Following Disney, studio merges worldwide divisions
With its latest restructuring, Paramount becomes the latest major to seize on the growing international market and digital platforms, echoing Disney’s recent moves to merge its worldwide distribution divisions under the helm of a homevid vet.
Paramount’s newly created Home Media Distribution division, announced Tuesday, now unites homevideo, digital and TV licensing, under the oversight of former worldwide home entertainment president Dennis Maguire. At the same time, international chief Andrew Cripps has been asked to relocate to the Melrose lot.
Hollywood is swiftly moving to reorganize their home entertainment divisions, recognizing the financial benefits of having a single unit focus on how films are marketed and released after they’ve unspooled at the megaplex. And as the lines blur between physical and digital sales and rentals, bizzers are also realizing the advantages of having a single exec deal with everyone from Walmart to Netflix.
Lost in Paramount’s reshuffle is Thomas Lesinski, whose digital reign at Par is now over. With the shuttering of his Paramount Digital Entertainment group and its duties divided up among the rest of the studio’s divisions, Lesinski was left with little else to do but ankle a prexy post he’s held since 2006.
Lesinski had been in charge of how Par’s films were distributed across the Internet, on cellphones and through alternative platforms like videogame consoles and tablets. He also oversaw the company’s games biz, mostly through licenses with publishers. But now that digital is a larger piece of Par’s overall biz, studio toppers wanted each arm at the company to become more involved and not have a single unit on the lot do most of the heavy lifting.
As part of the reorg:
• Former co-presidents of domestic marketing Josh Greenstein and Megan Colligan are splitting their roles with expanded duties. Greenstein is now chief marketing officer, handling worldwide marketing campaigns for all platforms, including digital. Colligan serves as prexy of domestic marketing and distribution.
• Don Harris has also been upped to prexy of domestic theatrical distribution and will replace Jim Tharp, who will retire next June and will assist Moore in the transition. He had been with the company since leaving DreamWorks in 2006. Harris was exec VP of sales and will report to Colligan.
• Hal Richardson, formerly president of worldwide TV distribution, becomes president of home media distribution, under Maguire.
• The licensing of videogames will now be handled by LeeAnne Stables, exec VP of worldwide marketing partnerships, reporting to Colligan.
• The production of original Web content is now shepherded by Amy Powell, exec VP of interactive entertainment, who also reports to Colligan.
The realignment marks yet another strategic move by Paramount CEO-chairman Brad Grey to shore up the future of the studio. The moves occur a year after Par merged its licensing, promotions and consumer products divisions and a week after Grey unveiled a 25-year plan to upgrade the lot’s facilities. Par parent Viacom begins its fiscal year Oct. 1.
In addition to integrating its digital and homevid businesses, “Marketing and distribution have become seamless global businesses, and we need our structure to better reflect that evolution,” said Par vice chairman Rob Moore, to whom Maguire reports. “This new configuration allows us to be more flexible and to best capitalize on all opportunities across the breadth of the studio.”
Lesinski’s departure had been rumored for some time given the studio’s interest in consolidating operations. That was especially true as the studio started scrutinizing its bottom line more closely.
While PDE has been innovative since its formation in 2003, the digital dollars earned the division have yet to make up for losses stemming from the decline in DVD sales.
“We hoped that as DVDs declined that digital would make up for it, but digital distribution” hasn’t yet, and actually “created more piracy,” Lesinski said at the Tribeca Film Festival’s Industry Talks event in New York in April. He increasingly saw social media sites like Facebook (on which Lesinski made the “Jackass” franchise available to rent) “as destinations for video consumption. So wherever there is a large audience, such as Facebook, Hollywood will deliver movies.”
Still, until those dollars start adding up, Par has turned to Maguire to focus on wringing as much coin from packaged goods as possible.
Maguire’s resume includes 23 years at Buena Vista Home Entertainment, where he launched the Mouse House’s DVD biz. He headed up international operations of Par’s homevid unit since 2006 and took over as prexy of the group in 2009, after Kelly Avery left to rejoin DreamWorks Animation.
Whereas other studios fought with Redbox over day-and-date rentals with a DVD’s bow, Maguire said research found it didn’t cannibalize sales, making Par one of the few that didn’t force the kiosk operator to hold off on offering its pics for 28 days.
In fact, Redbox “was allowing us to expand our business and ultimately make more money,” Maguire said. Redbox is estimated to pay Paramount $575 million during the deal’s run through the end of 2014.
Lesinski had previously spent three years overseeing all of Par’s homevid efforts, as president of Paramount Worldwide Home Entertainment, which involved all of Viacom’s brands, including Paramount Pictures, Nickelodeon, MTV Networks, CBS and DreamWorks Animation’s toons. Before that, he spent a decade at Warner Bros. as an exec VP and general manger of home entertainment and exec VP of worldwide marketing for the group, where he grew the studio’s DVD biz.
But Lesinski wanted to shift his efforts over to the growing new-media landscape, an area he saw as a lucrative new moneymaker for the studio.
As head of PDE — the only separate digital distribution division at a studio when it launched — he got Par to release films on iTunes (when only Disney was doing so then) and made it the first studio to put a pic online, with “Jackass 2.5,” and pushed the studio to put its films on videogame consoles like Microsoft’s Xbox 360 and cellphones.
He also got the studio to invest in the production of original online properties, like “Section 8” and “The LXD,” and shepherded the studio’s games group, which consisted largely of licensing deals for consoles and mobile games.