pave the way for the future.

However, Sony America is only a branch of the Sony Group.

The power of Sony is in the hands of the Japanese Nobuo Idei.

At that time, Sony's market value was more than 200 billion U.S. dollars, and it was as easy as spitting to eat MGM.

However, Nobuyuki Idei, the CEO, has a narrow structure. He doesn't want to see Sony America grow too big, and then suppress Sony headquarters.

Sony is a Japanese company, not an American company!

The Japanese have a strong national sentiment, and even Japanese companies are extremely repellent of foreign capital.

Under such circumstances, Sony Pictures' plan to acquire MGM failed to materialize.

Now, the opportunity has come.

To promote the development of Blu-ray Disc, MGM is almost an inevitable choice.

Howard Stringer brought up the old story again, hoping to buy MGM.

This time, Nobuyuki Idei agreed.

However, Sony has run out of money, and can't wait to sell even the headquarters building to ease the pressure on cash flow.

Howard Stringer had no choice but to contact Comcast, intending to pull in an international consortium to leverage on MGM in the name of a holding company.

It seems to be determined to win!

Unexpectedly, because of Tang En's disruption, Comcast did not accept Sony's plan, but chose to show favor to New Universal.

Nobuyuki Idei's vision is not very good, and he will soon lose power completely and be kicked out by the board of directors.

Howard Stringer, an American, was elected as the first foreign CEO in Sony's history.

The first thing he did when he took office was to buy MGM at all costs!

Here's an opportunity!

Twain can take advantage of this gap to start as soon as possible, and win MGM in one fell swoop before Nobuyuki Idei steps down and Howard Stringer takes power!

Hit a surprise!

"How about the sale plan of Houghton Mifflin Press?" Tang En was not interested in the box office reports of "Daredevil" and "Finding Nemo". "The Departed Walker".

We must settle some important matters as soon as possible.

Barry Diller said: "It is under discussion. Three companies are preparing to bid, and the transaction prices are all around US$2.25 billion."

Tang En waved his hand, "Let's make a decisive decision and sell it quickly. I just got the news from Toshiba that Sony recently held a meeting to expand the board of directors in Japan, and everyone from Sony's US side has gone. We must hurry up and win MGM!"

Barry Diller frowned and said, "Kirk Kerkorian is very difficult to deal with!"

"How much does he charge?"

"No. But Time Warner's $3.8 billion bid was rejected."

"A stinky, shameless old bastard, he is really greedy! He has plagued Hollywood for decades, and he wants to suck blood. Sooner or later, I will teach him a lesson!" Tang En sneered, closed his eyes and pondered slightly, and said decisively, "No matter what, it's done. Him! $4 billion is not enough, just $4.5 billion!"

"So tall?" Barry Diller's complexion changed slightly.

The current market value of MGM Pictures is only 3.2 billion U.S. dollars. According to the normal cash acquisition practice, the premium is 20%, and 3.8 billion U.S. dollars is about the same.

MGM's performance is so poor, no matter how high the price is, the lion will open its mouth.

If the asking price reaches US$4.5 billion, it will be a 50% premium. This is an acquisition offer that can only be obtained by a company with great development prospects.

Tang En said: "There is no other way, it's not too late. If Sony's Blu-ray technology is really developed and formed, they are determined to beat MGM, and the price may be even higher. Now, Comcast has rejected Sony's cooperation invitation, This is an opportunity for us to jump in."

"MGM is not worth that much money." Barry Diller shook his head frequently.

Tang En smiled and said: "Don't worry, the "007" series is in the hands of MGM, and it's just like jade and dust. The money spent now will be earned back in the future."

Half an hour later, Tang En called Kevin Turner over again, "How about the streaming media rights?"

This is Kevin Turner's most important job right now.

"We have reached an agreement with Warner Bros., Twentieth Century Fox, DreamWorks, Lionsgate and 16 other independent film companies. We have now obtained the streaming rights of 8,000 films. The agreed lease period must be determined. for 25 years."

"good!"

Tang En was very satisfied with the result.

There are a total of about 16,000 films in Hollywood's movie library.

Warner Bros. has the most with 6,500; followed by MGM with 4,200; then Universal Pictures with 3,600, Sony Pictures with 3,500, Twentieth Century Fox with 2,000, Paramount with 1,000, and Disney with 500. and 3,800 from several other independent film companies. (Some video copyright is divided into several parts, so there is duplication.)

Now, Kevin Turner has secured 8,000 film copyrights, which is equivalent to half of the entire Hollywood!

If New Universal can successfully acquire MGM, plus MGM's film library, after removing the redundancy, Netflix will almost be able to obtain about 80% of Hollywood's movie streaming rights!

Such a rich film library resource is enough!

This will greatly benefit Netflix's streaming business in the future.

Kevin Turner was very dissatisfied, "The number of years we asked for is too long, a 25-year contract... Unless it is a company that is in urgent need of money like DreamWorks and Warner Bros., it will cooperate with us. Many film companies and content providers , are unwilling to sign such a long lease agreement."

Tang En said with a smile: "8,000 movies are already enough, including our own, it will be enough to support Netflix's streaming business in the future."

Kevin Turner frowned and said: "But... currently Netflix has as many as 30,000 DVD film and television copyrights! Blockbuster has even more, as many as 75,000!"

Copyright law in the United States is rather strange.

Party B must sign a contract with Party A for related copyrights such as Internet copyrights and adaptation copyrights, and can use them only after obtaining permission.

But DVD rights are different.

As long as Party B purchases the genuine DVD video disc issued by Party A, it can carry out various commercial activities on its own, as long as it provides enough profit dividends.

Unless New Universal and Disney block Blockbuster by name, Blockbuster is not allowed to use DVDs from New Universal and Disney for commercial activities.

Netflix owns 30,000 DVD movie rights, and except for almost all Hollywood movies, the rest are foreign movies and very low-budget American movies.

This is also the reason why the CD rental business is easy to develop, while the streaming media business needs a lot of financing to develop.

Tang En heard some meaning from Kevin Turner's words, he laughed dumbfounded, and waved his hand, "Speak up if you have something to say!"

Kevin Turner said with a smile: "I think that the acquisition of streaming media copyrights must persist and become bigger and bigger! The rental records of Netflix users tell us that they love excellent foreign movies, no less in our Hollywood films."

Tang En pondered and said: "Well, excellent overseas movies are indeed of high value. For Hollywood, this is a blind spot, and it is an opportunity for us to take advantage of it and make arrangements as soon as possible. However, for overseas film companies , we don’t have to be as polite as we treat Hollywood studios, we need to change our strategy.”

"Change strategy?"

"That's right. Hollywood movies are regarded as treasures by major companies, and they are usually only rented and not sold. Overseas movies... They have no right to speak, and they have no future expectations. We can be tougher and only buy out, not Lease!"

Kevin Turner opened his eyes, "Buy out the streaming rights?"

"No!"

Tang En waved his hand, and said calmly: "It can be like this, we first ask to buy out all the copyrights of the movie. If they don't agree, we will go back to the next best thing and only buy out the streaming media rights."

"It's going to cost a lot of money, I'm afraid."

Kevin Turner hesitated.