MGM, Spyglass & Lionsgate: A Classic Romantic Triangle
The Lioness has two suitors.
One has cash and relationships all over town with the most powerful players, but doesn’t really want a marriage. He is willing to be completely faithful… for a time… and both parties hope that they can fly high enough that if the romance ever ends, both will leave with more than they brought to the relationship.
The other is so anxious marry that he is willing to be less than financially equal to the Lioness. He’s financially stable, but has never really made the big bucks, as compared to the other guy. He’s already set up the structure of his life, so he doesn’t have to do much to add her to his life… two can live almost as cheaply as one. While most people seem to be focused on The Movies, he is whispering in her ear that the real potential is in Television… another embrace of stability over high-flying excitement.
But there is a interesting game being played by a quieter suitor of sorts. If Carl Icahn built his stake in MGM to 33%, as has been reported as his intention, and he maintains 30% or so of Lionsgate, he would end up with around 1/3 ownership of the new merged business with no other stockholder coming close to his level of ownership. It appears, based on the details released by Lionsgate this week, the indie studio’s leadership, ever at odds with Icahn, have agreed to cap production lower than recent efforts have indicated, which is one major thing that Icahn has been agitating over. Even if it’s not official, this deal happening would give Icahn more power in the combined company and allow LGF management a graceful way out the war they are currently having with him.
Lionsgate restraint would clearly be necessary to chase the dream if growing pre-tax cash flow to $731 million in 2016. That’s quite a projection… one for which I haven’t seen the details. How realistic? Sounds like a big bet. But who knows? Still, one chunk of the projection is not unique to Lionsgate… and that’s whatever they are projecting as revenues from Hobbit and Bond.
The Spyglass deal is pretty simple. The Lionsgate deal has hundreds of potential complications. Either way is a gamble of sorts. I see it as a philosophical choice. Lionsgate is more based on the dynamics of the MGM library and heritage and a lot of little pieces that MGM Creditors would, in reality, just have to trust Lionsgate to do right. Spyglass is more about bigger choices about movies and letting the machinery of Hollywood studios, as partners, do work for MGM/Spyglass that Lionsgate has never been able to achieve as an indie distributor. You could argue that Lionsgate offers the best of both worlds. You could argue that Spyglass’ track record is better, aiming higher, and that we really don’t know what MGM’s library will be in another 3 or 4 years. You could argue that the Netflix deal with Epix, which Lionsgate is party to, is a limitation… or you could argue that it’s the highest paying pay-TV deal in the market today and therefore cannot be replicated to Spyglass’ benefit… or you could argue that Netflix, as it did with Relativity, will do a similarly valuable deal with Spyglass/MGM. You could argue that a big franchise movie, like Bond, immediately raised Lionsgate to Major status… or that Sony or another current major could doa better job releasing the franchise’s next films… or you could argue that Lionsgate will have an incremental growth path that won’t handicap existing franchises, but will make growing new ones harder.
I can argue sides all day.
Either way, it’s going to be interesting.
At this point I don’t care as long as a new Craig Bond movie is put back on track as soon as possible…
But Lions Gate does seem to be the better suitor in this arrangement, they know how to exploit a large library of titles like what they did with the merger (takeover?) of Artisan, and this would give them the swing at the fences oppurtunities with Bond and Hobbit that they have been lacking at their current size. They could keep Lions Gate releasing the Screen Gems level fare it has become known for while moving its higher end pickups (precious, rabbit hole) under the MGM banner along with some tentpoles. Becoming MGM isn’t ideal but it beats being New World.
And given the critical success of Mad Men and Weeds, growth in television would be a great place to put your concentration. Sony rebuilt its television studio through making smaller series for fx and amc and now has a couple hits on networks, no reason Lionsgate can’t come up the same way.
That was my first thought too.
“So this means the next James Bond movie will be… when?”
Isn’t Craig too old for the role by now ?
they have to spend 6 months hyping up a new bond before
they even begin the story..
Bond never dies – so does it matter who plays him ?
Nic Cage perhaps ? let Dicarpio do it with Chris Nolan
as writer ..
Isn’t Craig younger than Bronson and Moore were before their first Bonds? And I would think quite a bit younger than Cage.
“Isn’t Craig too old for the role by now?”
No, basically. If he were, that would be remarkably stupid of the producers, who wanted him for three or four installments, which would have taken until 2013-2014 even without the delays caused by MGM’s financial woes.
For the sake of argument, let’s say Craig does another Bond film in 2011, at which point he’ll be 43 years old.
43 years old is:
* Older than the Bond actor was in 9 of the 20 non-Craig official Bond films.
* The same age as Timothy Dalton was for Licence To Kill.
* Younger than the Bond actor was in 10 of the 20 non-Craig official Bond films.
* (As an aside, this is also younger than Connery was in Never Say Never Again and Niven was in Casino Royale (1967).)
In other words, Craig is just on the younger side of the median. Obviously this is not “too old.”
The case is even stronger when you realize that 7 of the 9 Bond films where the Bond actor was younger were the FIRST seven. Thus, Craig is still younger than the Bond actor was in ALL BUT TWO of the Bond films dating back to 1973.
nic cage is younger than daniel craig?
nic cage?
Sam those sure are some nice stats but I think it comes down to how they look and not their true age.
And Sanj, what world do you live in when people age so dramatically in a year or so that they look completely different? The Logans Run world? Would people really watch a trailer and say “damn that new Bond film looks great but I hear he’s 3yrs older since the last one.. so no dice.”
It’s not like Craig is going up against Ernest Borgnine for roles. Too old? You damn crazy.