Welcome back to What I’m Hearing, and best wishes to Pete Davidson, Kevin
Hart, Aziz Ansari, and all the A-list comics traveling to Saudi Arabia for the “Riyadh Comedy Festival.” No big deal that the kingdom just executed another journalist, or that Human Rights
Watch condemned the “whitewashing” event. I’m sure the seven-figure checks cleared in advance, and you will almost certainly remain not beheaded during your stay. Congrats also to WME’s Mike Berkowitz, CAA’s Matt Blake, and all the touring agents who booked the acts and can luxuriate in those sweet
Saudi commissions. It’s not show conscience, it’s show business!
Tonight, I assess the Jimmy Kimmel Blast Radius and how each of the key players comes out of the saga. Plus, David Ellison’s plans for Warner Bros. Discovery take shape with the arrival of Makan Delrahim (whom I once put on the sexiest Hollywood Reporter cover ever), and we’ve got a new participant in Amazon’s ongoing game of executive musical chairs.
Discussed in this issue: Bob Iger, David Ellison, Makan Delrahim, Peter Friedlander, Rupert Murdoch, Leo DiCaprio,
Perry Sook, Blair Effron, Dana Walden, Rob Mills, Vernon Sanders, Brendan Carr, Dave Chappelle, David Zaslav, Chris McCarthy, Kristina Schake, Jimmy Kimmel, Paul Thomas Anderson, Gerry Cardinale, and… explosive diarrhea.
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- Ellison’s
Warner Bros. playmaker: Today’s hiring of Makan Delrahim as Paramount’s new chief legal officer is the clearest sign yet that David Ellison really wants Warner Bros. Discovery. Who knows better than Delrahim, the top antitrust enforcer at the Department of Justice in the first Trump term, how to push a deal through the current administration? He also evaluated and greenlit Rupert Murdoch’s 2019 sale of his Fox
assets to Disney, making him the perfect shepherd for what will likely be a very loud and winding regulatory path to the reduction of five legacy Hollywood studios to four. Sigh…
To that end, Ellison has been keeping the contours of the WBD bid secret, even from others at the company who would normally be looped in. That includes whether the bid has actually been submitted. I personally think it has, but Paramount would not confirm. (Ellison’s being advised by Paramount board
member/investor Gerry Cardinale at RedBird and Blair Effron at Centerview Partners.)
The open questions include the amount of the offer, where exactly the $50 billion or so is coming from—Larry’s couch change or some combination of Dad and other investors?—and whether Warner Discovery C.E.O. David Zaslav can conjure up other bidders or do anything to put off the sale until at least after his planned split of the
company into good (the studio and HBO Max) and bad (the TV networks and their Savannah Bananas sports rights). Paramount declined to comment. - More on Ellison’s antitrust playbook: With Hollywood on edge about further consolidation, people close to Ellison are already saying any WBD purchase would not involve “closing” the Warners studio. Ellison’s strategy, they say, is to maintain the film slate at the planned 15 theatrical movies per year at
Paramount and add about 15 or so per year from Warner Bros. Yes, it’s easy to say that when everyone is freaking out, but part of Ellison’s attraction to Warners is leveraging its I.P. trove to build out an industry-leading slate of franchise films, which would include doubling down on theatrical releases. Combining Paramount+ and HBO Max would similarly take two very different streamers with complementary specialties and customer bases and create an actual competitor to Netflix, Amazon, and
Disney. Those are the behemoths to worry about, Ellison would argue, not little ole Paramount.
And that’s where Delrahim comes in. If you remember, he greenlit the Fox/Disney deal despite the fact that it was a “horizontal” merger among rivals—he felt there was enough competition out there, with Netflix and Apple and Amazon now battling the traditional studios. He and his lawyers (Delrahim advised Paramount at Latham & Watkins before going in-house) would likely make the same
argument for a Par-WBD integration, adding that while a combined Paramount+ and HBO Max would boast more subscribers than Disney+, the entity would still lag behind Netflix and Amazon among S.V.O.D.s. It would also trail far behind YouTube in engagement and revenue.
Delrahim’s job will also entail arguing against other potential suitors for the Warner assets, if they ever materialize—a big if, despite Zaslav’s efforts. Paramount will likely also argue that Big Tech
bidders would face uphill battles related to their power in online marketplaces, stricter antitrust rules in the E.U., and potential predatory pricing issues. Imagine if a company like Amazon—already an F.T.C. antitrust target—goes after Warners and ends up giving HBO Max away to Prime members. Netflix, which already boasts more than 300 million subscribers, could be seen as running away with the streaming market if HBO Max and its soon-to-be 150 million subs join the fold. There’s some Supreme
Court precedent that mergers are presumed illegal if the combined entity controls more than 30 percent of a market, though that depends on the definition of a market, which would be a key question in the streaming wars.
Or at least those would be the arguments. Ultimately, I think Ellison plans to create a massive, two-studio content and streaming conglomerate with Oracle as its technology partner and possible access to TikTok as a distribution and promotion platform. A scary prospect for
everyone used to Paramount and Warner Bros. operating for more than 100 years as rivals. But, as we know, the Hollywood of the legacy studio oligopoly is coming to an end, and a combined ParBros, a Skydance Corporation, might even be enough to scare Amazon or Netflix, if the government plays along—which, given Ellison’s recent Trumpy moves and now the hiring of the president’s former antitrust guru, it seems likely to do. Is that why Reed Hastings, the longtime liberal Democrat
and Netflix board chair, came out in favor of Trump’s plan to charge $100,000 for H-1B visas? Maybe he fears the Ellison playbook and wants to write his own chapter.
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- Speaking
of Paramount+ and HBO Max…: Maybe if those two services came together they could start to solve their biggest problem: People don’t go there. According to a new study on streaming habits from Wolfe Research, only 3 percent of consumers combined fire up the Paramount and Warner Discovery services first when they don’t know what to watch. Netflix dominates, of course, and Peacock needs similar help…
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- Amazon
fills its cart with a Netflix exec: A big welcome to Peter Friedlander, who just joined Amazon’s ongoing game of executive musical chairs. He takes the head of global TV gig from Vernon Sanders, who was left standing when the music last stopped. As I teased last week, this was the obvious hire for Prime Video chief Mike Hopkins. Friedlander has proven taste and a track record of hits in 14 years at Netflix, the dominant player. And unlike
Chris McCarthy, the ex-Paramount exec whom Hopkins also considered, Friedlander is a hall-walker type with generally good talent and agency relationships who can hopefully help fix the Amazon staff morale problems.
- Box office over/under: Tracking for Warner Bros.’s One Battle After Another, which I liked a lot, has it between $19 million (NRG) and the mid-$20 millions from other services. Neither is good for a $130
million–plus Leo DiCaprio dramedy, but reviews are very strong. Still, no Paul Thomas Anderson movie has grossed more than $77 million total worldwide, so let’s set the line at a $23 million debut and I’ll take the under.
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Now on to the damage assessment from the Kimmel bomb… |
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Assessing the winners, losers, and survivors of the biggest
political-media feud in recent Hollywood history. |
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Jimmy Kimmel may be back on ABC, but the fallout from a week of international outrage and
political jockeying over his removal is far from settled. So let’s measure the blast radius to see how each of the key participants has fared, and what their ultimate fallout might be, starting, of course, with… |
Bob Iger: The Disney C.E.O. will likely enjoy a nice Brentwood weekend basking in the cheers around town and in left-leaning media circles. The fact that Kimmel hit his Tuesday
monologue out of the park only added to the feeling in the business and creative communities that Iger ultimately made the right call in defying Trump and the F.C.C. and bringing him back, despite the Sinclair and Nexstar stations refusing to air the show in 23 percent of the country. Cue the hero’s parade down Main Street, USA.
But… let’s be honest, this was a major fuck-up, a mishandling of an admittedly difficult situation and a misjudgment of the potentially brand-damaging backlash to
Disney. So, yeah, the whole Kimmel thing—which is far from over—is gonna be added to the ABC News settlement and stick to Iger and his legacy, even if he ultimately made the right move in the end. “This shouldn’t be confused for Disney or Iger suddenly rediscovering their moral high ground,” Bloomberg’s Beth Kowitt wrote yesterday. “Instead, it’s a realization that submitting may come with a higher price than pushing back.”
Media companies like Disney are learning they must identify a line that they won’t cross when it comes to dealing with Trump. Iger didn’t have one; now, that line has been forced upon him. That’s not a sign of strong leadership, and it got him a
rebuke from shareholders in the form of legal letters asking him to turn over board documents related to the decision.
I hate to do this, but would Netflix co-C.E.O. Ted Sarandos have allowed this situation to escalate? I’m guessing no. It’s not apples-to-apples, of course, and
Netflix has censored objectionable content to comply with government demands overseas. But in the U.S., Sarandos faced his own comedian blowup when Dave Chappelle released a hateful special targeting transgender people, in 2021, at the height of cultural sensitivities. Instead of setting a precedent he might later regret, Sarandos defied the so-called “woke mob,” including many of his own employees, and stood behind Chappelle amid many calls to cancel Netflix. The
outrage passed and Sarandos had made a firm statement: Come at us, we won’t cave. And since then, nobody really has.
Iger didn’t do that. His issues with affiliates and the F.C.C. licenses are more complicated, and he’s got major deals pending with the government, but the conflict is the same: Long-term brand management vs. short-term business gain. Lots of people told Bob last year that paying $16 million to settle the ABC News case, choosing temporary de-escalation over the emboldenment
of a famously relentless adversary, would be a mistake. Iger should have known Trump wouldn’t just go away, and he should have known Kimmel would quickly become a global martyr for free speech.
Even Michael Eisner knew that. It’s weird; Iger and Eisner share Clippers tickets and were pictured together at a playoff game as recently as this April. Five months later, Eisner is crapping on his supposed friend and successor on Twitter. That’s how bad it got. And now, Trump is
threatening to sue Disney for keeping Kimmel on the air. Why wouldn’t he? Iger basically told him to. |
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Dana Walden: Disney’s TV chief is the most interesting player here. Obviously, Walden and
late-night exec Rob Mills presided over a major international scandal in her division—wait, scandal’s the wrong word… I’d call it a significant blowup—and the highlights certainly won’t be included in her sizzle reel to become Disney C.E.O. As a longtime Disney observer noted to me this week, the company’s board members are already wary of her close ties to Kamala Harris, which became an issue during the 2024 campaign. If Walden ascends next
year to the top job at Disney, it could spark additional backlash and harassment from Trump. With a viable alternative candidate in parks chief Josh D’Amaro, maybe this helps tip the scale to him.
But… while Walden had the most to lose if Kimmel didn’t come back—first off, I’m guessing Iger would have donned a Captain America mask and used her as an image-protecting shield—Kimmel did return. And according to multiple sources, Walden was an especially influential
voice over the weekend in walking her late-night star back from the ledge, proving yet again that talent relationships do matter. So if everything calms down and the affiliates return shortly, maybe this saga actually turns into a positive example of her crisis-management skills. Maybe…
Chris Ripley & Perry Sook: The Sinclair Broadcast Group and Nexstar Media Group C.E.O.s now find themselves in a tough spot. Disney has publicly stood up to them, and as the owner
of the valuable content that powers the station business, it carries tremendous leverage. I seriously doubt Iger would pull football or other key programming, but he could. And, as Eriq Gardner explained on The Town, the affiliates can’t boycott ABC shows indefinitely without showing that the content is not
appropriate for their market—a hard argument to make for stations that have been airing Jimmy Kimmel Live! for 23 years.
Instead, the stations are likely strategizing a path back to airing the show while trying not to enrage Trump and F.C.C. Chair Brendan Carr, who holds sway over Nexstar’s pending $6.2 billion merger with Tegna. Hence, Nexstar’s cautionary statement yesterday that it was having “productive discussions” with Disney, “with a focus on
ensuring the program reflects and respects the diverse interests of the communities we serve.”
Honestly, the record-setting, 21 million-views-and-counting performance of the Kimmel monologue on YouTube should scare the crap out of these station owners. Nowadays, even if they preempt the content, viewers just find it fast elsewhere, and Disney knows this. So I’d argue that Sinclair, Nexstar, and other affiliates actually carry a little less leverage in negotiations today than they did
before the Kimmel blowup. And, if you’re keeping score, that Charlie Kirk memorial news special that Sinclair planned to air in Kimmel’s place but instead put on YouTube? It’s at just 71,000 views as of tonight. |
Brendan Carr: At this point, I think Carr probably realizes that he overstepped in overtly
threatening Disney with his “easy way or the hard way” tirade. He’s walked that back, and he’s been relatively silent (for him) since Kimmel returned. (Maybe South Park giving him “explosive diarrhea” humbled him a little.) It’s still very possible that Disney will feel the F.C.C. wrath when Carr intervenes in its purchases of Fubo or NFL Media, two deals that are very important to the future of its ESPN division.
But it’s hard to argue against free speech, which is what
Carr was essentially doing, and the whole national dialogue changed when right-wing stars like Ted Cruz and Rand Paul turned against Carr, even amid many, like Ron DeSantis, who were equating the F.C.C.’s threats against Kimmel with how the Biden administration pressured Google. Iger and Walden should send Cruz some monogrammed Mickey ears.
Kristina Schake & Disney/ABC P.R.: Lots of voices went into Disney’s initial press
statement pulling Kimmel, but the company’s chief communications officer ultimately bears responsibility for what now appears to have been the most regrettable P.R. misstep: preempting Jimmy Kimmel Live! “indefinitely” in a seven-word public statement, without explanation or a “we love and support Jimmy” or a “temporarily as we work to find a solution” bit or anything that might lead to an interpretation other than that the show was finished. Trump sure thought it was toast, celebrating
Kimmel being “Cancelled!!” (the two exclamation points are his), and so did many in the media and online.
I know, there wasn’t a lot of time last Wednesday because the audience for Jimmy Kimmel Live! was being seated amid the impasse with the host. And communications people can only do so much, especially with strong-willed bosses. (Walden herself is a former publicist.) But what differentiates good comms at that highest level is the influence to steer a messaging conversation
internally and ultimately save the bosses from themselves. As several P.R. pros have pointed out to me this week, that first statement is always the most important. This one failed to anticipate how it would be interpreted and the extent of the backlash over free speech, and it immediately put Disney, Iger, and Walden on the defensive. It poured Kingsford on a situation that was already bound to be fiery—the opposite of what good P.R. achieves.
Donald Trump: The
president has been given no reason to believe his war on the media isn’t working. In fact, it is working. But I do think Trump’s focus on removing Kimmel and others from their perches risks alienating the more libertarian wing of MAGA conservatives, not to mention Joe Rogan and the “Manosphere” comics and podcasters who helped him win reelection. They definitely don’t like being told what to say and not say. And any lawsuit over the content of
Jimmy Kimmel Live! would not only lose in court, but Disney, after enduring so much criticism for the ABC News settlement, would be forced to litigate it to victory. So no, it wouldn’t be smart or even reasonable for Trump to continue this war on Kimmel—which is probably why he will continue it. |
Jimmy Kimmel: Kimmel obviously escapes this situation, having boosted his personal brand by
standing up to his bosses, winning the weeklong showdown, and being proven right with a well-reviewed and highly rated return that, at least so far, hasn’t led to the implosion of The Walt Disney Company. (A boost also to Molly McNearney, Danny Ricker, and all the writers; start prepping the Emmy submission for next year.) Now, even if Kimmel’s show teeters on profitability, good luck to Disney if executives want to cancel him. Jimmy has pretty much guaranteed
that he can go out on his own terms, whenever that is.
Kimmel’s staff: Maybe the biggest winners here are the 200-plus employees of Jimmy Kimmel Live!, many of whom were wondering pre-benching if this season would be the show’s last. Now? Hard to believe Kimmel will give Trump and Carr the satisfaction of exiting before they do. |
See you Monday,
Matt
Clarification: The International Women’s Media Foundation insists it
did not discuss moving an upcoming free speech gala from the home of Bob Iger and Willow Bay, as was mentioned in Monday’s email.
Maya Tribbitt contributed research for today’s issue.
Got a question, comment, complaint, or odds on the next indefinite preemption? Email me at Matt@puck.news
or call/text me at 310-804-3198. |
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