AT&T have reported significant subscriber growth for HBO Max in one of their last acts for the now officially spun-off Warner Media streaming platform this week. Entertainment lawyer at Blake & Wang P.A, Brandon Blake, has the news for us.

Last Report

As mentioned, this will be the last time we hear from AT&T regarding what once was WarnerMedia, as the long-anticipated merger with Discovery to form the brand new entity Warner Bros Discovery, has recently completed. Their Q2 earnings report will come to us from the new entity, of course.

What will be intriguing to many, however, is whether this might also be the last time we hear from HBO Max as a single entity. With the merger bringing both Discovery + and HBO Max into the fold, it has been announced that the two will merge, but no timeline has yet been given.

Three Million New Subscribers

HBO and HBO Max have a combined streaming subscription total of 76.8M as at the end of Q1 2022, a rise of 3M from the previous quarter. It’s also a 12.8M year-on-year increase. AT&T have always given us the ARPU, or average revenue per user, for domestic subscribers too. Here we see a 9c increase to $11.24 for the quarter.

It’s hard not to position this modest, but appreciable, growth against the news that Netflix suffered its first subscriber loss in over a decade in the same quarter. Coupled with a disappointing earnings report, this has seen its stock plunge, losing over a third of value and tanking $50B from its market cap last Wednesday. The highly obvious factors of increased competitors and pandemic recovery were blamed.

Things certainly seem to be looking up for the streamer, which has been fairly insignificant compared to competitors to date. Where to from here? It will be interesting to see if the promised merger with Discovery+ lives up to the market hype as the ‘next Disney+’ after all.

In news that’s not entirely unexpected after critical panning, we’ve seen a softer Box Office than anticipated for both Morbius and Fantastic Beasts: The Secrets of Dumbledore. Brandon Blake, entertainment lawyer and our industry insider from Blake & Wang P.A, takes a look at the figures.

Morbius Nosedives

Sadly, Morbius currently holds a record no superhero movie needs- one of the sharpest drop-offs from opening weekend we’ve seen in a long while. Dipping 74% lower than last weekend, it pulled in a meager $10.2M after its strong debut, bringing its ten-day total to $57.7M. This ‘outperforms’ even notorious Box Office dropouts like Batman v Superman, Hulk, and Fantastic Four. Only long-forgotten 1997 superhero offering, Steel, which dropped from an $800K-ish debut to a tiny $191K in weekend two, managed worse. 

So no, sadly. The somewhat buoyant idea that this movie would perform better with audiences than critics, propped up by a decent opening weekend, hasn’t panned out either. It’s hard not to see this one as a bust. The notion that every Spider Man villain needs their own spin-off movie, or that it can perform on Venom levels, is hopefully put to bed for good. 

Fantastic Beasts: The Secrets of Dumbledore Starts Soft Overseas

The newest in the Fantastic Beasts franchise has had a soft international start, too, though still managing $58M. Some of it can be written off to COVID closures in China, though a lot is also market boredom with once-loved franchises there, too. However, while Japanese markets performed equivalent to the previous franchise installment, takings were halved from the UK, too. Even the ever-nostalgic Millennials seem to finally be tiring of the same old wizardly battles.

Not that it was bad news for the Box Office overall. Despite these two flunking out of the class, we saw commendable enough performances from The Batman and The Lost City, which was expected to have sunk into obscurity by now. Add a decent showing from Sonic 2, a solid performance from Uncharted, and the still-present loom of Spider-Man: No Way Home to Sing 2’s continued strong presence and an oddly strong showing from R-rated zombie romp, X, and the news wasn’t bad for the Box Office overall. It might just be time to put a cap on the superhero farming until a worthy target presents itself.

With a sky-high opening weekend for Sonic the Hedgehog 2, are we finally seeing some signs that theatrical audiences will diversify into other markets than eager superhero fans? Family-friendly fare has long been a coveted box office property, and one needed for the wider Box Office recovery. Blake & Wang P.A entertainment lawyer, Brandon Blake, looks at the facts. 

Strong Performer

Sonic was always going to be an attractive property to test the family market with. It’s a well-liked IP in general, and its predecessor shattered standing ‘video game movie’ records. It’s also pulled in decent reviews, including an A from Cinemascore. 

With a budget of only $110M, Sonic the Hedgehog 2  has already managed to tear down some records of its own, bringing in $71M already over its first Friday to Sunday weekend. It’s also one of very few child-centric properties to hit cinemas in recent months, with Disney opting to shuffle most of its Pixar releases directly to streaming. Its next significant challenger will be Lightyear, set to release in June. 

The First $200M Video Game Movie?

All of which gives it a solid chance of becoming the first video game movie to topple $200M. Why, however? Sonic 2 highlights a lack of the standard ‘IP exploitation, CGI characters, and Easter Eggs’ model video game spin-offs have followed previously. Instead, we see a decent child-aimed movie with less pandering to their nostalgic parents than we’ve seen before. Instead, it’s a solid attempt to be a stand-alone movie without disregarding the source material entirely. 

Of course, this is no grand cinematic masterpiece. But it is very good at being exactly what it needs to be to have life and vibrancy of its own. And it’s one of the first ‘new’ IP franchises for Paramount to truly be successful on its own merits. For a studio that was fast running out of gas in 2016, it’s a refreshing sight. 

Paramount, in fact, may be an odd little success of the post-pandemic landscape. With Sonic 2 buoying their bottom line, and a surprisingly successful revival for their Scream and Jackass IPs, as well as the original comedy The Lost City in the bag, they’ve managed to recreate themselves some relevancy few expected. That Sonic 2 also stands a great chance of pulling another key demographic- families- back to the cinema is a nice cherry on the top.

Upfronts are a changing landscape, with how we consume TV and film shifting rapidly throughout the industry. Now we see Sony Pictures Television team up with their sister-studio, the Game Show Network, for another industry first. Blake & Wang P.A entertainment lawyer, Brandon Blake, has the insider information.

A Shifting Landscape

We’ve already explored how live-event TV and game shows remain two of the most popular Linear TV offerings, with scripted and unscripted programming mostly retreating to the streaming space. This new announcement seems to reinforce that perspective. Both entities will be placing a renewed focus on how live viewing and ‘TV games’ allow for brand integration and buoyant viewer numbers despite the challenges offered by streaming popularity. 

This means we will see long-time genre staples like Jeopardy up in lights alongside new programming like the Sony marquee property The Good Doctor, entering off-network syndication from September this year. 

Active Linear TV

The entirety of the Game Show Network remains a high-penetration linear channel despite a growing digital presence, so it makes sense for Sony to leverage that for greater attention during Upfronts. It reports production growth of 32% over the 2020 benchmarks, bringing 350 hours of original programming to the table. Alongside Jeopardy; People Puzzler, a spin-off from People magazine’s notorious crossword puzzles, America Says, Master Minds and Chain Reaction all remain immensely popular properties. They also have newer trivia-based programming in the works to tease.

Sony itself is, of course, the home of Wheel of Fortune, King of Queens, S.W.A.T, and the ever-popular reruns of Seinfeld.

The stated aims of the partnership include fostering consistency and confidence in the networks for advertisers and viewers alike, and boosting their profiles as ‘reliable and trusted environments’ for advertisers to connect with consumers. 

It’s the first, but no doubt not the last, time we’ve seen a major industry player leverage their popular linear content to reassure and interest advertisers, so it will be interesting to see how advertisers respond to the change.

What if ‘winning’ the streaming game doesn’t lie in creating the largest channel, but in dominating how people consume streaming services? This is a question we could see Roku answer in the coming years. Entertainment lawyer Brandon Blake examines their stranglehold on the smart TV market.

A Risky Gamble

Roku entered the wider streaming market seven years ago, when digital distribution of entertainment content was still in its relative infancy. Instead of gambling only on their own channel, they instead provided an operating system that sought to tie together people’s existing hardware with the shift to digital through their set top boxes. Today, most people buy their products fully integrated on smart TVs, although they still have set top boxes on offer. 

Last year, they sold more smart TVs to U.S families than any competitor. As of the end of 2021, they have a 38% share domestically, and 31% share in Canada. They claim 51.2M active accounts, 14M of which came online in the last year. Roughly 58.7B hours of entertainment was watched through Roku devices in 2020.

Not bad for a brand that was unknown at launch.

Monopolizing the TV Space

Most of this was created through offering affordable smart TV sets, backward-compatible tech, and an easy-to-use UI instead of the latest, greatest features. This at a time when the American public were still only dabbling in the intimidating new streaming spaces and reluctant to spend much. It is still primarily their smart TV UI that drives the company bottom line, with other tech reaching only middling sales stats.

It’s certainly given them power in the streaming landscape despite owning no studio or content creation point of their own. Of course, they haven’t been bulletproof, as we saw in their messy negotiations with AT&T over HBO Max last year. However, they have an undeniable traction in the market, even getting away with some ad-sharing and revenue demands no other third-party host has managed to date. They have also been fairly successful in demanding that parts of their partners’ catalogs go to their (free) Roku Channel.

It’s an interesting side development in the streaming space, and one they continue to dominate. Could winning the streaming wars lie in not fighting them at all, but simply leveraging others? Blake & Wang P.A will certainly be interested to see how Roku develops over the next few years, as streaming becomes the dominant film and TV market player. 

In an interesting move, we have seen the U.S. Federal Communications Commission (FCC) announce that it will introduce new requirements to force broadcasters to disclose foreign governmental interests on domestic airwaves. Brandon Blake, the entertainment lawyer at Blake & Wang P.A, breaks down what we know.

April 2021 Ruling

While it’s tempting to see the development as tied to wider political developments, it has in fact been afoot since April last year, simply rolling out now. Going forward, the new rules apply immediately to newer leasing agreements, and will need to be adopted within a half-year period for existing agreements. 

It will be a requirement that it is disclosed at the time of broadcast if a foreign government entity paid for the material to air, on both TV and radio. Direct, as well as indirect, airwave leasing is included. 

Greater Transparency

The stated aim is to introduce greater transparency to how, and when, foreign government-sponsored material is being broadcast. We’ve seen an overall upward wing in such programming of late, with Chinese and Russian material leading the charge. This is likely to be why the roll-out is being pressed into effect so abruptly. Growing concerns over the spreading of news via social media and digital platforms likely also played a role in the change.

While the wider political ramifications are not ours to contemplate, the move towards greater transparency in consumed programming, and the interests behind it, is likely to be met with general positivity. As the content boom brings us more and more ways to consume media, not always intended for simple enjoyment, it could represent a step in controlling the messages reaching our eyes. How well met it will be by the general public, however, remains to be seen.

Will The Batman meet current predictions to become (at least) Hollywood’s fifth-biggest pandemic-era film? As the film crosses the $300M mark globally, it’s looking well set to do so. Brandon Blake of Blake & Wang P.A. looks at the numbers for us.

Critical and Fan Performance

The Batman was always going to face a lot of scrutiny, representing the first superhero film and the first real blockbuster to follow in the wake of the runaway success of Spider-Man: No Way Home. To date, the Matt Reeves take on the Caped Crusader has held up well under both the critical gaze and fan opinion. This has been something of a surprise for many. The casting of Robert Pattinson, in particular, in the lead role faced something of a fan-driven kickback at first, even netting a petition to boot him from the role when the casting was first announced. Best known as the sparkly lead from Twilight, many fans felt he couldn’t possibly live up to expectations as the dark and broody superhero.

On the contrary, he’s managed to turn in a compelling performance that’s resonated well theatrically and with critics. While we saw a very slight drop-off in takings for the Tuesday following its opening weekend, it has still managed to keep overall takings buoyant, and the drop-off is reasonably comparable to that for many other films released at this time of year historically. It’s also perfectly reasonable to assume much of the focus will be on weekend showings as the world gets back to work.

Predicted Path

Crossing the $300M threshold brings it into direct competition with COVID-era key players like Tenet, Free Guy, Black Widow, F9, Dune, and even No Time to Die and Shang-Chi and the Legend of the 10 Rings. While there’s a long way to go before it could rival the exceptional performance of Spider-Man: No Way Home, a benchmark it likely won’t meet, that’s impressive enough at this time. There’s a realistic chance that, by the time you read this, it will actually crest the $400M mark, too. 

With certain Asian markets only seeing their opening weekend this week, it’s an admirable performance, and one that still has reasonable room for growth still. This entertainment attorney will be watching its future performance with great interest.

Squid Game has already rewritten key parts of TV history for itself, being one of the first non-English language drama series to ever carve itself an iconic spot in Western TV history. Now we’ve seen it get the nod from the SAG awards with three wins. Entertainment lawyer Blake & Wang PA’s Brandon Blake has more. 

The Most Popular Series in Netflix History

The series needed no award accolades, of course, to be a notable entry in the history books. It’s already blasted its way to the all-time top series list for Netflix, and has netted more than one key accolade in the process. It even made history with its SAG nominations, being the first non-English series to be nominated for any award at all. 

Yet winning 75% of the SAG awards it was nominated for is an impressive feat in itself. We saw  Lee Jung-jae win Outstanding Performance by A Male Actor In A Drama Series, Jung Ho-yeon win the award for Outstanding Performance by A Female Actor In A Drama Series and the ensemble cast took home the award for Outstanding Action Performance by Stunt Ensemble in a Television Series. It lost out on the Outstanding Performance By An Ensemble In A Drama Series, with Succession taking the title. It’s a sweet win for Jung Ho-yeon, particularly, marking her debut in the acting world from her model career.

Not The First Win

This isn’t the first win for Squid Game this season- cast member Oh-young-su previously won a Best Supporting Actor Award at the 79th Golden Globes, the first Korean actor to take home a Golden Globe ever. Squid Game itself won a Gotham Award for Breakthrough Series, a Bingeworthy Show of the Year award at the People’s Choice Awards, and an AFI Special Award, too.

However, it’s the first time we’ve really seen it get stuck into the traditional awards format, picking out specific performances as well as the ensemble cast’s efforts rather than simply honoring the series for its iconic takeover of our screens. All in all, it’s a very happy win and one that was deserved. This entertainment lawyer wishes them all the best on their wins.

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While South Korea is a key example of how much global traction local-language productions can actually pull, it’s not the only arena for streaming focus right now. Netflix has been investing in local originals across a far wider base- and now it’s added France to the list at last. Brandon Blake of Blake & Wang P.A shares the news.

French Cinema Guild Deal

The new deal will see a $45M investment in at least 10 French and European films over the three-year period, all of which will have guaranteed theatrical release in France. Reached with the three key French guilds- ARP, BLIC, and BLOC, representing producers, creatives, and cinema owners- it’s the first SVOD deal of its kind to be seen in the country. Netflix will return at least 4% of its annual net revenue into the productions, and $34M of the deal will focus on French-language productions. 15 months after the theater release, Netflix will acquire an exclusive 7-month streaming window.

Low Budget Prioritized

17% of the $45M deal must also be plowed into productions with a sub $4.54M budget. The deals will be pre-financed, so before principal photography, too. This comes on the heels of a deal to invest 20% of the streamer’s annual revenue in France into French content, something mandated by the French government to put it onto an equal footing with other TV networks in the country.

They have, however, received special dispensation on the window between the local release and online screening. France has the longest window, at 36 months, of any European country, but Netflix will only be required to adhere to the 15 month window above. 

Despite this development paving the way for Netflix to return to Cannes, an arena it has been locked out of due to the requirements for the competition titles to have a French theatrical release, it seems they will not be returning to Cannes this year. Perhaps, however, we will see a 2023 release for them? It’s too early to tell, but this entertainment attorney will be watching with interest.
            

Roku announced solid subscriber growth, but unmet revenue targets, for the close of Q4 2021. Brandon Blake, Blake & Wang P.A entertainment lawyer and industry expert, unpacks the figures and fills us in on some key news and developments. 

Below Wall Street Expectations

While Roku managed to onboard subscribers to take it to 60.1M active users in the last quarter of the year, its total revenue of $865.3M fell short of Wall Street Benchmarks. This has been mostly attributed to supply chain issues delaying new purchases in the US TV market. While this is expected to also adversely impact Q1 for this year, total revenue for the upcoming Quarter is currently estimated as $720M.  However, there were other positive growth indicators, too. Streaming hours grew by a modest $1.5B, and the CEO seemed very happy with overall results despite the Wall Street naysayers.

A New Smart TV?

What Louden couldn’t be drawn on, however, was whether there’s any traction in rumors that Roku will be looking to create its own TVs. We do know, however, that Roku’s platform chief, Scott Rosenberg, will be exiting the company as of spring. He will be replaced by former NBC direct-to-consumer president, Gidon Katz. Oddly, however, Rosenberg insists this isn’t a direct placement, describing his role as ‘monetizing’ the platform and the new role more about user experience, visual design, and experience creation. It’s an odd line to draw in the sand, really. 

All the same, while Wall Street may be grumbling about their expected benchmarks, Roku’s managed to onboard a fair chunk of subscribers at a time where that’s no longer easy to do. And, distribution chain challenges aside, it’s turned a decent profit doing so, too. We will be watching Q1 results with great interest.