July 3, 2026 • 40 mins
John Ellis talks with Richard Rushfield, founder of The Ankler, about a Hollywood business model under stress. Rushfield traces the industry’s troubles back to the end of fin-syn rules, the rise of Netflix, and a wave of consolidation that has left studios bigger, safer, and more risk-averse. They discuss Disney’s parks-first future, Paramount’s high-stakes tie-up with Warner Bros. Discovery, Fox’s Roku bet, YouTube’s dominance, AI anxiety, China’s fading promise, and why horror still works while comedy has nearly disappeared. It’s a tour through Hollywood’s money, politics, technology, and creative exhaustion.
Hosted by John Ellis
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SPEAKER_01 (00:00):
Hello and welcome back to the News Items Podcast.
I'm John Ellis.
I'm the editor-founder of newsitems, also of political news
items.
You can find them both atnews-items.com.
Our guest today is RichardRushfield.
He's the founder of The Anklerand widely regarded as one of
the most influential independentvoices covering Hollywood.
(00:23):
His widely read commentary onthe industry's power bases and
business, both good and bad,have earned him a devoted
following across Hollywood, whatVanity Fair described as a
quote, bold-faced subscriberlist.
Over a two-decade career, Mr.
Rushfield has been acontributing editor at Vanity
(00:44):
Fair, where he authored thelong-running intelligence report
and has written and edited foroutlets too many to name.
He previously served aseditor-in-chief of Hitfix and is
the author of three books.
He was also the first author topublish on Substack out of Los
Angeles starting in 2018.
So you're one of the originalson the Substack menu, so to
(01:07):
speak.
And you make a very persuasivecase that that is sort of the
(01:28):
origin of Hollywood's what youmight call woes.
So can you sort of walk usthrough that column?
I thought it was just a terrificpiece.
SPEAKER_00 (01:38):
And by the way, thank you for for news items,
which I was a very early adopterof, I believe, and has been a
invaluable part of my my it'sthe way I start every morning
and uh I love it.
But uh Thank you.
So thank you for doing it.
So FinCEN, which I which as asit's referred to, I talked about
what so what you had from the uhin the late sixties, early
(02:00):
seventies, the FCC imposed theserules to sort of break up the
strength of the three majornetworks, which uh seemed to
have near near monopoly power atthat time.
And what they mandated was thatnetworks could not could only be
the distributors, uh, and theycouldn't they would not own the
shows that they produced.
(02:20):
What immediately came out ofthat is you had this flourishing
of these independent producersand this and and what became a a
very competitive space of theseproducers making all kinds of
shows, and what the the 1970s isthought of as a golden age of
television immediately came outof that and and led to
eventually the cable networksthat came because you had so
(02:43):
many people doing so manydifferent things rather than uh
just these three networks.
So entertainment in general doesnot work very well when it is a
sort of command and controlsystem.
Entertainment is sort of basedon having happy surprises, and
you need to have them at veryregular intervals for it to
survive.
(03:03):
And once you fall into a patternof doing the same thing, you
your audience starts to driftaway almost instantly, and that
that is drifting film.
You had thanks to theseindependent producers, you had a
very vital world in Hollywoodthat led to that that led also
to filmmakers.
One one thing uh a very wise CEOonce explained to me as as it as
(03:26):
it became in the the 90s, thethat movies get an outs get get
probably 90% of the attentionout there.
But as he explained to me backthen, the the business of
Hollywood, the business of themovie studios is a cable TV
business, essentially.
And he's and his codicle to thatwas even movies are a cable TV
business.
(03:47):
And every everything flowed outof out of the the cable bundle
and the cable revenues.
And when that met with thisecosystem of independent
producers, it produced a reallyrich and vital and growing
world.
In the 1990s, they were theydecided to end those those rules
because they thought that thatthey they wanted to make it open
(04:08):
to to these new upstart internetproviders.
And then uh I think beforeNetflix came along, even, but
the idea that this ecosystem hadbecome too powerful, and now
we're gonna open up to to newpeople.
What the effect of this was tocreate a a world where when the
networks could own their owntheir own their own shelf, as it
(04:32):
were, that that it would revertback to what what happened
before, which was sort ofconsolidation and a few just a
few players having the uh thewherewithal to support these
vast production budgets, exceptthat now it was on a huger scale
because it it would come toinclude the streaming networks
and everything else.
And what what we've seen, sorry,I'm glossing over a lot of a lot
(04:55):
of stuff in a complicated issue,but what we've seen since then
is this consolidation whereeverything is coming together in
it once again, and it was it wasthree networks back in the uh
back in the 1960s, and we'relooking to essentially be three
major streaming services thatthat will fund most of
(05:16):
entertainment.
And those will at the moment, ifif they continue, those would be
those would be Netflix, Disney,and some sort of Warner
Paramount combination if the uhif if that continues with with
other minor players in therealso.
So it is this consolidation ledby Vincent, which has led to a
really strangled world here, andboth creatively and economically
(05:41):
depriving people ofopportunities and outlets and
leaving Hollywood vulnerable tocompetition from uh from the
internet and from ininternational and and uh just
changing the nature of thisbusiness.
SPEAKER_01 (05:53):
I remember talking to Rupert Murdoch about why he
chose to sell the entertainmentassets of Fox to Disney, and his
reply was, do you know how manyfeature films we make in a year?
And I said, Well, I don't know,20, 25.
He said it's 14 to 16.
He said, Do you know how manyfeature-length films Netflix
(06:15):
makes in a year?
And I said, I don't know, 20,25.
And he said, 40.
And so truthfully, we can nolonger compete.
SPEAKER_00 (06:27):
At the time that that they sold it, Netflix had
come out of nowhere and theirproduction budget for film, I th
I believe was as much as everyother studio combined for a
while.
So it was it it it was likenothing Hollywood had had ever
seen.
And they also brought with themthis new business model that uh
you know, on on on the one hand,you you you say uh Netflix is
(06:49):
doing its own business, let themlet other companies try uh try
different things and and and andthat would be for the for the
best for Hollywood.
The corrosive effect thatNetflix has is really how other
companies influenced or imitatedthem and more than more than how
they didn't know.
So the the model that that thatthey brought in is they
(07:09):
eliminated the idea of thatproducers and and participants
in a in a production and own apiece of it and the back end.
They said, we will pay enormousamounts like no one had ever
seen, and we'll buy out the backend as it's called.
We'll have 100% ownership inperpetuity on on all these
productions.
That is a a practice that hasbeen increasingly uh imitated
(07:33):
elsewhere, and that is that ispart of the consolidation and
the the the fincen problem thatyou no longer have these
independent groups who can makea living off it.
And also from a consumerperspective, independent
producers were there to ensurethe quality.
That you you had someone incharge of the quality.
You had you had people reallyinvested in the success of every
(07:55):
production, and you had peoplewho had a big outcome in trying
new things and doing and takingchances and taking risks that
you know a few a few majorplayers, Netflix and Disney
being at the top, those, aren'tincentivized to do in that way.
SPEAKER_01 (08:09):
One of the big themes of your writing is the
diminishment of risk, thateverything essentially is
risk-averse.
Has that just becomedramatically more evident in the
course of your career writingabout Hollywood?
SPEAKER_00 (08:25):
Uh certainly.
It started first with film, andit actually came sort of pr pre
um internet.
It be it came from this uh thisidea, the sort of big IP idea
led by uh Robert Eigert ofDisney.
That the problem with withmaking a film is that you make a
new movie and you're puttingtogether an entire business from
(08:46):
scratch, and you don't know whothe consumers are, you don't
know if there will be anyconsumers.
You've got to teach the audienceand the world what this new
thing is and have to get them tocome to movie theaters within
this three-day window, thisexact three-day window
essentially, to make to make ita success.
And under Iger at Disney, theythey they they took over Pixar
(09:08):
and Marvel and Luke Some.
They had these ideas that youcould have a strategy that was
entirely sort of sequels and andand remakes and these universes,
as they call as they came tocall it with uh with Marvel, and
that you could essentially getout of the idea of having to
make risky original things.
And that was enormouslysuccessful for them for about 10
(09:32):
years.
There was a year when I thinkDisney alone, this one studio,
accounted for more than half ofthe box office.
I think that was in 2019.
And every other studio did it.
The problem, of course, iseventually you've got to
introduce new things, especiallyin entertainment where novelty
is the entire, it's it's notjust a feature.
It's like I mean, you can keepselling Quake Roats oatmeal or
(09:55):
uh or or bathroom tissue thesame and make little tweaks on
it forever.
But but if movies lookessentially the same now as they
did 10 years before, you'regonna your audience is gonna go
running.
So that was that that that wasthe problem with that.
And that that so movies lost hisoriginality and it kind of
migrated over to streaming,where they went from 200 shows
(10:18):
to 700 shows they were making,which gave them room to take all
kinds of chances, all kinds ofrisks, and do all sorts of crazy
things.
Now the streaming world isbecause of consolidation,
because the boom is seemingbusting because basically Disney
and and Netflix have maxed outon subscribers and are now
looking to maintain.
They have become morerisk-averse too, and are going
(10:40):
to much safer things.
So it's a problem across thebusiness.
SPEAKER_01 (10:45):
Is there a reason that Disney can't find a chief
executive other than Bob?
SPEAKER_00 (10:50):
Well, they they they they've they've got one now,
Josh Josh DeMarrow.
Uh I mean, what they made clearin his appointment is that
Disney is essentially a parksbusiness, and that the theme
parks are the the engine of thewhole thing, and that everything
else is just uh feeding intothat.
They paired him with uhessentially with Dana Walden,
(11:11):
who will be in charge of thegraded thing, and hopefully she
can keep creating new charactersand new stories that essentially
become rides and cruise shipsdown the line.
The interesting thing aboutbeing a becoming a studio CEO is
that it takes so long to makemovies that when you come in for
about three years, you're justyou're you're just living off
(11:31):
whatever your predecessor did,and you get all the credit in
blank.
Like Toy Story this weekend ToyStory was an enormous hit, the
biggest hit at opening of theyear.
So that will all be seen as toJosh DeMarrow's credit, but you
know, that was a that was amovie that was put into work
probably five, seven years agoof a series that started before
(11:52):
Bob Iger, under what MichaelIser was CEO, but it will all be
Josh DeMarrow's uh credit there.
SPEAKER_01 (11:59):
It's interesting that films are really about to,
you know, or the point is tocreate a uh ride at an amusement
park.
SPEAKER_00 (12:08):
I mean that when you look at the the the amount of
money those parks those parks uhchurn out and uh the parks and
they have cruise ships also now,and it's it I mean the amount of
revenue that drives to the wholethe whole system is
incomparable.
SPEAKER_01 (12:21):
So we have to talk about Paramount, because that's
all anybody is talking about.
Give us your take on Paramount,Warner Brothers Discovery
tie-up, I guess.
SPEAKER_00 (12:32):
Well, it's uh it's it's another front in the uh in
the FinCon war here and them andand consolidation and bringing
everything together under oneroof, which uh for a lot of us
uh think augers bad things forthe industry.
It's interesting because if ifit had been Netflix had won the
war, it would have been a moresort of lean conversation about
(12:53):
consolidation and those effectsuh because it's paramount and
because of the Ellison familyand their closeness with Trump
and and and their willingness uhto send all sorts of happy
signals to this administrationas it reviews this project, it
it's it's also become apolitical dispute.
But uh you know, I uh I wouldsay t tempers are rising on it.
(13:16):
It will be I I believe thelargest uh LBO in in US history,
you'd probably know that betterthan me.
But uh, I think it is, yeah.
But uh the and the question isthat it the estimates is that
will leave them in about eightybillion dollars of debt.
So it if it's going to be thisnew giant studio to compete with
Netflix, but they're sitting oneighty billion dollars of debt,
you know, the the film divisionin a good year might have turned
(13:38):
out might have brought in twobillion dollars of uh gross
receipts.
Uh how they make a dent in thatin in that in that number is a
big question, and they haven'treally told us much about that,
and they haven't told so is thisjust going to be you know, the
the fear is that thisconsolidation will lead to just
a huge streamlining and them andthen them selling off parts and
(14:02):
the combined company being muchdiminished.
You know, the the the answeragainst that is well the
Ellisons have a lot of money andthey can do whatever they want.
And surely they didn't buy thiscompany just to strip it down,
which I I've I've floated someconspiratorial thinking that
maybe this is all aboutsomething else, all about
something bigger in the Ellisonworld.
(14:22):
But that those are those arethose are the many fronts here.
SPEAKER_01 (14:25):
Can can you uh tell us what the conspiracy theories
are?
SPEAKER_00 (14:29):
I I just I look at I look at this and say, I don't
see the the path to this being aprofitable business.
I I I don't and I don't I don'tsee why Larry Ellison would go
down this road.
And I also see that they arewhatever what they are very
loudly attempting to telegraphto the administration their
their loyalty and support forhim in and in in the moves that
(14:51):
that that they're making here,which makes me wonder is there
some sort of bigger Oraclebenefit that this is basically a
a marketing tool for uh forthat.
And that that gets into a worldbeyond my knowledge.
I'd well they give healthcare toOracle or something, or all all
the all the government's cloudaccounts to Oracle or something
(15:14):
that makes the uh you know, inthe end, I think they'll put in
personally 40, 50 billion thatmakes that 40 or 50 billion
insignificant.
SPEAKER_01 (15:23):
So I I wonder, because I do believe it has been
approved now, the deal has beenapproved by the FCC.
SPEAKER_00 (15:31):
It has, yeah, and the and and the Justice Barn
very which which apparentlypreempted its own lawyers'
review to approve it.
Uh now we await apparently thethe state's attorney generals
are are going to file suit.
Uh we don't know how many statesRob Bonta, California's attorney
general, has been leading thatand sort of dropping hints that
(15:52):
other states will be involved.
Uh and has said he we we don'tknow how many other states will
be involved, and we don't knowwhat court it will go through
and what their reaction to itwill be.
Um I'm I'm told the co the thecourt can pause it or the court
can let go through while whilethis suit works his way through.
And you also have the Europeans.
(16:12):
Uh I it's the the I think a lotof a lot of this a lot of the
transaction uh taking effectdepends on European approval of
it also.
And uh and they they they aredue to uh I think they're due to
weigh in any day now and uh saywhether they're gonna hold it
up.
So we're waiting for all that.
SPEAKER_01 (16:32):
So speaking of streaming, which we were uh Fox
just acquired Roku fortwenty-two billion dollars.
Explain to us why that's a smartmove or a bad move on Fox's.
SPEAKER_00 (16:44):
You call it FAST, uh the the the fast channels, the
ad support free ad supportedservices, which were which I've
now come down to essentiallyRoku and and Tubi.
And Fox also owns Tubi.
It's it's kind of the leastglamorous part of the industry,
so it it doesn't get a lot ofattention, uh, but it it takes
(17:05):
up uh when you when you look athow much of the the eyeball time
being spent by by by viewersthere between between those two
channels and what they'rewatching.
I mean, YouTube just dwarfseverything.
So it's a it's a huge sector ofof entertainment.
And Fox is making a a big moveinto it.
Again, the least glamorous partof entertainment, so it doesn't
(17:28):
get nearly the ink, it doesn'tget you know a millionth the ink
that say a little independentmovie does, but it's it's a
hugely consequential piece ofpiece of the business.
SPEAKER_01 (17:39):
Can anybody possibly compete with YouTube?
It seems to me that YouTube is,you know, the central station of
media outlets these days.
SPEAKER_00 (17:49):
Apart from TikTok, it's hard to see who really can
get into that business.
Uh YouTube but you YouTube stillhas really declined to get to to
jump into original production,and that's what leaves you know
this opening for everything elsein Hollywood, because they they
they still are happy to just tohave influencers and micro
(18:12):
things.
The influencers can't can't funda twenty million dollar an
episode production bill.
So that's not gonna happen thereunless unless the company
supports it.
And you know, if the companydecided, well, we're we're gonna
fund a ten billion dollarproduction budget tomorrow, they
could they they could say we canfund a hundred billion dollar
(18:33):
production budget tomorrow withcash on hand, probably.
But that that that you know thatthat that is that sort of thing
that Amazon or or or Apple orYouTube would get into that in a
serious way is the thing thatkeeps even Netflix awake at
night.
The idea that they could thatthey would decide that they are
(18:54):
going to just own this uh thethe this sector, but they're
clining to to go that far thatdeep into it is what allows the
others to come to to survive,essentially.
SPEAKER_01 (19:05):
Aaron Powell One thing that's changed uh
dramatically since you've beenuh writing, even for the anchor
since you've been writing aboutuh Hollywood and the media
business more generally, is thearrival of AI and the the
unbelievably uh inexpensiveability to to make you know
eventually, I guess, feature lefeature-length films just using
(19:28):
the AI tools that uh DeepMindand and Chat GPT, etc.
uh provide.
What do you think the impact ofAI is now and what do you think
the impact is going to be onHollywood's business and on on
the creative side of theHollywood business?
SPEAKER_00 (19:44):
It's become almost a moral panic at this point where
where directors as they theylaunch their film are terrified
that of the questions they'regonna get about how much AI did
use.
And you know, if a productionassistant sent a sent sent a
text to the director saying,What do you want in your coffee?
and and it that that was spellchecked by the by by the phone,
(20:06):
then that film used AItechnically.
So it's it's very hard for amovie to say we didn't use AI,
but it but they every directoris being demanded, did you use
AI on this film?
And the ones that did are uhhave this sort of scarlet letter
over them because AI is seen asa thing that will swallow
creativity and the industry andtake all the jobs away.
(20:29):
I think the reality we we j wedon't know how it's going to
play out, but the idea this is acompetitive market for for
filmmaking.
There was a a one that was verynoted at Sundance where it was a
probably a five million dollarbudget on that film, but it
looked like a$50 million film.
It was very uh it looked like avery polished, accomplished film
(20:52):
in a way that an independentfilm usually couldn't have.
And a lot of people suspectedthere was a lot of AI tools that
went into making that.
But so on the one hand, you cansay, and it's probably true,
that will take the jobs awayfrom a lot of people.
On the other hand, for studios,if if they can have five million
dollars that look like$50million movies, they're probably
(21:12):
gonna green light a lot more ofthose movies and put a lot more
of those movies into production.
And at the upper end of thatscope, where you have movies
with$200 million budgets, theywant to save, they they do want
to save money, but they're alsocompeting against other other
movies.
So if if you have a$200 millionbudget and say AI lets you take
$50 million off that budget,then that's great for your
(21:36):
budget there.
But you have another moviecoming out that was a$200
million budget that will thatwill take those uh those
improvements and build on them,and that will be a$200 million
movie that will now look like a$1 billion movie, and you'll be
competing against that.
So the idea that you just pocketthese savings and lay people off
and do everything much smalleris not how Hollywood produced.
(22:00):
traditionally works.
But there's undoubtedly vastareas where we're we're where
people can can do it.
But in the end, I thinktechnology in Hollywood
generally becomes a tool in thehands of of uh of creative
people.
And and and that's that's that'swhere this will end up.
SPEAKER_01 (22:18):
Amazon owns uh MGM studios.
So they're actively in uh thefilm business.
They also have enormouscapability on the AI side of
things, as well as obviouslyAmazon Web Services.
So it it would seem like theywould be an enormous threat to
Netflix because, you know, oftheir wherewithal, of their now
(22:41):
standing in Hollywood, etcetera.
Are there contracts, are therelabor contracts that prevent
them from doing as much as theymight with AI?
SPEAKER_00 (22:50):
Aaron Ross Powell To some extent they're they're
working here, but it's the Imean there are there are things
like you you you can't just takeBrad Pitt's image and create a
and create a synthetic Brad Pittwithout Brad Pitt's involvement
and and and and not pay him forthat.
But I mean someone will make anentirely AI generated movie
someone will press a button anda movie will pop out and someone
(23:13):
will distribute that somewhereand we'll see how that does.
My guess is is not very good.
I spoke to just talked to uhChris Melanandry who who's uh
the the uh the head ofIllumination studios and uh the
new movie Minions is going to bea big big hit here and he he
talks about the word uh the thethe idea of incongruity that
(23:35):
incongruity is what really fuelsentertainment and incongruity is
what the things that you wouldnever think of that to fit
together and the things that nocomputer algorithm could tell
you that go together.
But the these sort the themistakes the happy accidents and
the little things are what drivecreative development and and uh
(23:57):
you know I when when people dothe whole AI generated movie I'd
just say I'm you know myattitude is let let them do it
and and and let's see how thatworks out for them.
I don't I I don't think it'sgonna go very well.
On the other hand of it on theother hand using AI to improve
effects and all that well usingcomputer generated tools to do
that has been going on for 30years.
(24:19):
That's that's a that that's aprocess.
And it has led to lots of cutsin lots of ways and and and that
is unfortunate.
But before AI there weren't lesspeople working in uh in the Zen
they they were being exportedand they explored and they were
doing it abroad and it was nolonger a centralized system but
the people were using thesetools and building on them
(24:40):
rather than just pocketing thethe savings.
SPEAKER_01 (24:44):
One of the themes I guess of of news items is the
rise of China and China has inthe past anyway been a major
consumer of U.S.
uh film industry product orwhatever you want to call it and
and that seems to have changedthat seems to have diminished.
Is that is that true?
(25:05):
Has it diminished?
Is the the market closing downor what what's going on with the
U.S.
SPEAKER_00 (25:11):
film industry and China you know we we haven't
gotten a clear sense of that andit it it doesn't it it seems
like a bit less so but you stillhave some films that are
performing well uh there therehasn't been one clear message of
of where it was Hollywood alwayshas like the thing that's gonna
that's going to save it.
And the it you know we we sortof lurch from one disaster to
(25:33):
like oh here's a the big thing.
And most recently with livesports was the thing that was
gonna that was going to saveHollywood.
But the one before that wasChina.
China was the thing that wasgoing to save Hollywood.
It's no longer be looked at thatway like like that that this
huge Chinese market can come inand save us.
But I I think with individualfilms it still makes makes a
(25:55):
difference.
So that really uh sets them tothe side for for the the the
major business going on here.
But still an open question.
SPEAKER_01 (26:06):
Another thing that's always talked about is the rise
of TikTok and Instagram and youknow attention span being what
it is that the most anybody canhandle is a one minute snippet
on TikTok or Instagram.
How real is that how real isthat uh narrative I guess?
Is is TikTok, are TikTok andYouTube and Instagram making it
(26:32):
more difficult for the studiosto reach a larger audience?
SPEAKER_00 (26:36):
I mean when you look at just sort of eyeball time
those things dwarf anything thatHollywood does.
It's it's it's it it's vastlybetter.
But you know that a TikTok videocan't get people to get a
babysitter and come take theirfamilies to to spend$100 at the
movie theater.
It can't it it it can't getpeople to it in general to pay a
(27:00):
$20 monthly subscription fee forservices.
It can't and it can't it it'snot where sort of premium
advertisers are looking to to toto place their their their
advertisements.
So it's not it for sheer eyeballtime it's it's competitive but
it's not it it it in many waysit's just not in the same
(27:21):
business as as we are.
And in the end that you know weall hit up hit the problem of
there's only 24 hours in a dayand seven days in a week and and
that can only be divided so manyways but you when you when you
look at when you look at the thethe successive choice story this
weekend the I YouTube has beenaround for a long time and I and
(27:42):
the appetite for for featurefilms certainly the appetite for
produced TV shows has notdiminished at all.
So it's it's it's still there.
The the more interesting thingyou you've seen this year you've
had a couple of these horrorfilms that have come out of the
YouTube world obsession andbackrooms become massive hits
and it it spawned a lot of talkabout how YouTube will be an
(28:06):
incubator for the new talentthat will will come out and that
that will probably be the thenext thing that will save that
that is going to save Hollywoodand we'll we'll see how that
works out.
SPEAKER_01 (28:17):
So I can I'm I'm a scaredy cat so I can't watch
horror movies as I I get thatgets worse as I get older I I I
found but but but what is thedeal with horror movies?
They seem to come out I w I wentto the movies we went to see uh
what's his name Ryan Goslingmovie uh Hail Mary which was
(28:37):
fantastic and you know becauseuh the actual AMC theater needs
to you know make as much moneyas possible I guess there are
about ten trailers that go onbefore the movie so if you get a
330 movie actually doesn't starttill like four but you know at
least five of them are horrormovies.
So the what's the audience forthat?
SPEAKER_00 (28:58):
I mean horror movies have been the most consistent
genre of Hollywood since thevery since the dawn of Hollywood
and it's the one genre thatnever really goes away that sort
of reinvents itself every decadewith with a new version all
through the 90s where there areall these independent films
going on horror was still strongwith the the the scream series
that other genres kind of comeand go but horror is always is
(29:22):
always there and it's it'salways appealed to young people
going to the movies together andthis is this is this is a big
big thing that Hollywood istrying to work for how do you
get young people to the moviesand Holly and horror is always
skewed very young.
It's always been kind of acommunal sort of thrill ride for
the for for for for people to goto and I I I think it's kind of
(29:45):
it's it's always been prominentbut it's it be kind of become
more prominent as other genreshave receded so it it it it it
seemed bigger and and Hollywoodalso become and Howard also
because it's very it'srelatively very cheap to make
compared to say a Marvel film,it it allows for a lot more
experimentation, a lot more kindof new voices to be part of it.
SPEAKER_01 (30:09):
One of the things that surprised me during the
pandemic given how grim it wasthat Hollywood produced it
seemed to me virtually nocomedies to sort of relieve
people's angst about what washappening with the pandemic.
Was that surprising to you?
Or was it just that the pandemichit it takes a year and a half
(30:30):
to make a comedy and by then youknow they would think well the
pandemic's going to be over sowhy do that?
SPEAKER_00 (30:35):
What h whatever happened to comedy, I guess is
the answer I mean there this isthis is this has been the
subject this will be the subjectof PhD thesis because comedy has
drama and comedy or comedy andtragedy are the perennial the
perennial spectrum and it's it'ssort of and it it's really
disappeared.
You just you just had in thelast few years the studio is
(30:58):
barely making things that arepure comedies.
I think they're releasingsomething like five of them this
year.
It's almost disappeared fromfrom from the menu here and I I
think there's a lot of thingsthat have happened um the the
the one one that preceded theinternet is is the perennial
problem that pseudo people pointto is that comedies don't
(31:20):
travel.
Every country's idea of comedyis very unique and idiosyncratic
and comedies have not in generalplayed as well overseas as as
other kinds of films.
So that that that's always beensomething against them.
You had the kind of wokebacklash to a lot of different
(31:40):
comedians that sort of madevarious kinds of edgy comedy and
sort that that sort of came upas there was a a style of comedy
exemplified by the hangover thatwas kind of seen as sort of frat
boyish all the more so it kindof squashed that and it it led
to the idea that people don'tfeel safe to laugh at things
together in the world.
(32:01):
So and whether that is true ornot a lot of studio executives
definitely believed believe thatand believe that making sort of
edgy comedy and R-rated comedywas was was a dangerous thing
that that that got them introuble.
So the the dominant form offilmmaking in the last 20 years
has been the action comedy whichis kind of comedy so if you look
(32:24):
at Marvel films it they all kindof fit into action comedy so
it's kind of swallowed up a lotof the comedy demand from that
and then you had you had thestreaming world kept uh Netflix
in particular made a lot ofcomedies and made people think
well maybe come maybe maybestreaming is the place for these
things now.
So you had a lot of differentvoices I think there's there's
(32:45):
more things coming into thesystem there's when I a lot of
this kind of starts andpercolates up from the the
independent world and atSundance last time was there
were a lot of comedies thatbroke out of there.
So you just you need one or twoof those things to really break
through in the way that thesehorror films broke through and
and and Hollywood wakes up toit.
(33:06):
But it's it's uh it's a bigproblem.
SPEAKER_01 (33:08):
So do you go to these things?
SPEAKER_00 (33:10):
Do you go to the Sundance Film Festival and the
Tridecca Film Festival and theCannes Film Festival or do you
just stay in LA and the the thedeal I've negotiated with my
family allows me three festivalsa year which are Sundance and
then the Toronto Film Festivalin the fall which was where a
lot of sort of the Oscar filmdebut and it's kind of a good
(33:32):
one to go to it's kind of thefestival of festivals is how
they refer to it where they theybring films that have done well
at other festivals there.
And then I go to a Cinemacon inLos which isn't a a festival as
much as the gathering of the ofof the theater owners in America
they do that in Las Vegas inApril every year where the
studios present their plates.
So those are my permitted uhexcursions every year.
SPEAKER_01 (33:55):
Aaron Ross Powell I left working for Mr.
Murdoch in 2019 early 2019.
And my goal in life has alwaysbeen to report to no one and
have no one report to me.
So I achieved this by going onSubstack and starting news items
although I do have a couple ofpeople who help on the on the
product but you started in 2018was was it the same thing you
(34:18):
you desired to not report toanybody and have no one report
to you and then it got sosuccessful it became a real
business?
SPEAKER_00 (34:25):
That was what I was uh thinking.
I just that uh having I I'dspent the past decade and a half
kind of working more as aneditor than a writer on various
uh websites or failing mediacompanies trying to trying to
start a web venture and I Idecided I I didn't want to deal
with the problems of otheremployees.
I didn't want to deal with theproblems of uh of of other
(34:46):
companies I just wanted to dealwith my own problems for a
while.
So I started that and then thebut one thing that happened was
happening when I started doingthat when you started doing this
the marketplace for newsletterswas was very uh open and I'm I
mean it wasn't I was the best atdoing what I was doing.
I was the only person doing anewsletter like this uh for
(35:06):
Hollywood at the time.
So you had a lot of feel but itwas becoming increasingly more
crowded and I was seeing this isgoing to become harder for one
person alone to to sustain andbuild something and I and Janice
Minn who is a legendary editorwithin within within Hollywood
in the trade world approached meabout the idea of building
(35:26):
something bigger around it.
So I I really have the best ofall worlds now and that I can
that that she's built this uhthe this this big operation
around me and I get to just uhfocus on all my own problems and
issues and everything.
SPEAKER_01 (35:40):
So when you did the deal with Janice was that you
you presumably obviously came toan agreement with her okay let's
take this thing bigger and didyou go out and raise money to
make it bigger or how did theyraised a very small amount of
money.
SPEAKER_00 (35:54):
We we we we went into we actually the Substack
folks suggested just that wejoined Y Combinator and and
introduced us to them.
So we actually did a a YCombinator training program and
the the or their their or theiruh boot camp there and they
really persuaded us like you'reyou're a profitable business
already why why do why do youwant to raise money?
(36:16):
What uh what what do you so wewe raised a a really small
amount of money and we haven'traised money since then uh we've
we've gone we've we've lived offour revenue we've been
profitable the whole time andand grown on our revenue which
you know at this point stillowning the full business and and
having all the assets gives us alot of choices so the the Anchor
(36:37):
is at theankler.com and I'veI've started a new little side
project on my own kind ofprivate substack uh called the
Rushfield Jamboree which is kindof my my sandbox where I'm gonna
start doing a daily interviewshow and other other sorts of
things on there which is part ofAnchormedia but is uh my own
(36:58):
little playground.
SPEAKER_01 (37:00):
So theanchler does you you go there tell tell our
audience because I think a lotof people are really interested
in in what's happening inHollywood but I think people are
always interested in what'shappening in Hollywood.
SPEAKER_00 (37:13):
What what are the verticals as they say what are
your verticals that we're we'relooking at uh kind of the the
the the places that the tradesand traditional media don't
cover we have a report on on whojust covers the uh influencer
sphere like and subscribe wehave we have we have we have a a
morning newsletter sort ofsimilar to what you do but for
(37:33):
for for the entertainment worldspecifically called the uh the
wake up uh Sean McCulty sort ofbreaks down the numbers we have
uh the few people focused onreally just the TV business the
business side of of the TVbusiness we have people we we
have another one called prestigejunkies that uh that focuses on
the awards races and the Oscarfilms and and kind of the the
(37:57):
high-end films there we have awe have an AI column we have uh
Eric Wehrmark uh AI professionalhas a that does a a weekly
newsletter just about AI so wehave a lot of a lot of different
things there.
And how much does Hollywood hateyou?
Hollywood hates who it'sconvenient for Hollywood to
hate.
So it's uh they they wouldprefer the they would always
(38:20):
prefer that no one have anyopinions about about about their
work all the time.
They're probably not alone inthat in the world but but you
know I I would say many of myclosest sources and uh and best
advisors they they come aboutthey they we we start because
they call me to yell at mesomething I write that really
incense them and then we havelunch and we're we're best
(38:41):
friends after that.
So it's uh when when it when itserves their interests to hate
me they will they they will theywill hate me very very
vociferously it's the classicthing where they call you up,
they berate you and then thenext day they say hey I've got a
great story for that you can'tthink about whether they like
you or hate you because thosearen't really operative are they
(39:03):
paying attention or are theyreading you is what you what you
got all you can think about.
SPEAKER_01 (39:07):
Aaron Ross Powell Any more books coming from you
or uh or you're otherwise toobusy?
SPEAKER_00 (39:12):
I've got a a a book about Hollywood in the 90s that
I will write when I retire.
This uh doing doing two c I dotwo columns a week and a daily
interview show and then one biginterview a week and and and
various events and other thingsso sadly there's not much not
much time for book book writingbut someday retirement will come
and uh and my fourth book willwill follow.
SPEAKER_01 (39:35):
All right Richard well we take in more than enough
of your time to thank you verymuch for doing this we
appreciate it and uh we'll talkto you next time thanks so much
for having me and thank youagain for all you do there.
Hello and welcome back to the News Items Podcast.
I'm John Ellis.
I'm the editor-founder of newsitems, also of political news
items.
You can find them both atnews-items.com.
Our guest today is RichardRushfield.
He's the founder of The Anklerand widely regarded as one of
the most influential independentvoices covering Hollywood.
(00:23):
His widely read commentary onthe industry's power bases and
business, both good and bad,have earned him a devoted
following across Hollywood, whatVanity Fair described as a
quote, bold-faced subscriberlist.
Over a two-decade career, Mr.
Rushfield has been acontributing editor at Vanity
(00:44):
Fair, where he authored thelong-running intelligence report
and has written and edited foroutlets too many to name.
He previously served aseditor-in-chief of Hitfix and is
the author of three books.
He was also the first author topublish on Substack out of Los
Angeles starting in 2018.
So you're one of the originalson the Substack menu, so to
(01:07):
speak.
And you make a very persuasivecase that that is sort of the
(01:28):
origin of Hollywood's what youmight call woes.
So can you sort of walk usthrough that column?
I thought it was just a terrificpiece.
SPEAKER_00 (01:38):
And by the way, thank you for for news items,
which I was a very early adopterof, I believe, and has been a
invaluable part of my my it'sthe way I start every morning
and uh I love it.
But uh Thank you.
So thank you for doing it.
So FinCEN, which I which as asit's referred to, I talked about
what so what you had from the uhin the late sixties, early
(02:00):
seventies, the FCC imposed theserules to sort of break up the
strength of the three majornetworks, which uh seemed to
have near near monopoly power atthat time.
And what they mandated was thatnetworks could not could only be
the distributors, uh, and theycouldn't they would not own the
shows that they produced.
(02:20):
What immediately came out ofthat is you had this flourishing
of these independent producersand this and and what became a a
very competitive space of theseproducers making all kinds of
shows, and what the the 1970s isthought of as a golden age of
television immediately came outof that and and led to
eventually the cable networksthat came because you had so
(02:43):
many people doing so manydifferent things rather than uh
just these three networks.
So entertainment in general doesnot work very well when it is a
sort of command and controlsystem.
Entertainment is sort of basedon having happy surprises, and
you need to have them at veryregular intervals for it to
survive.
(03:03):
And once you fall into a patternof doing the same thing, you
your audience starts to driftaway almost instantly, and that
that is drifting film.
You had thanks to theseindependent producers, you had a
very vital world in Hollywoodthat led to that that led also
to filmmakers.
One one thing uh a very wise CEOonce explained to me as as it as
(03:26):
it became in the the 90s, thethat movies get an outs get get
probably 90% of the attentionout there.
But as he explained to me backthen, the the business of
Hollywood, the business of themovie studios is a cable TV
business, essentially.
And he's and his codicle to thatwas even movies are a cable TV
business.
(03:47):
And every everything flowed outof out of the the cable bundle
and the cable revenues.
And when that met with thisecosystem of independent
producers, it produced a reallyrich and vital and growing
world.
In the 1990s, they were theydecided to end those those rules
because they thought that thatthey they wanted to make it open
(04:08):
to to these new upstart internetproviders.
And then uh I think beforeNetflix came along, even, but
the idea that this ecosystem hadbecome too powerful, and now
we're gonna open up to to newpeople.
What the effect of this was tocreate a a world where when the
networks could own their owntheir own their own shelf, as it
(04:32):
were, that that it would revertback to what what happened
before, which was sort ofconsolidation and a few just a
few players having the uh thewherewithal to support these
vast production budgets, exceptthat now it was on a huger scale
because it it would come toinclude the streaming networks
and everything else.
And what what we've seen, sorry,I'm glossing over a lot of a lot
(04:55):
of stuff in a complicated issue,but what we've seen since then
is this consolidation whereeverything is coming together in
it once again, and it was it wasthree networks back in the uh
back in the 1960s, and we'relooking to essentially be three
major streaming services thatthat will fund most of
(05:16):
entertainment.
And those will at the moment, ifif they continue, those would be
those would be Netflix, Disney,and some sort of Warner
Paramount combination if the uhif if that continues with with
other minor players in therealso.
So it is this consolidation ledby Vincent, which has led to a
really strangled world here, andboth creatively and economically
(05:41):
depriving people ofopportunities and outlets and
leaving Hollywood vulnerable tocompetition from uh from the
internet and from ininternational and and uh just
changing the nature of thisbusiness.
SPEAKER_01 (05:53):
I remember talking to Rupert Murdoch about why he
chose to sell the entertainmentassets of Fox to Disney, and his
reply was, do you know how manyfeature films we make in a year?
And I said, Well, I don't know,20, 25.
He said it's 14 to 16.
He said, Do you know how manyfeature-length films Netflix
(06:15):
makes in a year?
And I said, I don't know, 20,25.
And he said, 40.
And so truthfully, we can nolonger compete.
SPEAKER_00 (06:27):
At the time that that they sold it, Netflix had
come out of nowhere and theirproduction budget for film, I th
I believe was as much as everyother studio combined for a
while.
So it was it it it was likenothing Hollywood had had ever
seen.
And they also brought with themthis new business model that uh
you know, on on on the one hand,you you you say uh Netflix is
(06:49):
doing its own business, let themlet other companies try uh try
different things and and and andthat would be for the for the
best for Hollywood.
The corrosive effect thatNetflix has is really how other
companies influenced or imitatedthem and more than more than how
they didn't know.
So the the model that that thatthey brought in is they
(07:09):
eliminated the idea of thatproducers and and participants
in a in a production and own apiece of it and the back end.
They said, we will pay enormousamounts like no one had ever
seen, and we'll buy out the backend as it's called.
We'll have 100% ownership inperpetuity on on all these
productions.
That is a a practice that hasbeen increasingly uh imitated
(07:33):
elsewhere, and that is that ispart of the consolidation and
the the the fincen problem thatyou no longer have these
independent groups who can makea living off it.
And also from a consumerperspective, independent
producers were there to ensurethe quality.
That you you had someone incharge of the quality.
You had you had people reallyinvested in the success of every
(07:55):
production, and you had peoplewho had a big outcome in trying
new things and doing and takingchances and taking risks that
you know a few a few majorplayers, Netflix and Disney
being at the top, those, aren'tincentivized to do in that way.
SPEAKER_01 (08:09):
One of the big themes of your writing is the
diminishment of risk, thateverything essentially is
risk-averse.
Has that just becomedramatically more evident in the
course of your career writingabout Hollywood?
SPEAKER_00 (08:25):
Uh certainly.
It started first with film, andit actually came sort of pr pre
um internet.
It be it came from this uh thisidea, the sort of big IP idea
led by uh Robert Eigert ofDisney.
That the problem with withmaking a film is that you make a
new movie and you're puttingtogether an entire business from
(08:46):
scratch, and you don't know whothe consumers are, you don't
know if there will be anyconsumers.
You've got to teach the audienceand the world what this new
thing is and have to get them tocome to movie theaters within
this three-day window, thisexact three-day window
essentially, to make to make ita success.
And under Iger at Disney, theythey they they took over Pixar
(09:08):
and Marvel and Luke Some.
They had these ideas that youcould have a strategy that was
entirely sort of sequels and andand remakes and these universes,
as they call as they came tocall it with uh with Marvel, and
that you could essentially getout of the idea of having to
make risky original things.
And that was enormouslysuccessful for them for about 10
(09:32):
years.
There was a year when I thinkDisney alone, this one studio,
accounted for more than half ofthe box office.
I think that was in 2019.
And every other studio did it.
The problem, of course, iseventually you've got to
introduce new things, especiallyin entertainment where novelty
is the entire, it's it's notjust a feature.
It's like I mean, you can keepselling Quake Roats oatmeal or
(09:55):
uh or or bathroom tissue thesame and make little tweaks on
it forever.
But but if movies lookessentially the same now as they
did 10 years before, you'regonna your audience is gonna go
running.
So that was that that that wasthe problem with that.
And that that so movies lost hisoriginality and it kind of
migrated over to streaming,where they went from 200 shows
(10:18):
to 700 shows they were making,which gave them room to take all
kinds of chances, all kinds ofrisks, and do all sorts of crazy
things.
Now the streaming world isbecause of consolidation,
because the boom is seemingbusting because basically Disney
and and Netflix have maxed outon subscribers and are now
looking to maintain.
They have become morerisk-averse too, and are going
(10:40):
to much safer things.
So it's a problem across thebusiness.
SPEAKER_01 (10:45):
Is there a reason that Disney can't find a chief
executive other than Bob?
SPEAKER_00 (10:50):
Well, they they they they've they've got one now,
Josh Josh DeMarrow.
Uh I mean, what they made clearin his appointment is that
Disney is essentially a parksbusiness, and that the theme
parks are the the engine of thewhole thing, and that everything
else is just uh feeding intothat.
They paired him with uhessentially with Dana Walden,
(11:11):
who will be in charge of thegraded thing, and hopefully she
can keep creating new charactersand new stories that essentially
become rides and cruise shipsdown the line.
The interesting thing aboutbeing a becoming a studio CEO is
that it takes so long to makemovies that when you come in for
about three years, you're justyou're you're just living off
(11:31):
whatever your predecessor did,and you get all the credit in
blank.
Like Toy Story this weekend ToyStory was an enormous hit, the
biggest hit at opening of theyear.
So that will all be seen as toJosh DeMarrow's credit, but you
know, that was a that was amovie that was put into work
probably five, seven years agoof a series that started before
(11:52):
Bob Iger, under what MichaelIser was CEO, but it will all be
Josh DeMarrow's uh credit there.
SPEAKER_01 (11:59):
It's interesting that films are really about to,
you know, or the point is tocreate a uh ride at an amusement
park.
SPEAKER_00 (12:08):
I mean that when you look at the the the amount of
money those parks those parks uhchurn out and uh the parks and
they have cruise ships also now,and it's it I mean the amount of
revenue that drives to the wholethe whole system is
incomparable.
SPEAKER_01 (12:21):
So we have to talk about Paramount, because that's
all anybody is talking about.
Give us your take on Paramount,Warner Brothers Discovery
tie-up, I guess.
SPEAKER_00 (12:32):
Well, it's uh it's it's another front in the uh in
the FinCon war here and them andand consolidation and bringing
everything together under oneroof, which uh for a lot of us
uh think augers bad things forthe industry.
It's interesting because if ifit had been Netflix had won the
war, it would have been a moresort of lean conversation about
(12:53):
consolidation and those effectsuh because it's paramount and
because of the Ellison familyand their closeness with Trump
and and and their willingness uhto send all sorts of happy
signals to this administrationas it reviews this project, it
it's it's also become apolitical dispute.
But uh you know, I uh I wouldsay t tempers are rising on it.
(13:16):
It will be I I believe thelargest uh LBO in in US history,
you'd probably know that betterthan me.
But uh, I think it is, yeah.
But uh the and the question isthat it the estimates is that
will leave them in about eightybillion dollars of debt.
So it if it's going to be thisnew giant studio to compete with
Netflix, but they're sitting oneighty billion dollars of debt,
you know, the the film divisionin a good year might have turned
(13:38):
out might have brought in twobillion dollars of uh gross
receipts.
Uh how they make a dent in thatin in that in that number is a
big question, and they haven'treally told us much about that,
and they haven't told so is thisjust going to be you know, the
the fear is that thisconsolidation will lead to just
a huge streamlining and them andthen them selling off parts and
(14:02):
the combined company being muchdiminished.
You know, the the the answeragainst that is well the
Ellisons have a lot of money andthey can do whatever they want.
And surely they didn't buy thiscompany just to strip it down,
which I I've I've floated someconspiratorial thinking that
maybe this is all aboutsomething else, all about
something bigger in the Ellisonworld.
(14:22):
But that those are those arethose are the many fronts here.
SPEAKER_01 (14:25):
Can can you uh tell us what the conspiracy theories
are?
SPEAKER_00 (14:29):
I I just I look at I look at this and say, I don't
see the the path to this being aprofitable business.
I I I don't and I don't I don'tsee why Larry Ellison would go
down this road.
And I also see that they arewhatever what they are very
loudly attempting to telegraphto the administration their
their loyalty and support forhim in and in in the moves that
(14:51):
that that they're making here,which makes me wonder is there
some sort of bigger Oraclebenefit that this is basically a
a marketing tool for uh forthat.
And that that gets into a worldbeyond my knowledge.
I'd well they give healthcare toOracle or something, or all all
the all the government's cloudaccounts to Oracle or something
(15:14):
that makes the uh you know, inthe end, I think they'll put in
personally 40, 50 billion thatmakes that 40 or 50 billion
insignificant.
SPEAKER_01 (15:23):
So I I wonder, because I do believe it has been
approved now, the deal has beenapproved by the FCC.
SPEAKER_00 (15:31):
It has, yeah, and the and and the Justice Barn
very which which apparentlypreempted its own lawyers'
review to approve it.
Uh now we await apparently thethe state's attorney generals
are are going to file suit.
Uh we don't know how many statesRob Bonta, California's attorney
general, has been leading thatand sort of dropping hints that
(15:52):
other states will be involved.
Uh and has said he we we don'tknow how many other states will
be involved, and we don't knowwhat court it will go through
and what their reaction to itwill be.
Um I'm I'm told the co the thecourt can pause it or the court
can let go through while whilethis suit works his way through.
And you also have the Europeans.
(16:12):
Uh I it's the the I think a lotof a lot of this a lot of the
transaction uh taking effectdepends on European approval of
it also.
And uh and they they they aredue to uh I think they're due to
weigh in any day now and uh saywhether they're gonna hold it
up.
So we're waiting for all that.
SPEAKER_01 (16:32):
So speaking of streaming, which we were uh Fox
just acquired Roku fortwenty-two billion dollars.
Explain to us why that's a smartmove or a bad move on Fox's.
SPEAKER_00 (16:44):
You call it FAST, uh the the the fast channels, the
ad support free ad supportedservices, which were which I've
now come down to essentiallyRoku and and Tubi.
And Fox also owns Tubi.
It's it's kind of the leastglamorous part of the industry,
so it it doesn't get a lot ofattention, uh, but it it takes
(17:05):
up uh when you when you look athow much of the the eyeball time
being spent by by by viewersthere between between those two
channels and what they'rewatching.
I mean, YouTube just dwarfseverything.
So it's a it's a huge sector ofof entertainment.
And Fox is making a a big moveinto it.
Again, the least glamorous partof entertainment, so it doesn't
(17:28):
get nearly the ink, it doesn'tget you know a millionth the ink
that say a little independentmovie does, but it's it's a
hugely consequential piece ofpiece of the business.
SPEAKER_01 (17:39):
Can anybody possibly compete with YouTube?
It seems to me that YouTube is,you know, the central station of
media outlets these days.
SPEAKER_00 (17:49):
Apart from TikTok, it's hard to see who really can
get into that business.
Uh YouTube but you YouTube stillhas really declined to get to to
jump into original production,and that's what leaves you know
this opening for everything elsein Hollywood, because they they
they still are happy to just tohave influencers and micro
(18:12):
things.
The influencers can't can't funda twenty million dollar an
episode production bill.
So that's not gonna happen thereunless unless the company
supports it.
And you know, if the companydecided, well, we're we're gonna
fund a ten billion dollarproduction budget tomorrow, they
could they they could say we canfund a hundred billion dollar
(18:33):
production budget tomorrow withcash on hand, probably.
But that that that you know thatthat that is that sort of thing
that Amazon or or or Apple orYouTube would get into that in a
serious way is the thing thatkeeps even Netflix awake at
night.
The idea that they could thatthey would decide that they are
(18:54):
going to just own this uh thethe this sector, but they're
clining to to go that far thatdeep into it is what allows the
others to come to to survive,essentially.
SPEAKER_01 (19:05):
Aaron Powell One thing that's changed uh
dramatically since you've beenuh writing, even for the anchor
since you've been writing aboutuh Hollywood and the media
business more generally, is thearrival of AI and the the
unbelievably uh inexpensiveability to to make you know
eventually, I guess, feature lefeature-length films just using
(19:28):
the AI tools that uh DeepMindand and Chat GPT, etc.
uh provide.
What do you think the impact ofAI is now and what do you think
the impact is going to be onHollywood's business and on on
the creative side of theHollywood business?
SPEAKER_00 (19:44):
It's become almost a moral panic at this point where
where directors as they theylaunch their film are terrified
that of the questions they'regonna get about how much AI did
use.
And you know, if a productionassistant sent a sent sent a
text to the director saying,What do you want in your coffee?
and and it that that was spellchecked by the by by the phone,
(20:06):
then that film used AItechnically.
So it's it's very hard for amovie to say we didn't use AI,
but it but they every directoris being demanded, did you use
AI on this film?
And the ones that did are uhhave this sort of scarlet letter
over them because AI is seen asa thing that will swallow
creativity and the industry andtake all the jobs away.
(20:29):
I think the reality we we j wedon't know how it's going to
play out, but the idea this is acompetitive market for for
filmmaking.
There was a a one that was verynoted at Sundance where it was a
probably a five million dollarbudget on that film, but it
looked like a$50 million film.
It was very uh it looked like avery polished, accomplished film
(20:52):
in a way that an independentfilm usually couldn't have.
And a lot of people suspectedthere was a lot of AI tools that
went into making that.
But so on the one hand, you cansay, and it's probably true,
that will take the jobs awayfrom a lot of people.
On the other hand, for studios,if if they can have five million
dollars that look like$50million movies, they're probably
(21:12):
gonna green light a lot more ofthose movies and put a lot more
of those movies into production.
And at the upper end of thatscope, where you have movies
with$200 million budgets, theywant to save, they they do want
to save money, but they're alsocompeting against other other
movies.
So if if you have a$200 millionbudget and say AI lets you take
$50 million off that budget,then that's great for your
(21:36):
budget there.
But you have another moviecoming out that was a$200
million budget that will thatwill take those uh those
improvements and build on them,and that will be a$200 million
movie that will now look like a$1 billion movie, and you'll be
competing against that.
So the idea that you just pocketthese savings and lay people off
and do everything much smalleris not how Hollywood produced.
(22:00):
traditionally works.
But there's undoubtedly vastareas where we're we're where
people can can do it.
But in the end, I thinktechnology in Hollywood
generally becomes a tool in thehands of of uh of creative
people.
And and and that's that's that'swhere this will end up.
SPEAKER_01 (22:18):
Amazon owns uh MGM studios.
So they're actively in uh thefilm business.
They also have enormouscapability on the AI side of
things, as well as obviouslyAmazon Web Services.
So it it would seem like theywould be an enormous threat to
Netflix because, you know, oftheir wherewithal, of their now
(22:41):
standing in Hollywood, etcetera.
Are there contracts, are therelabor contracts that prevent
them from doing as much as theymight with AI?
SPEAKER_00 (22:50):
Aaron Ross Powell To some extent they're they're
working here, but it's the Imean there are there are things
like you you you can't just takeBrad Pitt's image and create a
and create a synthetic Brad Pittwithout Brad Pitt's involvement
and and and and not pay him forthat.
But I mean someone will make anentirely AI generated movie
someone will press a button anda movie will pop out and someone
(23:13):
will distribute that somewhereand we'll see how that does.
My guess is is not very good.
I spoke to just talked to uhChris Melanandry who who's uh
the the uh the head ofIllumination studios and uh the
new movie Minions is going to bea big big hit here and he he
talks about the word uh the thethe idea of incongruity that
(23:35):
incongruity is what really fuelsentertainment and incongruity is
what the things that you wouldnever think of that to fit
together and the things that nocomputer algorithm could tell
you that go together.
But the these sort the themistakes the happy accidents and
the little things are what drivecreative development and and uh
(23:57):
you know I when when people dothe whole AI generated movie I'd
just say I'm you know myattitude is let let them do it
and and and let's see how thatworks out for them.
I don't I I don't think it'sgonna go very well.
On the other hand of it on theother hand using AI to improve
effects and all that well usingcomputer generated tools to do
that has been going on for 30years.
(24:19):
That's that's a that that's aprocess.
And it has led to lots of cutsin lots of ways and and and that
is unfortunate.
But before AI there weren't lesspeople working in uh in the Zen
they they were being exportedand they explored and they were
doing it abroad and it was nolonger a centralized system but
the people were using thesetools and building on them
(24:40):
rather than just pocketing thethe savings.
SPEAKER_01 (24:44):
One of the themes I guess of of news items is the
rise of China and China has inthe past anyway been a major
consumer of U.S.
uh film industry product orwhatever you want to call it and
and that seems to have changedthat seems to have diminished.
Is that is that true?
(25:05):
Has it diminished?
Is the the market closing downor what what's going on with the
U.S.
SPEAKER_00 (25:11):
film industry and China you know we we haven't
gotten a clear sense of that andit it it doesn't it it seems
like a bit less so but you stillhave some films that are
performing well uh there therehasn't been one clear message of
of where it was Hollywood alwayshas like the thing that's gonna
that's going to save it.
And the it you know we we sortof lurch from one disaster to
(25:33):
like oh here's a the big thing.
And most recently with livesports was the thing that was
gonna that was going to saveHollywood.
But the one before that wasChina.
China was the thing that wasgoing to save Hollywood.
It's no longer be looked at thatway like like that that this
huge Chinese market can come inand save us.
But I I think with individualfilms it still makes makes a
(25:55):
difference.
So that really uh sets them tothe side for for the the the
major business going on here.
But still an open question.
SPEAKER_01 (26:06):
Another thing that's always talked about is the rise
of TikTok and Instagram and youknow attention span being what
it is that the most anybody canhandle is a one minute snippet
on TikTok or Instagram.
How real is that how real isthat uh narrative I guess?
Is is TikTok, are TikTok andYouTube and Instagram making it
(26:32):
more difficult for the studiosto reach a larger audience?
SPEAKER_00 (26:36):
I mean when you look at just sort of eyeball time
those things dwarf anything thatHollywood does.
It's it's it's it it's vastlybetter.
But you know that a TikTok videocan't get people to get a
babysitter and come take theirfamilies to to spend$100 at the
movie theater.
It can't it it it can't getpeople to it in general to pay a
(27:00):
$20 monthly subscription fee forservices.
It can't and it can't it it'snot where sort of premium
advertisers are looking to to toto place their their their
advertisements.
So it's not it for sheer eyeballtime it's it's competitive but
it's not it it it in many waysit's just not in the same
(27:21):
business as as we are.
And in the end that you know weall hit up hit the problem of
there's only 24 hours in a dayand seven days in a week and and
that can only be divided so manyways but you when you when you
look at when you look at the thethe successive choice story this
weekend the I YouTube has beenaround for a long time and I and
(27:42):
the appetite for for featurefilms certainly the appetite for
produced TV shows has notdiminished at all.
So it's it's it's still there.
The the more interesting thingyou you've seen this year you've
had a couple of these horrorfilms that have come out of the
YouTube world obsession andbackrooms become massive hits
and it it spawned a lot of talkabout how YouTube will be an
(28:06):
incubator for the new talentthat will will come out and that
that will probably be the thenext thing that will save that
that is going to save Hollywoodand we'll we'll see how that
works out.
SPEAKER_01 (28:17):
So I can I'm I'm a scaredy cat so I can't watch
horror movies as I I get thatgets worse as I get older I I I
found but but but what is thedeal with horror movies?
They seem to come out I w I wentto the movies we went to see uh
what's his name Ryan Goslingmovie uh Hail Mary which was
(28:37):
fantastic and you know becauseuh the actual AMC theater needs
to you know make as much moneyas possible I guess there are
about ten trailers that go onbefore the movie so if you get a
330 movie actually doesn't starttill like four but you know at
least five of them are horrormovies.
So the what's the audience forthat?
SPEAKER_00 (28:58):
I mean horror movies have been the most consistent
genre of Hollywood since thevery since the dawn of Hollywood
and it's the one genre thatnever really goes away that sort
of reinvents itself every decadewith with a new version all
through the 90s where there areall these independent films
going on horror was still strongwith the the the scream series
that other genres kind of comeand go but horror is always is
(29:22):
always there and it's it'salways appealed to young people
going to the movies together andthis is this is this is a big
big thing that Hollywood istrying to work for how do you
get young people to the moviesand Holly and horror is always
skewed very young.
It's always been kind of acommunal sort of thrill ride for
the for for for for people to goto and I I I think it's kind of
(29:45):
it's it's always been prominentbut it's it be kind of become
more prominent as other genreshave receded so it it it it it
seemed bigger and and Hollywoodalso become and Howard also
because it's very it'srelatively very cheap to make
compared to say a Marvel film,it it allows for a lot more
experimentation, a lot more kindof new voices to be part of it.
SPEAKER_01 (30:09):
One of the things that surprised me during the
pandemic given how grim it wasthat Hollywood produced it
seemed to me virtually nocomedies to sort of relieve
people's angst about what washappening with the pandemic.
Was that surprising to you?
Or was it just that the pandemichit it takes a year and a half
(30:30):
to make a comedy and by then youknow they would think well the
pandemic's going to be over sowhy do that?
SPEAKER_00 (30:35):
What h whatever happened to comedy, I guess is
the answer I mean there this isthis is this has been the
subject this will be the subjectof PhD thesis because comedy has
drama and comedy or comedy andtragedy are the perennial the
perennial spectrum and it's it'ssort of and it it's really
disappeared.
You just you just had in thelast few years the studio is
(30:58):
barely making things that arepure comedies.
I think they're releasingsomething like five of them this
year.
It's almost disappeared fromfrom from the menu here and I I
think there's a lot of thingsthat have happened um the the
the one one that preceded theinternet is is the perennial
problem that pseudo people pointto is that comedies don't
(31:20):
travel.
Every country's idea of comedyis very unique and idiosyncratic
and comedies have not in generalplayed as well overseas as as
other kinds of films.
So that that that's always beensomething against them.
You had the kind of wokebacklash to a lot of different
(31:40):
comedians that sort of madevarious kinds of edgy comedy and
sort that that sort of came upas there was a a style of comedy
exemplified by the hangover thatwas kind of seen as sort of frat
boyish all the more so it kindof squashed that and it it led
to the idea that people don'tfeel safe to laugh at things
together in the world.
(32:01):
So and whether that is true ornot a lot of studio executives
definitely believed believe thatand believe that making sort of
edgy comedy and R-rated comedywas was was a dangerous thing
that that that got them introuble.
So the the dominant form offilmmaking in the last 20 years
has been the action comedy whichis kind of comedy so if you look
(32:24):
at Marvel films it they all kindof fit into action comedy so
it's kind of swallowed up a lotof the comedy demand from that
and then you had you had thestreaming world kept uh Netflix
in particular made a lot ofcomedies and made people think
well maybe come maybe maybestreaming is the place for these
things now.
So you had a lot of differentvoices I think there's there's
(32:45):
more things coming into thesystem there's when I a lot of
this kind of starts andpercolates up from the the
independent world and atSundance last time was there
were a lot of comedies thatbroke out of there.
So you just you need one or twoof those things to really break
through in the way that thesehorror films broke through and
and and Hollywood wakes up toit.
(33:06):
But it's it's uh it's a bigproblem.
SPEAKER_01 (33:08):
So do you go to these things?
SPEAKER_00 (33:10):
Do you go to the Sundance Film Festival and the
Tridecca Film Festival and theCannes Film Festival or do you
just stay in LA and the the thedeal I've negotiated with my
family allows me three festivalsa year which are Sundance and
then the Toronto Film Festivalin the fall which was where a
lot of sort of the Oscar filmdebut and it's kind of a good
(33:32):
one to go to it's kind of thefestival of festivals is how
they refer to it where they theybring films that have done well
at other festivals there.
And then I go to a Cinemacon inLos which isn't a a festival as
much as the gathering of the ofof the theater owners in America
they do that in Las Vegas inApril every year where the
studios present their plates.
So those are my permitted uhexcursions every year.
SPEAKER_01 (33:55):
Aaron Ross Powell I left working for Mr.
Murdoch in 2019 early 2019.
And my goal in life has alwaysbeen to report to no one and
have no one report to me.
So I achieved this by going onSubstack and starting news items
although I do have a couple ofpeople who help on the on the
product but you started in 2018was was it the same thing you
(34:18):
you desired to not report toanybody and have no one report
to you and then it got sosuccessful it became a real
business?
SPEAKER_00 (34:25):
That was what I was uh thinking.
I just that uh having I I'dspent the past decade and a half
kind of working more as aneditor than a writer on various
uh websites or failing mediacompanies trying to trying to
start a web venture and I Idecided I I didn't want to deal
with the problems of otheremployees.
I didn't want to deal with theproblems of uh of of other
(34:46):
companies I just wanted to dealwith my own problems for a
while.
So I started that and then thebut one thing that happened was
happening when I started doingthat when you started doing this
the marketplace for newsletterswas was very uh open and I'm I
mean it wasn't I was the best atdoing what I was doing.
I was the only person doing anewsletter like this uh for
(35:06):
Hollywood at the time.
So you had a lot of feel but itwas becoming increasingly more
crowded and I was seeing this isgoing to become harder for one
person alone to to sustain andbuild something and I and Janice
Minn who is a legendary editorwithin within within Hollywood
in the trade world approached meabout the idea of building
(35:26):
something bigger around it.
So I I really have the best ofall worlds now and that I can
that that she's built this uhthe this this big operation
around me and I get to just uhfocus on all my own problems and
issues and everything.
SPEAKER_01 (35:40):
So when you did the deal with Janice was that you
you presumably obviously came toan agreement with her okay let's
take this thing bigger and didyou go out and raise money to
make it bigger or how did theyraised a very small amount of
money.
SPEAKER_00 (35:54):
We we we we went into we actually the Substack
folks suggested just that wejoined Y Combinator and and
introduced us to them.
So we actually did a a YCombinator training program and
the the or their their or theiruh boot camp there and they
really persuaded us like you'reyou're a profitable business
already why why do why do youwant to raise money?
(36:16):
What uh what what do you so wewe raised a a really small
amount of money and we haven'traised money since then uh we've
we've gone we've we've lived offour revenue we've been
profitable the whole time andand grown on our revenue which
you know at this point stillowning the full business and and
having all the assets gives us alot of choices so the the Anchor
(36:37):
is at theankler.com and I'veI've started a new little side
project on my own kind ofprivate substack uh called the
Rushfield Jamboree which is kindof my my sandbox where I'm gonna
start doing a daily interviewshow and other other sorts of
things on there which is part ofAnchormedia but is uh my own
(36:58):
little playground.
SPEAKER_01 (37:00):
So theanchler does you you go there tell tell our
audience because I think a lotof people are really interested
in in what's happening inHollywood but I think people are
always interested in what'shappening in Hollywood.
SPEAKER_00 (37:13):
What what are the verticals as they say what are
your verticals that we're we'relooking at uh kind of the the
the the places that the tradesand traditional media don't
cover we have a report on on whojust covers the uh influencer
sphere like and subscribe wehave we have we have we have a a
morning newsletter sort ofsimilar to what you do but for
(37:33):
for for the entertainment worldspecifically called the uh the
wake up uh Sean McCulty sort ofbreaks down the numbers we have
uh the few people focused onreally just the TV business the
business side of of the TVbusiness we have people we we
have another one called prestigejunkies that uh that focuses on
the awards races and the Oscarfilms and and kind of the the
(37:57):
high-end films there we have awe have an AI column we have uh
Eric Wehrmark uh AI professionalhas a that does a a weekly
newsletter just about AI so wehave a lot of a lot of different
things there.
And how much does Hollywood hateyou?
Hollywood hates who it'sconvenient for Hollywood to
hate.
So it's uh they they wouldprefer the they would always
(38:20):
prefer that no one have anyopinions about about about their
work all the time.
They're probably not alone inthat in the world but but you
know I I would say many of myclosest sources and uh and best
advisors they they come aboutthey they we we start because
they call me to yell at mesomething I write that really
incense them and then we havelunch and we're we're best
(38:41):
friends after that.
So it's uh when when it when itserves their interests to hate
me they will they they will theywill hate me very very
vociferously it's the classicthing where they call you up,
they berate you and then thenext day they say hey I've got a
great story for that you can'tthink about whether they like
you or hate you because thosearen't really operative are they
(39:03):
paying attention or are theyreading you is what you what you
got all you can think about.
SPEAKER_01 (39:07):
Aaron Ross Powell Any more books coming from you
or uh or you're otherwise toobusy?
SPEAKER_00 (39:12):
I've got a a a book about Hollywood in the 90s that
I will write when I retire.
This uh doing doing two c I dotwo columns a week and a daily
interview show and then one biginterview a week and and and
various events and other thingsso sadly there's not much not
much time for book book writingbut someday retirement will come
and uh and my fourth book willwill follow.
SPEAKER_01 (39:35):
All right Richard well we take in more than enough
of your time to thank you verymuch for doing this we
appreciate it and uh we'll talkto you next time thanks so much
for having me and thank youagain for all you do there.
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