You will be redirected back to your article in seconds

The Role of Today’s Studio Chief Has Been Redefined

Jeff Shell’s rise at Universal shows that knowledge of complex distribution strategies is a must for the top job

Comcast Corp.’s naming of Jeff Shell as head of Universal’s movie studio may have taken many by surprise last week, given his lack of experience and profile in Hollywood’s notoriously insular film industry.

But when viewed as a reflection of (or window into) where the business is today and where it may be headed, his appointment shouldn’t come as a shock.

Today’s corporate owners of the major studios are all struggling to define a more profitable strategy in an age where digital distribution, the growing significance of the international marketplace and other key factors are toppling age-old business models, and demanding new ways of thinking.

Such industrywide tumult has no doubt led to an extraordinary amount of management change atop four of the major studios in the past year.

Media congloms like cable giant Comcast are increasingly turning to leaders with a new constellation of business skills, who can anticipate, navigate and respond quickly and boldly to the seismic changes under way in the creation, consumption and multiplatform delivery of movies in theaters, at home and on hand-held devices.

Shell, a respected Comcast executive with extensive experience in international TV and cable programming, is the latest example of what a studio chief in the 21st Century looks like.

Earlier this year, Time Warner tapped Kevin Tsujihara to lead its Warner Bros. studio, where for years he oversaw home entertainment and digital initiatives. Likewise, when News Corp. pushed out 20th Century Fox’s movie co-chairman Tom Rothman, a veteran steeped in the content-creation side of the business, it bet on his more multifaceted partner Jim Gianopulos, a forward-looking executive schooled in the international marketplace and keen on new media and antipiracy efforts, to guide the studio into an ever-changing future.

Walt Disney Co. honcho Bob Iger, the former head of ABC, who is not known for having a passion for movies, nonetheless has made strategic acquisitions of market leaders such as Pixar Animation, Marvel and “Star Wars” producer Lucasfilm to ensure a more reliable revenue stream coming from the Burbank studio.

Comcast, the first of Universal Studios’ previous four owners to install one of its own executives at the top, opted to kick aside movie chairman Adam Fogelson in favor of someone who it believes can best manage the asset by looking out at the industry from 30,000 feet.

“You have to really understand thebusinesses that studios are in,” says Fred Bernstein, an attorney with Katten Muchin Rosenman who ran Columbia Pictures from 1994 to 1997. “It’s not just about making hit movies anymore … the pure producer/production executives have become the anomaly because their perspective and skill set is deemed too narrow.”

Of course producing hit movies is still imperative, which is why if these new business-centric studio bosses are to succeed, they must stay closely aligned with their creative counterparts, whose jobs are focused on wrangling the best talent and material they can muster while assembling their yearly film slates.

“Creative origination is now more of a group process,” says Matthew Harrigan, a media analyst at Wunderlich Securities. “Studio heads are now experts on tech road maps and feeding benefits to other divisions rather than gut greenlighting of projects.”

Veteran entertainment attorney Ken Ziffren, who estimates that movie business margins are 17% at best, agreed, noting that the future health of the film industry “will depend on how studios can anticipate and maneuver new technologies.”

As was the case with U’s Fogelson, even strong box office results can’t necessarily save someone’s job. The studio had a good year, bolstered by such blockbusters as “Despicable Me 2” and “Fast & Furious 6.” And, Hollywood at large witnessed a record summer, with ticket sales of $4.75 billion — and it’s on track to break another record at year-end if the momentum keeps up.

But such positive news masks underlying fault lines in the business, which recently saw hundreds of millions of dollars lost on such costly flops as Universal’s “R.I.P.D.” and “Battleship,” Disney’s
“The Lone Ranger” and Sony’s “After Earth,” among several others.

Production costs have skyrocketed as the majors increasingly bet on bigger, more expensive tentpoles that frequently cost upwards of $200 million to make. As the costs to market and distribute these movies worldwide also have continued to balloon, the international box office has become crucial to a studio’s bottom line.

“What this industry needs right now,” says Jean-Luc de Fanti, managing partner at studio co-financier Hemisphere Media Capital, “is more fiscal discipline, more cost controls, because the business is challenged.”

Veteran movie producer Jordan Kerner says that the huge losses Hollywood has been incurring from box office misses has driven the price of failure to steeper-than-ever levels.

“When there’s failure, there’s big failure,” Kerner says. “It doesn’t leave room for executives to have failures anymore.”

That means studio chiefs must now be more globally focused, with an idea of how their content can make money beyond the theatrical window. “To say the business has gone global is the understatement of the year,” says former Sony Pictures chief Peter Guber, head of Mandalay Entertainment Group. “It requires the executives to be more ambidextrous. It’s not just, ‘How does it play in New York and (on) Hollywood Boulevard?,’ which was the ’80s. (Now it’s) how does a product move through various platforms in different areas of the world?”

Warner Bros.’ new partnership with “Harry Potter” author J.K. Rowling — of which Tsujihara was the architect — exemplifies the kind of cross-platform mindset that today’s studio chiefs need to survive. Warners announced last week that it planned to develop a new film series to woo entertainment-buying muggles to “all areas” of WB’s wizardry business, including theme parks, digital initiatives and games.

In July, Comcast played a significant role in bringing Thomas Tull’s Legendary Entertainment to NBCUniversal, a deal that allows the comicbook-focused production company to use the studio’s theme parks and television operations to promote its movie content.

The new generation of studio chiefs, it appears, must also be willing to experiment with the complicated delivery of that content as traditional release windows between the time a movie is seen in theaters and the time it is available on other platforms, including cable and video-on-demand, continue to collapse.

In 2011, the studios, desperate for a new windowing strategy, decided to release a few films earlier on VOD, beginning with Universal’s “Tower Heist” starring Ben Stiller and Eddie Murphy. When its planned experiment sent exhibitors into an apoplectic frenzy, a squeamish Universal quickly backed down from the proposal. Some might argue that Shell would not have shied away from pulling that trigger.

Simply put, as the industry continues to shift underneath their feet, executives need a gutsier way of thinking.

“There used to be a world where if you just stayed within Hollywood and you played the game well and really developed relationships with filmmakers and understood how to identify and make good movies, that was enough,” Bernstein says. “But it’s not enough anymore.”

The New Chief Executive Suite

Jim Gianopulos, Fox

Prior to his current role as head of News Corp.’s movie studio, Fox Filmed Entertainment chairman Gianopulos ran the international division. The tech-savvy executive also took an active role in Hollywood’s antipiracy efforts and its relationship with Silicon Valley.

Jeff Shell, U

As chairman of Universal Filmed Entertainment Group, Shell brings a deep knowledge of the international market to his new job, having led NBCUniversal’s overseas operations from London for the past 2½ years. Known as a skillful negotiator, he’s also in sync with Comcast’s focus on driving new distribution models.

Kevin Tsujihara, WB

During his 19-year tenure at the studio, Tsujihara, now Warner Bros. CEO, oversaw homevideo, digitial distribution, videogames and emerging technologies. Under his leadership, Warners has explored innovative ways to deliver content across various digital platforms.

More Biz

  • Discovery CEO David Zaslav Sees 2018

    Discovery CEO David Zaslav Sees 2018 Compensation Soar to $129.4 Million

    Discovery Inc. president-CEO David Zaslav is once again making headlines for an enormous compensation package. Zaslav’s 2018 compensation soared to $129.44 million in 2018, fueled by stock options and grants awarded as the longtime Discovery chief signed a new employment contract last July that takes him through 2023 at the cable programming group. Zaslav received [...]

  • Jonathan Lamy RIAA

    Jonathan Lamy Stepping Down From RIAA

    Jonathan Lamy, the Recording Industry Association of America’s longtime executive VP of communications and marketing, is stepping down from his post after 17 years, he announced today. As he put it in an email to Variety, “I started back in 2002, which means it’s been 17+ years, four different RIAA CEOs, three format changes and [...]

  • Fox Layoffs

    Disney-21st Fox Layoffs: TV Divisions Brace for Deep Cuts

    A second day of layoffs has begun on the Fox lot in the wake of Disney completing its acquisition of 21st Century Fox on Wednesday. Longtime 20th Century Fox Television Distribution president Mark Kaner is among the senior executives who were formally notified with severance details on Friday morning. 21st Century Fox’s international TV sales [...]

  • anthony pellicano

    Hollywood Fixer Anthony Pellicano Released From Federal Prison

    Anthony Pellicano, the Hollywood private eye whose wiretapping case riveted the industry a decade ago, was released from a federal prison on Friday, a prison spokeswoman confirmed. Pellicano was sentenced in 2008 to 15 years, following his conviction on 78 charges of wiretapping, racketeering, conspiracy and wire fraud. He had been in custody since 2003, [...]

  • This image taken from the Twitter

    HBO’s Reaction to Trump’s ‘Game of Thrones’ Campaign

    Everyone wants a piece of the “Game of Thrones” lemon cake. From Bud Light to Red Bull the world of Westeros is open to a lot of brand partnerships, unless you’re using that iconic typeface to push a political agenda. In November of 2018 President Donald Trump unveiled a “Thrones” inspired poster with the words [...]

  • Leaving Neverland HBO

    'Leaving Neverland' Lawsuit Proves to Be a Judicial Hot Potato

    The Michael Jackson estate sued HBO last month for airing the documentary “Leaving Neverland,” which accuses the late King of Pop of serial child sexual abuse. Since then, the case has had a difficult time finding a judge to handle it. Three federal judges have recused themselves in the last week, citing potential financial conflicts [...]

  • Members of the public mourn at

    Guy Oseary’s New Zealand Fundraiser Nears $150,000, Continues Raising Money

    In the wake of the horrific shootings at New Zealand mosques last week that killed some 49 people, Maverick chief Guy Oseary launched a GoFundMe campaign to “support those affected by this tragedy at this very difficult time,” and began it with an $18,000 donation. Boosted by donations from many celebrities — including Amy Schumer, [...]

More From Our Brands

Access exclusive content