Bloomberg Audio Studios, podcasts, radio news. Well, let's get through the main stage here at Bloomberg screen Time go into a conversation with hambla Abdy and Michael de Luca. They're the co chair and CEOs of Warner Brothers Motion Pictures Group.
I want to start on the state of the movie business because you were two of the biggest cinophiles in the world, I'd say, and I was listening to an appearance you guys made on the SmartLess podcast earlier this year, and you were talking about how there are not enough movies being made and you're sort of I was struck because you guys run a movie studio that would seem to be within your power to decide how many movies you make, So why don't you and your peers make more movies?
Well, we have made more movies, so you know are One of the first things we were tasked to do when we got to the studio was increased the output, and I think we increased it from I think when we got there it was four to six movies and we're up to twelve this year, heading towards eighteen hopefully, so we're doing our part. I feel like and one
of the most amazing things. The reason we're so optimistic about our business is Warner Brothers achieved four billion in worldwide gross this year, the first time since twenty nineteen, so at least in terms of our studio, we're already at pre pandemic levels. But I think the most significant metric is we did it on nine less movies than
twenty nineteen. We did it on eleven movies, and they had twenty shots at it, which I think shows that there's a robust theatrical audience just waiting for more movies to get made.
They always talk about, you know, box.
Offices down anywhere from twenty five to thirty percent, but there's also twenty five percent less movies right in the marketplace. So that's why we always feel like it's a it's a glass half full situation, and if there were more movies, you'd see that box office climb.
Well. One of the reasons that I assume that the number of movies is down is how expensive it has become to make them. So, as someone who's not part of the sausage making process, why does it feel like every major studio release now costs two hundred million dollars.
I don't think every.
Weapons did not. But can we agree that the cost of making movies has gone up a lot?
Sure, we can absolutely agree.
I think the way we look at it is a diverse slate, right, And we look at different metrics and different size movies, and it's really about balancing the slates. So there's no one size fits all approach to budgeting of film. You have to meet with the filmmaker. You have to look at what the story is, who the audience is, what genre is. We share it with our teams around the world, and we all come up with
the right size budget for that film. And it's really it really leads with being based on the vision.
Of the filmmaker.
Right. Okay, that does make me want to I wasn't going to get here yet, but I want to zoom ahead to the movie you just released one battle after another, Paul Thomas A Andason movie. Great movie. Everyone thinks it's, if not the front runner for Best Picture one of them. You gave one hundred and thirty five million dollar budget to a director who never had a movie gross one hundred million dollars. Can you walk me through how that worked in your the formula you were just talking.
About not confirming that that's the budget. Okay, however to point take in that it's Paul's most expensive movie, I think when you know, when we all read it in this Pam set in our organization, you know, we are really big on sharing the script with our teams, both international domestic. Everybody who's got a stake in that movie's success gets to weigh in, and we arrive as many studios as all the studios do with a model that
basically informs the green light process. So we read this two and a half years ago as a as a satirical action comedy with Leo, and you know, because it read like the masterpiece it is, we leaned in, like if we we set up the kind of you know, rigorous analysis that enables us to trigger a green light, but if it's a if it's a you know, a bold provocative swing, we're just our dna is to lean in and give it a shot.
So Leo's comps kind.
Of gave it the credibility to say, well, we can aim for the high case. But really what carried the day was just it read like the movie it is. It just read like a masterpiece and one of the overriding operating principles at the studio is to is to continue that legacy of Warren, whether it was Stanley Kubrick
or Queen Eastwood or Ben Affleck. But get into these situations with the best filmmakers of the day and try to bring people, try to bring audiences or a star for originality, you know, new masterpieces, new modern masterpieces, and that's that's what we feel like Paul's given us.
So we're going to set aside the masterpiece part of the conversation for a second. Do you think that the movie will be a commercial success?
I do.
I'm a believer. It's a marathon with this movie, not a sprint. I think it's going to lag out to a number that we'll be happy with.
Yeah, but it's hard. We can't divorce.
I'd be lying if I said we're divorcing it from the pride we have in it, and you know it's it. And also with Weapons and Centers, what those three movies say about the chances for original films to get made, you know, from the best directors working today.
It's where Warner Brothers.
Wants to be and it goes into our overall strategy.
You know, when we met with David three years ago, we sat down and we said very clearly, let's bring the best storytellers to Warner Brothers.
And that's what we've done.
We've tried to do a mix of IP movies genre films. It's really about the balance of the whole slate, and you know, David us he's been so supportive in that. And I feel like this year our slate really, you know, shows what our mission is.
Would you say that David has always been supportive, Yes, from day one? And well, okay, we got we have We have to address the fact that earlier this year he was out there meeting with people. It was he was not being very subtle about potentially looking for replacements for you.
Listen, we can't we can't address the speculation and rumors and all that stuff. All I can say is, David, Mike and I had the privilege of seeing all these movies early. We knew what we had with the filmmakers and with these stories, and we just couldn't wait for audiences to see them. So we David was completely supportive of every film and of Mike and I and the choices we made.
Well, you got re upped yesterday, So clearly when you go in a tear whatever your boss may or may not be thinking for some just ae strategy.
Well, it got announced yesterday, but as it had been done before.
The hot streak for the year I feel like started with Minecraft. Is that fair to say? For a long time, movies based on video games, TV shows based on video games didn't work, And that's totally flipped in the last couple of years. We just had David talking about about Call of Duty. What do you think has there been some change in culture as to why these movies are now working or is it.
I think it all goes back to talent, you know, Like we don't. I think it's dangerous to traffic and blanket statements or any any genre, any adapting from any medium. So I don't know how other people do it, but we look at adapting from a video game the way you look at adapting from a book or a play or anything it's not a movie, and just try to apply the same basic rules of common sense. Do we have the right writer, Do we have the right writing team,
do we have the right filmmaker. I think anything can become a great movie if the filmmakers are castwell got it.
That was followed by Sinners Big Swing. Were you at any point nervous about how it was going to do?
No, I mean, I think from the moment we read the script, Ryan is just a singular visionary filmmaker. The moment we read the script, we saw it on the page collaborating with him. I mean, I just think what this movie has meant to audiences and how it's ignited them in conversation. I mean, there was this amazing moment
that happened over the course of the film. When it was released, there was an open letter written to the studio and to Ryan from a young man from Clarksdale, Mississippi, who drove ninety minutes twice to see the film because Clarksdale doesn't have a movie theater, so we brought a movie theater to Clarksdale, Mississippi, and we went down there for the weekend and we met members of the community and this young man who is an organizer, and it was, honestly,
it was one of the most special moments of my career. I can't tell you the conversations that were had and the audience feeling that movie, feeling that music, meeting the musicians who live and who Ludwig and Ryan gathered for the you know, from the Delta Blues to create this movie.
You can't take that away. That is the power of storytelling.
You talk about wanting to be in business with the best filmmakers. We have Ryan coming on later today, So I'm curious what like you've worked with between the two of you, probably most of the best directors in Hollywood. What is it that sets Ryan apart from his peers. Is there something specific about him that you feel like, you know, we.
Love all our children kind of a thing. But but I'll tell you, I'll tell you straight up. Ryan is all heart. And you know, he did a thing. We didn't think it was going to become a marketing tool, but he did a thing where he explained it was for code act. You know why he picked the film formats he picked and why. I mean, he's just talking
about purfs and things that I should know. I mean I kind of know, but he makes it completely not only understandable, but he managed in an instructional thing for Kodak to connect with cinephiles of like, Hey, the subtext was I made this for you. I took the time to really pour over what would be the best presentation of this story for you with theatrical audience, and they felt, Wow, this guy made it for us.
I'm going to go see it on a big screen.
Ryan's ability to connect with his audience both in the material and then just talking about his movies is really unique to Ryan, and we're now making every director do it, even if they have to get training.
One thing that was really well publicized leading up to the film's releases. In order to get the rights, you had agreed to give him ownership, I think twenty five years after the fact. Why do you think that became such a talking point and have you done that with other filmmakers previously.
I think I just think there was an outsized spec you know, conversation about it because it was unique, but it was unique to this movie, and it was unique to Ryan's you know, to this deal. Think the importance of this movie and how it's affected audiences is what we should all be talking about, because, honestly, I went to the theater that opening weekend and seeing audiences on seventy MILIAMUIN or Imax.
It's the greatest feeling in the world.
Both of you talked about the codec video. One of the things that I think Mindcraft and Centers shared is they both developed a lot of momentum online which felt organic, and so I'm curious when it feels like a lot of things become hits almost beyond your control, how do you plan for that when you're thinking about green lights, when you're thinking about marketing, because you obviously can't factor in like, well, this one's going to go viral on TikTok and this one'st.
Well, you know.
The first one of the things Davids asked us with was, you know, even though we inherited the organization, what's the right balance for the era that we're in. So that involved a reorg of marketing and distribution. So when we elevated the next generation of marketing leadership at the studio, we talked.
About virality a lot.
We talked about where audiences are getting their movie advertising now and what the kindling is for each project to light those bonfires online and getting that core audience, whether it was the gamers on Minecraft or the African American audience on Sinners really White Hot over something you know that we knew they were going to like and being able to amplify that heat to the general audience really became the corner of the realm in our new marketing department.
So while you can't plan for it, you can arrange the chess pieces to take advantage of it if it happens.
Are we going to get sequels to either Minecraft or Sinners?
You're definitely going to get a sequel to Minecraft. You know, Sinners is such a singular vision from a signature filmmaker, and it wasn't really set up to be an expanded universe. We just think it's again another cinematic masterpiece. We're lucky to have.
Yeah.
Cool. One more question about this year's slate. You have I think the only all of the horror movies to gross more than one hundred million dollars, and nothing else has worked at that level other than our movies are good? Can you give some explanation for why your horror movies have worked better than others, including those from some people who've had a lot of success in the in the recent history. Sure.
I mean I got to call it.
Richard Brenner, who pitched a perfect game for us this year, and his second Lieutenant Dave Newstetter, when we looked at the ip that Newline was sitting on, you know, reactivating the Final Destination franchise, you know, adding to the Conjuring universe or priorities.
But we always try.
To when we're doing legacy sequels, we think it's really important to innovate within the genre or innovate within the franchise. So I think one of the reasons they overperformed, aside from the fact that you know, we supercharged the marketing department with fresh thinking, is Final Destination wasn't just another chapter. It was an idea by John Watts, you know, from the Spider Man trilogy, and it's kind of a fun story.
He had a first date with his with his soon to be wife at a Final Destination movie.
So it was an.
Incoming call that new and got John Watch was like, hey, do you mind if I come up with a story for Final Destination And they were like.
Yeah, that'd be great.
And then Zach and Adam who directed, brought this incredible sense of humor, and you know they did they did a real remember when they were when they were presenting to us of they worshiped the premise. Their approach to it was fresh and innovative, kind of give universal props for bringing that to Jurassic Park and through the Fast and Furious franchises. We think with franchises that are particularly long in the tooth, you really have to innovate within
the genre. So I think Final Destination overperformed because of Zach and Adam and just the thinking that went into it from John Watts and Michael Chavez. With conjuring, he received the reins you know from from James Want and Jayson Blum and kind of became the creative clearinghouse and his path. I think the common element is none of them were phoned in. None of them were Oh it's a bunch of executives in a room saying milk that franchise.
You know, it was talent first, So Michael's excitement, Zach and adams excitement. Audiences I think can tell when something is not prefabricated or phoned in, when it has a reason to be and we always think that's the filmmakers, so we were able to I think that's why those horror films overperformed. And then Zach is it. Kreiger is just a breath of fresh air for an audience. I still think that star for originality. He's just like a really exciting new presence.
Yes, the director of Web Yeah, yeah, Weapons.
I mean that was one of the best scripts I've read, and like probably last.
And just the just the quality of it. Yeah, I think it was key to that movie overperforming.
That's the other thing that's important is the script. You know, it all starts with the story, and it all starts with the script. And if it's on the page and you have the right filmmaker that approaches especially some of the IP with zero cynicism because they love the IP, they love these characters. I just think that magic comes together and that with the marketing is what makes it.
Although, to go back to your earlier question to Pam's point, I think one of the reasons negative costs have climbed out of control. And this is just was my experience as a producer studios when they green light something without a lock script and you're writing or in production or got rivid preprint, and then you're fixing in posts to
make a release date, you cost balloon. So if you can really be it's hard, But if you can really be disciplined about locking that script before green light and not having to have to face twenty thirty forty percent of the movie reshot and post, especially on a special effects movie, you can maintain some cost controls. We we lowered the average native costs at the studio from like you know, one sixty eight to one twenty eight or one oh six even this year, and it just takes discipline.
We're going to ask the audience the question so that so that we don't have to make you choose between your children. Okay, but I'm still going to ask you for your thank you.
It's very compassionate of you.
Which director has had the best career? I guess that really depends on what is that? What is it are you talking about commercially? Are you talking about who's just made the best movies, who's made the most interesting range of movies.
It's kind of fun to throw that up the dough and see how your audience will.
Will get the answer. To get the answer, yes, we will see how the audience deals. I Like I said, I wasn't going to ask you a lot about M and A, but I do have to ask you, how are you guys feeling about the spin of your company and what is kind of what is the mood internally about the changes to come.
Yeah, we're I mean, listen, we're focused.
As you know, we announced earlier that we're splitting the company too into two different entities, and that's where we're focused on. And really nothing has changed the day to day. We're co CEO's of the movie business. We're planning our slates for twenty six, we're planning our slates for twenty seven, so nothing has changed, and we're feeling really excited.
As you can imagine. You know, when there's a good run at a studio, morale is pretty high. So we have great morale at the studio right now. The team has clicked, you know, almost like a tribe or a family. It's been two years of transformation, and this slate was kind of the inaugural slate of the new Warner Brothers, so everyone's morale is very high.
But as far as the moment we.
Ran, you know, we just figured there's always going to be speculation and we just try to keep our heads down and stick to the job at hand.
And what has the response been like internally when you have sort of constant headlines about the guy who is just here buying your company.
You know, our north start, our north star is do the work.
Keep your head down and do the work. There's always going to be speculation in our business. We're in a you know, a massive time of disruption, and everyone's going to constantly be saying, what's going to happen next, who's going to be there, who's you know, you can't focus on that.
You have to focus on the work.
And I think what's so exciting about Warner Brothers right now, even though it's an over one hundred year old company, we all approach it with like startup energy. So it's just it's actually a really great time to be making movies and TV.
Our teams, you know, have our our teams are used to it because it's you know.
It's this company has been bought and soul.
Right or some of the some of the inherited Warner people, you know, understand this feeling. But to Pam's point about startup energy, when when when we started to work for David, you know, his one of his edicts to us is, you know, challenge all assumptions. You know, the business has to transform, it has to adapt to the moment we're in. And we talked about Moneyball a lot you know, because Billy Bean in that movie and in the book was
all about adapt or die. So the company right now has been battle tested and it has been challenging assumptions for two years. So we're heading as far as the day to day like we're heading for that split. That's the course that David has charted. And people trust David because this whole slate strategy, this whole diversified slate, the label strategy, getting DC up on his feet, getting new line, pumping, getting animation which comes online for us next year, pumping.
We still think it's the winning strategy and he was really the author of that for us.
Can we get the poll results back up there for one second, just because it looked like Jim Cameron was the big winner, followed by Pta. Okay, I also have an O bomb back last on that list. Note, but you have a right a movie coming out early next year, I believe, which is the Emerald Federl Bobbie movie Wuering Heights, if memory serves you won that in a sort of competitive auction against Netflix had a bigger bid, and Netflix did not offer a theatrical release. Why do you think
they still don't embrace theaters? And does that help you when you're competing for projects.
I can't speak to their strategy because obviously we don't work there. I just know that it's a choice for filmmakers, and I think both theatrical and streaming they can coexist. They're just different offerings and a different experience. And I think it really comes down to the filmmakers and where do they see the best way to view their film. And I think I'm withering. Emerald wanted a global theatrical release.
It is an epic love story and she wanted to She just chose, and Hear and Margo chose that they wanted, you know, the big theatrical release, and that's show up in theaters first and then go down through its different windows.
And that's how it ended up.
Do you think you could ever work at a company that didn't put its movies in theaters us?
Personally, to be honest with you, I've thought about this. I've thought about this just as a life choice before I went to work for MG. When I was when I was a producer, just at that point in my career as a producer, I was doing more series than features. And I think even though I didn't admit it to myself. I think personally, I don't think I want to be
around movies unless they're going to movie theaters. I think if I went back to producing and I was engaging with streamers who weren't offering theatrical releases, I'd probably be doing a lot of series. Yeah, a very personal, just personal feeling.
Yeah, I feel the same.
I just I go to the movies almost every weekend, my daughter and my husband and I.
It's something we love to do.
There's nothing like it, you know, There's nothing like sitting in a theater and laughing and crying and just experiencing something communally.
So I probably feel the same as Mike.
Yeah, we're gonna do some some quick fun movie questions to end. There's a lot of discussion about the dearth of new movie stars. Who do you think are the three young actors that can open a movie right now?
Smithy Schallome, Smthey Schallamy, Lawrence, I love, Florence Pugh's and Gaya ers Diakinson.
I think is a rise.
Like I think there's actually a great crop of new talent. I think young moviegoers want to create their own movie stars.
Yeah, are comic book movie is on the decline.
God, I hope not.
She knows I'm a giant conflict nerd, and I still I have my dull collection and my kid my childhood collection.
I let my mother throw out.
Any You can't stump him on any question about it.
I don't I agree with James gunn. I don't think there's super irri fatigue. I think there's mediocre movie fatigued. So I'm very gunshy of blanket statements.
But I thought what he.
Did, wouldn't that mean that every superhero movie getting released right now that isn't spider Man is mediocre?
No?
But I do think the bar for innovating within the genre is high, because you could have a good movie and you could be mediocre only because that movie has been made many times before.
You know it could be a good example of itself.
But if you're not innovating within the genre, you know, which I think is a high bar. We all have to clear on all kinds on every movie, but especially in a movie that in a genre that's been You've had a lot of it over the last ten years. The burden is to innovate. And I think what James did with Superman, you know, going back to the DNA of what made the character popular in the first place was kind of innovative because we've only had the dour version for so long.
Because you're a comic book I do have a favorite comic book movie.
I Love All My Children again.
But I was thirteen when Donner's Superman came out, and that was really the first big screen treatment of a comic book character. And in those days, you know, being a comic book fan wasn't hoity toity the way it is now, Like you would get picked on and beaten up. So when that movie came out, it was like the number one movie.
It was very validating and has stayed with me.
I know you don't like blanket statements, but we're going to go with a couple more. Will will comedies work in theaters at any play the game?
I believe they can. I'm in our comedy tell.
In fact, we just started shooting a comedy on Monday that Jonah Hill wrote and he's directing, and him and Kristen Wiger starring as these overprivileged brothers and brother and sisters who get cut off from their parents and it's hysterical and we just started on Monday.
You told me about that movie, and then I looked at the release late for next year, and I got very nervous that its stated against the Odyssey.
Oh, I think it's perfect that we were hoping for, like a repeater Barbenheimer.
We had a good time with Barbenheimer.
What is a movie that either one of you made that you feel didn't get as much petit as it should have.
Well, look, this is very personal. You're probably all going to go, what was that movie? What is he talking about? We made a movie called Serrano during the Pandemic for MGM that you're director with Peter dinkwish that I just cry through and love and I love all the music, and I was really sorry we couldn't do better by that movie.
Last question, do you feel that movies are as central to culture today as they were when you started your careers.
Absolutely.
I think it's harder to engage the audience today than maybe in the nineties when I started. But I think when you have that that storm that comes of a great filmmaker, a great story and kindling that you can ignite with marketing.
I do think it pierces the culture.
I think we've seen that this year, over and over again, whether it was Minecraft or Sinners or Weapons or even Paul's movie.
Again, I went to the theater and went to.
The Vista to watch Paul's movie in VistaVision and show it to my daughter last weekend for the first time, and it was like being in a rock concert.
The way it played. It was thrilling.
Yeah, I'll go one better.
I think it's a public health service that we provide because it's not a business.
Absolutely anything.
Today when we're David has TCM playing in his office twenty four to seven. You know, all we do is talk about movies all the time, and we talk about their empathy machines when you go into a theater, when you get off your couch, because let's face it, like, is life better if you isolate more? No, it's better
when you go out and feel some collective humanity. So when you're in a theater and you're in Minecraft, or you're in Centers, you're in any of our movies and people are laughing at the same joke or crying at the same heartbreak, you feel connected.
And that's a good thing and we should have more of it.