Verizon's Attempt To Woo Millennials Is Equal Parts Creepy, Expensive And Sad

from the hip-cat dept

For some time now Verizon's made it very clear it wants nothing to do with its core fixed-line broadband business. Instead, Verizon's taking a huge bet that it can transform ye olde phone company into a huge advertising and streaming media empire, with a focus on wooing (read: selling ads to) Millennials. To that end Verizon acquired AOL and its ad technology for $4.4 billion last year. It developed a highly-controversial stealth ad tech that can track these youngsters around the Internet without their consent, and it created its own "Go90" streaming video service specifically aimed at Millennials.

More recently, Verizon announced it would be spending $650 million on a 25% stake in AwesomenessTV, a streaming venture aimed at, you guessed it, Millennials. AwesomenessTV was sold to Dreamworks for $33 million just three years ago, but Verizon believes the mark up is worth it, and the acquisition will be the cornerstone of the company's new Millennial sexification efforts:

"We are capitalizing on the emergence of these strong media brands that can reach millennials and Generation Z,” said Brian Angiolet, Verizon’s senior vice president for consumer product and marketing. “It’s like we’re in the early days of cable, and we want to participate more fully in the economics of that trend.”

AwesomenessTV will, moving forward, help feed exclusive content into Verizon's Go90 platform. The problem is that by all appearances, Verizon's Go90 rebranding efforts (which remove the Verizon name entirely in ads) aren't going all that well. Despite Verizon giving away some free, extra wireless gigabytes of data to users that try the service, Go90's ranking on most app stores appears to have only floundered since the initial launch last year. Analysts at firms like UBS aren't impressed either, noting that most Millennials are already getting their video content elsewhere:

"We believe Go90 will be hard-pressed to mount a meaningful challenge to mobile video and social networking leaders YouTube, Facebook, Instagram, Snapchat, Netflix (NFLX) and Hulu,” wrote UBS analyst John Hodulik in the report. “That said, Verizon is pulling various levers to ramp up interest in and usage of Go90, including more live and exclusive content and free data for Verizon Wireless customers."

Even the company's plan to abuse its position as an anti-competitive gatekeeper hasn't really helped. The company gave the FCC and its net neutrality rules a giant middle finger recently by exempting Go90 content from company usage caps, but even this unfair advantage doesn't appear to have lit much of a fire under the initiative. As a result the effort has been mocked by T-Mobile CEO John Legere, who called Go90 a "debacle," that will in time be spoken of alongside things like Amazon and Facebook's failed attempts to sell their own phones.

Keep in mind that Verizon executives, after the departure of former Verizon CEO Ivan Seidenberg, decided to effectively give up on fixed line broadband -- something it was actually marginally good at -- to pursue this new initiative. As such, Verizon stopped expanding FiOS (despite billions in subsidies and tax breaks for fiber never delivered) and began trying to offload or otherwise ignore the company's DSL customers. In some instances, this even meant outright refusing to repair DSL customers hit by natural disasters, citing expense.

Many of these resources were instead diverted to wireless (which makes sense from a ROI and future-proofing perspective). But Verizon executives honestly believe that if they spend enough money they can become an ad empire akin to Facebook or Google. But not even Verizon's experience with shady privacy violations, notably anti-competitive behavior and PR distortion fields appears capable of turning the company's legacy telecom empire into a sexy new media brand. Still, it should prove entertaining to watch Verizon spend billions trying.

Filed Under: millennials, streaming, television
Companies: awesomenesstv, dreamworks, verizon

Access Hollywood: Detailing A Hollywood Mogul's Connections To The White House

from the modern-politics dept

There's been plenty of talk about how the Democratic Party is strongly supported by Hollywood -- and MPAA boss Chris Dodd famously threatened politicians that Hollywood might not fund their campaigns if they didn't support SOPA. So it's quite interesting to see Mother Jones' detailed analysis of Hollywood mogul Jeffrey Katzenberg's strong support of President Obama's last campaign. There's a lot of nuance in there, so this is not just a case of clear tit-for-tat political funding in exchange for political favors. The article states multiple times that Katzenberg doesn't really seem that focused on getting anything back for his efforts and money.

Katzenberg has said he wants nothing, personally or professionally, in exchange for his support of the president, and DreamWorks' DC agenda is hard to glean: The studio has no lobbyists and is not part of the Motion Picture Association of America (MPAA).

Later in the article, it notes that Chris Dodd asked Katzenberg to speak to Obama to find out his stance on SOPA in January of 2012, which was "mortifying" for Dodd, since Dreamworks is not a member of the MPAA. Katzenberg, who did support SOPA, still refused Dodd's request, but then did help to "soothe the egos" of other studio heads after Obama came out against SOPA, to make sure they kept funding him. As the article notes: "In the end, Katzenberg chose to help Obama win over his industry rather than helping his industry win over Obama."

Elsewhere:

Obama officials say they respect Katzenberg not only for his fundraising, but also because he has no specific "ask"—no ambassadorship to Switzerland, no regulatory tweak, no nights in the Lincoln Bedroom.

While that's good, the article does make clear two things: (1) even if he's not asking for anything specifically, he does have incredible clout, (2) the administration seems to want to keep wider Hollywood happy anyway, knowing that it will keep Katzenberg happy. In other words, even if Katzenberg's own motives are entirely pure, the possibility of policy pandering to him and his friends is high.

Obama takes Katzenberg's calls, and he and his political adviser, Andy Spahn, visited the White House almost 50 times between them during Obama's first term. (Not all of Spahn's visits had to do with Katzenberg.) It has also left him well positioned to advocate for his industry's and his company's interests in China's booming film market.

And, of course, lots of Democratic politicians now want to curry favor with Katzenberg and his friends, whether or not he asks for it.

Adds Paul Begala: "Every Democrat who has presidential ambitions is now going to beat a path straight for Jeffrey's door. Or they're too dumb to be president."

The end result, of course, are favorable deals even if they don't ask directly.

Yet it is hard to deny that he—along with Hollywood as a whole—has benefited from his connections. In the 2012 fiscal-cliff fight, for instance, the White House insisted Congress preserve a $430 million tax break for film studios that keep production jobs in the United States.

But, the much bigger deal, as the article explains, is how the administration, led by Joe Biden (of course), has helped clear the way for the Chinese market.

In July 2011, ahead of a trade visit to China, Vice President Joe Biden met with industry leaders who asked him to press their case. Biden, too, returned empty-handed. Seven months later, Xi Jinping, then China's leader-in-waiting, made his first official visit to America. On hand to greet him was Katzenberg, who scored a seat next to Xi at a State Department luncheon.

Later that week, Xi and Biden traveled to Los Angeles, and Katzenberg joined them for lunch with Gov. Brown. Biden spent the day pushing Xi on the film quota and profit sharing disputes. The White House wanted to bump the studios' portion from 13 percent to 27 percent, but as the negotiations intensified, Biden asked Katzenberg and Disney CEO Bob Iger what they could live with. Then Biden made Xi a new offer: 25 percent. Xi agreed, and he also said China would let in 14 more foreign-made 3-D and IMAX movies each year.

Katzenberg was simultaneously working on a $350 million deal to open Oriental DreamWorks, a new animation studio in Shanghai—and it couldn't happen without Xi's approval. That same day, at a US-China economic forum held at a downtown LA hotel, Katzenberg officially unveiled the project—and proudly announced that it now bore Xi's personal endorsement.

Having the VP of the US personally negotiate a huge deal like that for you is certainly a nice side benefit.

There's a lot more in the profile, which is really worth reading in full. It seems pretty clear that, unlike some who donate heavily, it really doesn't seem like Katzenberg is funding Obama because he wants something back directly, but rather because he believes in Obama himself. But what's most interesting to me is that, even if that's the case, the end results are almost still the same thing. Even without specific policy desires or asks, because of the money on the line, politicians (especially those vying for that money in the future) often feel they need to heed the general desires of the industry in order to keep that money flowing. That, alone, at least gives the appearance of corruption. Or, as Larry Lessig has called it repeatedly, "soft corruption." It's not the out and out bribery that many people think, but rather the overall set up that generally incentivizes behavior in the direction that favors the funders, even if it's at the expense of the public.

Of course, in the end what this comes down to, as always, is the issue of money and politics, and how it turns a democratic process into one in which those with more dollars have a lot more power and say. And that's still a big problem.

Filed Under: china, corruption, democrats, funding, hollywood, influence peddling, jeffrey katzenberg, lobbying, money in politics, politics, president obama, soft corruption, sopa
Companies: dreamworks, mpaa

Multiple Hollywood Studios Making Movies About Julian Assange; How Many Will Pay Him For His Story?

from the just-wondering... dept

We've all heard the refrain from the MPAA a million times: profiting off of someone else's work is "theft" and we need new laws to stop that kind of thing. So, it struck me as interesting to see an article in the Wall Street Journal, claiming that multiple Hollywood studios are planning movies about Julian Assange and Wikileaks:

Among the studios with WikiLeaks movies in development are Time Warner Inc.'s HBO Films, DreamWorks Studios, Comcast Corp.'s Universal Pictures and Annapurna Pictures, the company run by Megan Ellison, daughter of Oracle Chief Executive Larry Ellison.

Most of the article talks about the difficulty of creating a movie based on a true story that's still very much in progress. However, they just barely touch on the question of paying for the story. After all, the story of Assange is based on "his work," right? There had been one project that sought to buy an option on Assange's own memoirs, which were due to be published by Random House, but apparently Assange failed to deliver and the deal fell through. Other projects did option different versions of the Assange story -- but not from Assange himself. One optioned the book from former WikiLeaks spokesman, turned Wikileaks critic, Daniel Domscheit-Berg. Another optioned a profile of Assange that was done in the New Yorker.

However, all of the actual stories focus on Assange and his work in building up Wikileaks. If Hollywood really believes so strongly in not "profiting off the works of others" without fairly compensating them, why aren't they lining up to pay Assange?

Filed Under: daniel domscheit-berg, hollywood, julian assange, licensing
Companies: annapurna pictures, comcast, dreamworks, hbo, the new yorker, time warner, universal pictures, wikileaks

SEC Investigating Hollywood Studios For Alleged Bribes To China

from the open-markets dept

When the MPAA came out with its annual report about the movie market worldwide, it showed that China was a huge growth market. However, now it appears that perhaps some of that growth was the result of Hollywood studios bribing Chinese officials. For years, China has limited how many Western movies can be released in the country. While Hollywood loves to decry all of the "piracy" in China, much of it is due to the fact that the movies can't be released there under the law. That's a situation where the problem is not piracy, nor the MPAA itself (even as it whines about Chinese piracy), but local laws. However, there has been a loosening of those restrictions lately -- and the SEC is exploring whether or not that came about due to bribes from the studios:

The Securities and Exchange Commission has sent letters of inquiry to at least five movie studios in the past two months, including News Corp's 20th Century Fox, Disney, and DreamWorks Animation, a person familiar with the matter said.

The letters ask for information about potential inappropriate payments and how the companies dealt with certain government officials in China, said the person, who was not authorized to speak publicly about the letters.

That said, there is an interesting tidbit in the Reuters article about all of this, that really serves to highlight how ridiculous the MPAA's fight against "piracy" is. It shows that despite the fact that piracy is rampant for Hollywood movies -- once the MPAA was able to get legit movies into the country, people flocked to the theaters. In other words, despite the cheaper pirated options -- or even free options -- people have no problem paying for the legit product when it's offered in a quality fashion:

China's booming middle class is increasingly willing to pay tickets prices for a cinema experience, forgoing cheap pirated DVDs and free internet downloads.

Once again, this seems to demonstrate why the problem is not piracy. If consumers are offered what they want in a reasonable manner, they are more than willing to pay -- and the Hollywood studios seem to recognize this implicitly (which is why they may have bribed Chinese officials to release authorized versions in that market, even with "piracy" being so common).

Filed Under: bribes, china, hollywood, mpaa, sec
Companies: 20th century fox, disney, dreamworks, news corp

Judge Recognizes Separation Of Idea & Expression; Rules That Disturbia Didn't Infringe On Rear Window

from the nice-to-see dept

We've complained in the past that the so-called "idea/expression dichotomy" that's supposed to protect copyright law from violating the First Amendment seems to be getting so blurry as to barely exist in some arenas. Thankfully, it seems that some courts still understand this. A district court has rejected a copyright claim against Steven Spielberg and DreamWorks by the trust that owns the rights to the Cornell Woolrich story, Rear Window, which they claim Spielberg infringed with the movie Disturbia.

There's no doubt that there are some similarities between Disturbia and Rear Window (which was also, famously, made into a Hitchcock film in the 50s... with a license). It seems like pretty much every review of Disturbia pointed that out. But, there's a difference between being similar and being a copy. Even if it's based on the same idea, that doesn't mean it's copying any of the protectable expression from the original. And, that's what the judge found in this case:

"The main plots are similar only at a high, unprotectible level of generality," New York District Court judge Laura Taylor Swan wrote in her ruling that dismissed the complaint.

"Where 'Disturbia' is rife with sub-plots, the short story has none. The setting and mood of the short story are static and tense, whereas the setting and mood of 'Disturbia' are more dynamic and peppered with humor and teen romance," the judge added.

While this is appears to be a good ruling that understands these issues, it's still a bit troubling that this whole setup often turns judges into critics, concerning the level of similarities. Last year, of course, in a similar case, a court banned the publication of a book that was an unofficial sequel to Catcher in the Rye. It seems clear that such a situation also may have used similar ideas and plot points -- but did not copy the specific expression. Unfortunately, the judge-as-critic in that case decided otherwise, leading the US court system to ban a book (something that's not supposed to happen).

Filed Under: copyright, disturbia, expression, idea, rear window, steven spielberg
Companies: dreamworks

Will 'Paranormal Activity' Teach The Movie Industry A Lesson?

from the Blair-Witch-wannabes dept

I have to admit I don't usually like scary movies, and I didn't like the Blair Witch Project at all. But I can't help but be impressed that the Blair Witch movie cost just $60,000 and pulled in a cool $140 million back in 1999. That kind of return makes me wonder why more movies aren't filmed on really small budgets. So it's somewhat surprising to see that it took about a decade for another Blair Witch-like film to get promoted by a major studio... and that a perfect candidate was almost missed. The movie Paranormal Activity was apparently filmed for just $11,000 over 7 days, and it was bought by DreamWorks/Paramount -- which originally planned to shelve the low-budget flick and re-make it with bigger stars and a much higher budget.

Goodman also admitted that DreamWorks, formerly a leg of Paramount co-headed by Steven Spielberg, had swooped in and pocketed 'Paranormal Activity' with every intention of leaving it on the shelf and remaking it with a big budget and marquee stars. Then they wised up. 

They wised up indeed, and they also started promoting this movie in an interesting way, too -- by getting potential fans to demand it be shown in their neighborhoods and nationwide. Paramount promised to distribute the movie nationwide if a million requests for the movie were logged via Eventful. And it looks like they've already reached that goal.

As I said, I didn't like Blair Witch very much, and I'm not exactly looking forward to this movie, either. But from a pure business angle, it seems a bit shocking that movie studios wouldn't be trying to find/create more low-budget films that would appeal to moviegoers. Promoting the distribution of films in a way that actually target fans is a smart move, too. So with this example, there are about a million customers (or at least thousands, if you don't believe the Eventful numbers) willing to pay to see this movie that was made for (much) less than a $1 per fan -- and the movie studio's first gut-instinct was to try to re-make the film and drive their own costs up? It's a strange industry where insiders are always asking "how can we make a $200 million movie?" rather than how can they make good, but profitable movies, no matter what the cost. The industry seems so focused on what movies cost, that it so rarely seems to consider spending money more intelligently. Creating quality works for less, and targeting your best customers is a plan that's foreign to Hollywood, but perhaps it's about time they start exploring that plotline.

Filed Under: cheap, movies, paranormal activity
Companies: dreamworks, paramount

Spielberg Accused Of 'Stealing' Plot For A Movie?

from the you-can't-copyright-a-plot dept

Another day, another silly attempt to own an idea that will backfire badly. It would appear that the guy who owns the rights to a short story, It Had to Be Murder, which was the basis for the famous Alfred Hitchcock movie, Rear Window is now suing Steven Spielberg for copyright infringement, because Spielberg produced the movie Disturbia last year, that had similarities to Rear Window. This seems like a huge stretch, no matter how you look at it. While legal scholars may still be debating the question of whether or not you can copyright a "plot," for the most part, you cannot. The idea itself is not copyrightable, it's the expression of the idea. And while everyone involved with Disturbia admits that it was inspired by Rear Window, there's nothing illegal about being inspired by something -- otherwise, we'd have very little new content generated ever. Once again, this seems like someone who had nothing to do with someone else's creative work coming along and demanding payment.

Filed Under: alfred hitchcock, copyright, disturbia, movies, plots, rear window, steven spielberg
Companies: dreamworks

$150 Million Sure Can Inject Some Life Into A Pointless Standards Battle Over Next Generation DVDs

from the oh-that? dept

In what must be the world's most pointless standards battle over next generation DVD technology, apparently all it takes to reignite the tiny fire of interest is $150 million. If you hadn't been paying attention (and, honestly, why would you?), two separate groups have been battling it out over which technology will represent the next generation of DVDs: Blu-ray or HD DVD. Like many standards battles these days, the players believe the pot is so lucrative that they refuse to come up with a single standard -- despite the fact that competing standards basically guarantee that both sides lose. Fewer people are willing to adopt one technology if there's still a half decent chance the other one might prevail. At the same time, fewer people are willing to adopt one technology if half the content they want to view is stuck on the other technology. It's a lose-lose situation. While the HD DVD crowd would deny this, over the last few months, it had finally seemed like Blu-ray was edging ahead (for example, with thieves). However, HD DVD's backers have fought back from oblivion by giving Paramount and Dreamworks $150 million to only release movies on HD DVD, effectively ensuring that this remains a standards battle that no one cares about. The good news is that the longer this battle goes on, the more likely most folks will simply jump to alternatives that don't involve plastic discs.

Filed Under: blu-ray, dvds, hd-dvd
Companies: dreamworks, paramount