Courtesy of Michael Buckner for Variety
To say that 2020 requires a certain fortitude of the spirit, an ability to roll with the punches, is perhaps an understatement.
Amid the backdrop of the pandemic and the ongoing, years-long digestion of several mega-mergers, from Disney-Fox to ViacomCBS to AT&T’s WarnerMedia, pretty much every legacy entertainment house in town is in the process of maneuvering a massive ship-turning effort to better point their armadas in the direction of streaming.
This digital-first weltanschauung is itself unsurprising; that writing has been on the wall for years. But it has prompted realignments that are still trickling through corporate hierarchies as we approach the new year — as evidenced by the semi-monthly assortment of restructuring and layoff announcements — and slowly spelling out what it means to be a Hollywood executive in the new era.
With the Walt Disney Company’s latest reorganization of its television business under Disney TV entertainment chief Dana Walden, for instance, well-liked network boss Karey Burke is shifting gears and moving to the studio side of the business after two years at ABC Entertainment and several years overseeing original programming at youth-oriented sibling cabler Freeform. Going from head of ABC Entertainment to president of 20th Television might appear to be a lateral move, but in a land in which shows are not just shows, but precious content to be played for profit long past their scheduled weeknight time slots, overseeing production for a major chunk of the Mouse House’s prolific TV enterprise — now consolidated to two studios, not three — certainly seems like a desirable expansion of purview.
And perhaps being the head of a broadcast network isn’t what it used to be, as younger viewers increasingly regard linear TV as an anachronism. When NBC Entertainment chairman Paul Telegdy departed the network under a cloud of misconduct allegations and NBCU made overtures to Netflix’s Bela Bajaria, the former head of Universal Television, to oversee NBC and its cable sister networks, sources told Variety in August that she gently declined the offer. Just a month later, she would be elevated to head of global TV for Netflix, which boasts 195.2 million paying subscribers.
That’s not to say that the position at the top of a network has lost its appeal. With Burke’s transition, Hulu head of originals Craig Erwich is adding ABC to his programming duties, surely a welcome annexation of network territory for him. Elsewhere in recent history, longtime studio exec Susan Rovner, long seen as a successor to Warner Bros. Television Group chairman Peter Roth, jumped ship from Warner Bros. TV to lead NBCU’s TV and streaming entertainment content mere weeks before Roth announced he would step down in 2021. (Netflix’s Channing Dungey will replace him next year.)
Still, content remains king. Soon after Rovner’s programming announcement became official, NBCU upped Universal TV chief Pearlena Igbokwe to head of TV content as chairman of Universal Studio Group. Sources say Igbokwe was not considered a serious candidate for what is now Rovner’s perch in programming — not because she wasn’t also highly regarded, but because the studio’s mission is seen as critical to the company’s success. That Igbokwe reports directly to NBCU CEO Jeff Shell and not streaming chairman Mark Lazarus is but one indication.
Overseeing programming at a Big Four broadcast network is by no means insignificant, but as the aggressive drive to draw viewers to streaming services hits fever pitch, a linear network is in many ways just an earthly pit stop en route to an eternal streaming afterlife. And paying SVOD customers — 73.7 million in the case of Disney Plus’ first year on the market — is heaven. (A comparatively low-margin heaven, of course, versus the traditional revenue models for the TV business, but the new streaming era contains such necessary evils as price wars and straight-to-streaming enticements.) That has forged the path to industrywide streamlining of linear and digital platforms.
Disney Plus has proven that launching a viable streaming business — one that can compete with Netflix, or maybe more accurately, survive alongside it — is possible. As of October, sister streamer Hulu had about 36.6 million total paying subscribers, while ESPN Plus had 10.3 million. The trio’s major numbers meant that Disney’s overall direct-to-consumer and international segment revenue rose 41% to $4.9 billion during the fourth quarter as operating losses declined. The company doesn’t project Disney Plus hitting profitability until 2024, but with its subs reaching the internal target range of 60 million to 90 million well ahead of schedule, that day may come sooner than later — a crucial milestone in an environment in which Disney’s cash cow theme parks and box office hitmakers have been hobbled by COVID-19 closures.
With a focus on generating a profit during the streaming wars, another consequence of these leadership shakeups has been the divvying up of the creative and P&L sides of the business. Walt Disney’s initial reorg announcement in mid-October established that distribution and commercialization would be centralized under a separate group led by Kareem Daniel. Over at NBCU, Frances Berwick is heading business operations for its linear broadcast and cable channels, leaving Rovner free to dig into the creative programming decisions.
In that sense, perhaps both studio and network execs in this new age can be less burdened from managing budgets and more finely attuned to doing what they do best, i.e. producing and platforming good television. But a new hierarchy in town seems to be gelling, and that’s one in which studio folk — the engines responsible for stuffing the pipelines of broadcast, cable and, in particular, streaming — reign supreme.
Variety's Elaine Low contributed to this post.
https://variety.com/2020/tv/news/disney-reorganization-streaming-studio-network-execs-1234843750/
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