The Business of Entertainment

Digital Distribution Models: The New Wave or The End of an Era?

2011-10-15T12:22:00.001-07:00

I have commented on digital distribution before but I feel that I need to reexamine the topic after the controversy that surrounded the new film, Tower Heist. The film is directed by Brett Ratner, stars Eddie Murphy and Ben Stiller and is about “hard working guys finding out they've fallen victim to a wealthy business man's Ponzi scheme, so they conspire to rob his high-rise residence.” The controversy started when Universal, wanting to test their new experimental distribution model, decided to release the picture to video on demand only after three weeks of being in theaters for a price of $60. They wanted to test to see who would pay the price for the comfort of seeing the movie at home.

Personally every movie I have gone to since the beginning of this year has been a bad experience. It seems that this current generation of moviegoers does not understand how to go to a movie. They are rude, inconsiderate, and their attention spans are short lived. Their cell phones appear to be more entertaining than the movie they paid $12 to see. I have had to deal with people talking on their phones and constantly checking their Facebook and text messages throughout the film and with phone’s big screens these days those sort of activities do not go unnoticed to the other theater patrons. As a film lover I cannot stand being taken out of the film’s story because a blinding light keeps shining in my face every five seconds. Do I want theaters to become obsolete because I would pay for the VOD service in order to not have to put up with that? No, I do want theaters to become more proactive and stop blaming the studios. Put rules in place and monitor that they are followed so that everyone can have the movie experience the filmmakers wished them to have.

Back to the news – Universal pulled the plan after theater owners threatened to not play the picture at all in their theaters. Universal realized that they would lose a huge amount of the gross profit if they were to go through with this plan. My question to the studio is why plan to follow through with that experiment during the holiday season when theaters are packed with other choices for moviegoers? This gave the theater owners the leverage they needed to not just threaten but actually not have to show the film because their bottom line wouldn’t depend on it. Why do it with a film that is sure to tank at the box office anyway? Lastly, why start out with such a high model? $60 to the consumer is not a logical number in their mind. To them $60 is an amount they would gladly pay to the theater for six tickets because in their mind $10 per person, plus the cost of getting there and concessions equals an experience. $60 at home does not equal out to $10 per person because those same six people would be watching it at home, not spending the time to get ready and go anywhere, not buying extra concessions. Lastly because it feels like paying $60 for a film instead of $10 per person is a very steep number. Now if they were to start out with $30 for the VOD service to the same family of six that would mean that they get to see the same film for half the price of going to the theater and now the time, gas, or concessions are not factored into the experience as rational costs but irrational costs when they realize their out of pocket expense doubles.

Do theater owners have something to fear from VOD service? I would say no, that the two can go hand and hand much in the same way that television and radio went hand in hand when the advent of television was believed to be the extinction of radio. What I believe they do have to fear is that studios are part of a conglomerate who own the VOD channels and want something enticing to attract consumers as a way to increase their own bottom line. There needs to be a deal soon to bring peace to both parties because they could end up killing themselves in the act. Movie patrons could soon find that downloading high quality films from illegal sites is far easier and cost friendly than paying money to VOD or to theaters.

Occupy Wall Street

2011-10-04T18:03:00.000-07:00

Occupy Wall Street

This subject has been lingering on the edges of my perception for some time. I would see random clippings in the news as well as text crawlers during football games. I never paid attention to them until the two trade magazines I read, The Hollywood Reporter, and Daily Variety, mentioned them as headlines on October 3^rd.

For background on Occupy Wall Street, please go to this site that I found very helpful:

http://www.ufppc.org/us-a-world-news-mainmenu-35/10575-background-occupy-wall-street-basics.html

The call to arms happened with this poster made by Adbusters:

The main question that most seem to be asking, ironically the poster asks it as well, “What are the protestors demands?” Considering they claim “decisions are made by a "General Assembly" that is "a horizontal, autonomous, leaderless, modified-consensus-based system," it would appear obvious that they don’t even know what they seek. I work with the mayors and commissioners of Orlando and see protestors come in with groups that have no single leader with 20 or so people all using the public forum to voice their opinions. However the problem with this is that no one knows how to really appease them. Solutions are offered and at once rebutted, so most of the time it would appear that these people just want to have their voices heard… about something, anything… as long as they get their five minutes.

The most basic intention behind Occupy Wall Street has been described as, “a series of protests…. against social and economic inequality, corporate greed, and the influence of corporate money and lobbyists on government, among other concerns… Adbusters states that, "Beginning from one simple demand – a presidential commission to separate money from politics – we start setting the agenda for a new America." (Wikipedia)

International Business Times had this to say which I found most interesting; “The protest's organizers hope that the protestors themselves will formulate their own specific demands, expecting them to be focused on "taking to task the people who perpetrated the economic meltdown.” The reason I found this interesting is because protestors SHOULD look at their message as if they are formulating a business plan. They have to have a goal they are trying to achieve, a plan to reach that goal, and milestone markers to ensure that those steps are being reached. They also need to have a leader, I cannot stress this enough. They need someone to state their demands, negotiate on their behalf, and guide the protestors to the finish line of their goal. They also need to understand that they are going against businesses and businessmen respond positively to language they understand and negatively to people that do not have a plan. So protestors that belong to Occupy Wall Street, please get a leader to stand behind, with a plan of action, and goals that you want to achieve so that you and the people whose work you are disrupting can reach a peaceable agreement.

Sources:

Daily Variety

http://www.variety.com/article/VR1118043738

The Hollywood Reporter

http://www.hollywoodreporter.com/news/afl-cio-occupy-wall-street-protests-243242

International Business Times | New York

http://newyork.ibtimes.com/articles/215511/20110917/occupy-wall-street-new-york-saturday-protest.htm

Wikipedia

http://en.wikipedia.org/wiki/Occupy_Wall_Street

What I've Learned From the Business Plan Writers

2011-09-22T16:18:00.000-07:00

For the previous blog I discussed two business writers by the name of Dave Lavinsky and Christie Karis who offered great advice on how to formulate a business plan. They gave some great advice especially on the part of paying attention to your milestones in your business plan and of course don’t overlook the small things because those add up. I also love Mr. Lavinsky’s advice of not focusing on short-term profits rather than building long-term value. I am incorporating this advice into my own plan by recognizing to not get over excited about immediate profit and that for the first couple of years the goal is to grow a business. So any profit found should immediately be put back into the business so you can reach your long-term goals and achieve sustainability in the marketplace.

The specific changes I made are just that – I have made it an important priority to assign a financial advisor who is to pay strict attention to the fact that any profits, after all line items have been paid, is to go back into the business whether it is to promote it through advertising, upgrade software, hire more talented professionals, etc. I am not to get excited and immediately purchase items with the profits for my personal gain. I also love that Dave states that a business can fail because the owner was just a jerk. Many of the videos we have had to watch in class of interviews with business men all say the same thing; remain humble when you find success and people will continue to want your business. This I found to be very important advice and while it is not directly incorporated into my business plan it is going to be incorporated into my business model of operating. Great customer service is the key to success so turning into a jerk after a little bit of success will just doom the business to failure. After years of success... maybe then I can be a bit of a jerk… but that definitely will not come for quite a while.

“Experts Views on the Value of Business Plans”

2011-09-01T16:07:00.000-07:00

Dave Lavinsky – a prominent leader in the business plan arena.

Founder of Growthink, a company that helps entrepreneurs build a business plan, research their particular markets, investing, etc. He has also developed Growthink University, which helps business owners, entrepreneurs and business students learn how to raise capital. His current blog post is titled “Crowdfunding 101” and he gives his readers advice on this new form of fundraising that involves getting a regular group of individuals to invest in a project via the internet verses the normal model of getting money through bankers, etc.

There are two blogs in particular that I want to comment on from his site. The first is about business planning and is titled “Business Plan Milestones: How They are Essential To Your Success.” He talks about how a plan is meaningless unless you create the right milestones and stick to them. He explains with an antidote about how many steps it takes to pump your gas.

1. I pulled into the gas station. 

2. I pulled next to a pump. 

3. I put the car in park. 

4. I turned off my engine. 

5. I got out of the car. 

6. I popped open the gas flap. 

7. I swiped my credit card into the machine. 

8. I typed in my zip code. 

9. I pressed the button for the type of gas I wanted. 

10. I unscrewed the gas cap. 

11. I took the gas nozzle out of the machine and stuck it into my gas tank. 

12. I squeezed the lever. 

13. I waited while the tank filled up. 

14. I put the gas nozzle back into the machine. 

15. I pressed "no" I don't want a receipt.

16. I screwed my gas cap back on. 

17. I shut the gas flap. 

18. I got back in my car. 

19. I turned on the engine.

 20. I put the car in drive. 

21. I drove off.  

I thought this was a great illustration as to how many things we actually do in order to accomplish a task we believe is very simple. As far as your business goes and in order to attract investors, you must understand what your milestones are and what it takes to accomplish them. You may mark your milestone as different big accomplishments but it takes the little accomplishments to get there. Never forsake them in order to reach your goal faster, for that haste may actually cause your undoing.

The other blog I would like to mention is called “The 6 Untold Reasons Why Businesses Fail.” This caught my eye as normally sites hawk the number of reason a business plan succeeds or how to become rich through your business with these simple steps and lastly the top reasons for a business failure. I was intrigued… I wanted to know what the untold reasons were. To list them as he words them, they are:

1) Focusing on Short-Term Profits Rather than Building Long-Term Value

2) Ego Business vs. Business Opportunity

3) Life distractions

4) Bad feedback & white lies

5) Maybe the owner is just a jerk

6) The entrepreneur never took the full leap

For the complete answers behind these six reasons, visit http://www.growthink.com/content/6-untold-reasons-why-businesses-fail

Christie Karis

The second business plan expert I looked at was Christie Karis who is a woman that helps develop business plans for small business owners. Her site is very helpful as it includes samples for startup funding, business expansion, and raising capital. She has worked with more than 100 small businesses and it appears that everyone is very appreciative of the work she does. She does not give much advice on her site but I did want to mention it as she seemed a credible person to put together a business plan for a person who does not know how to put one together his or herself.

Resource:

http://www.growthink.com/team/dave-lavinsky

http://www.growthink.com/category/blogs/dave-lavinsky

http://www.growthink.com/businessplan/help-center

http://www.christiekaris.com/

SUPER Twitter!

2011-06-16T06:28:00.000-07:00

Paramount thinks TWITTER is Super!

Super 8 Trailer

Super 8’s brilliant twitter marketing scheme garnered a $37 million opening weekend. Paramount Pictures took to twitter to promote a sneak preview of the new film “Super 8” directed by J.J. Abrams and produced by Steven Spielberg. How it worked is Twitter users needed to tweet with the designated #Super8Secret hashtag in order to get locations of the secret day early premier screenings. In order for Paramount to accomplish this they teamed up with Twitter and “paid to make #Super8Secret a "Promoted Trend," putting the hashtag under the top 10 trends listed on users' Twitter homepages” (Yin). They ran the campaign 11 hours before the screenings and used 325 domestic locations, including all 239 Imax theaters. Paramount found success utilizing social media to gain a buzz for the movie as it is reported that more than 100,000 people saw the secret screenings on Thursday June 9^th.

On Facebook, "Super 8's" most active page tacked on an impressive 66,101 new Likes for a total of 123,280 by the end of Sunday. On Twitter, the film racked up 35,912 tweets. That level of online activity bodes well for the film's chances at the box office in the weeks to come (Contrino).

Paramount also debuted the Super 8 trailer on Twitter, which is another way the company is showing their successful use of social media and marketing to the under 25 year old crowd using their own turf.

For my film review:

‘Super 8’ was amazing and beautiful. What made it so good was that the monster doesn’t even have to be involved in the picture; he actually takes a back seat to the intimate moments between the characters. I haven’t believed this big of a child cast since ‘The Goonies.’ The only problem I had with it was the J.J. Abrams signature lens flare that would sometimes take over the whole screen. It didn’t fit with the tone of the film and would take me out of the moment every time they happened. It worked perfectly with ‘Star Trek’ but I think J.J. needs to pick his moments before it becomes an especially tired effect.

'The Goonies'

'Super 8'

http://www.traileraddict.com/trailer/super-8/trailer

Contrino, P. (2011, June 13). Super 8 Dominates Film Chatter Online. CBS News. Retrieved on June 15, 2011 from http://www.cbsnews.com/8301-504943_162-20070802-10391715.html

Yin, S. (2011, June 11). Twitter’s ‘Super 8’ Promo Grosses $1 Million on Thursday. PC Mag. Retrieved on June 15, 2011 from http://www.pcmag.com/article2/0,2817,2386773,00.asp

Stewart, A. (2011, June 8). Par preps sneak peeks for ‘Super 8’. Daily Variety. Retrieved on June 15, 2011 from http://www.variety.com/article/VR1118038226?refcatid=3762&printerfriendly=true

SURVEY TIME!

2011-06-13T13:11:00.000-07:00

Streaming Services vs. Rental Stores and Questioning Our Future As A Society

2011-06-02T21:38:00.000-07:00

With Blockbuster going bankrupt and the number of subscribers to Netflix constantly rising, it is no question that the population wants their entertainment at their fingertips, on demand, without the hassle of leaving the house and fighting the elements to get it. It is no wonder that many start up companies are jumping on the bandwagon and launching their streaming sites albeit without all the A-list titles that Netflix has. It is an interesting turn of events for the world. The younger generation has a pin drop of a memory of VHS and soon they may have nostalgic feelings towards DVDs. “The future of VOD is a series of channels of content,” Cakarel says. “DVDs will continue their rapid decline as the choice of format for home entertainment. I think we all need to wake up and smell the coffee. My young sister in Istanbul will never buy a DVD in her life. That’s a fact. Period.” (Appelo, 2011).

Hollywood Reporter states, "That there are so many options is a testament to the popularity of streaming, which has become a preferred way to consume movies, according to a March study from PricewaterhouseCoopers. PwC reported that the Netflix model of mailing DVDs is No. 1 with consumers, with 43 percent of Americans doing it, while the subscription streaming service where Netflix also is dominant is No. 2 at 32 percent. Third is a la carte streaming, fourth is renting a DVD from a kiosk, and fifth is renting from a video store."

On a personal note, are we as a society disconnecting ourselves from each other? We all crave a more personal experience but will that in turn shield us from wishing to communicate with others? If we never have to leave the house because entertainment, work, marketing, etc can all come to us, will we? Are all these personalized experiences spoiling us by allowing us to exaggerate our own lives to others that we have forgotten how to listen? By this question I mean the younger generation that is so quick to have everything at a push of a button has not the time to learn the meaning of patience and because they are always talking (on the phone, texting, facebooking, twitter, netflix streaming online parties, etc) are they not learning the valuable lesson of listening. Has this digital age triggered the beginning of society's breakdown?

Appelo, T. & Bond, P. (2011, March 17). How the Assault on Netflix Will Shake Out. The Hollywood Reporter. Retrieved on June 2, 2011 from http://www.hollywoodreporter.com/news/how-assault-netflix-will-shake-168562

Interesting side note: did not realize companies for actually hiring for a purely "digital marketing" designated job. I believed that digital marketing was just in the general marketing mix. Should stop taking things for granted since all these new job creations are jobs my generation can fill.

Fox taps Ira Rubenstein to oversee DM

What Makes An Indie?

2011-05-26T12:44:00.000-07:00

When one hears the term ‘independent film’ it usually conjures up images of skeleton (minimal) crews, low budgets and novice actors on their way to the big time. After Miramax turned small independent films into household names the term started to lose its meaning. What I mean to say is independent films now come to mean A-list actors, A-list directors, A-list crew, modest budget and most importantly – an art house feel. Art house meaning garnered toward a smarter breed of audience. These movies are now Oscar contenders and usually the winners making them a draw for talent. So with all the positives an independent film has, when does it stop being independent? Are the true indie filmmakers scared that their content is not going to be seen or heard now that big budget films are calling themselves ‘indie’ because they offer a quirky storyline with bohemian beliefs? A current article in the Daily Variety informs on the issue that studios now consider their independent films the big money makers. One quote says that while some of 2010’s indie films “did no where near the $120 million gross of Fahrenheit 9/11… they were to tip grossing 2010 films for their distributors.” (Goldstein). Since when do studio and independent mean the same thing? The upside is that with these evolvements we are seeing that there is a thirst for smart films and not just the fun blockbusters that sometimes take over the multiplexes. But one has to wonder, how can I push through to the big time if the studios continue to masquerade as small independents and not need the content provided by the genuine independents?

Goldstein, G (2011, May 23-29). Daily Variety. Indies Splash Into Summer, Niche distribs adopt bolder counterprogramming moves

Everyone vs. Copyright Theft

2011-05-26T12:21:00.000-07:00

The Motion Pictures Association has a new president in Mr. Christopher Dodd. He is actively joining forces with the Senate in passing a bill to curb online piracy. Piracy is where people access copyrighted downloadable content without paying the proper people for that content. It is big business in the States and even bigger overseas. Some people have cited that the amount of piracy overseas is the real problem as they are two thirds of the problem and the people in power should focus their efforts on chocking off their access in order to rein in the problem. The bill in question is called the Preventing Real Online Threats of Economic Creativity and Theft of Intellectual Property Act or PROTECT IP Act. If passed, “it would authorize the Justice Department to seek a court order directing third-parties – search engines, payment processors, advertising networks and Internet providers – to cease providing transactions and support to overseas sites engaged in online infringement.” (Johnson). This would be a great blow to the system, however that it violate search engines is still a questionable topic. Search engines work off of code to recognize key words and deliver what a person is actively searching. If they were to find these sites and delete them from becoming available in their searches, many believe it would start to slow the access to downloading. Dodd was quoted in Cannes saying, “The big issue for us is thievery. I hate the word ‘piracy’ because it conjures up these lovable characters. Theft of intellectual property is the dominant issue.”(McNary).” The MPAA may be an organization that people don’t agree with most of the time but at least this time they are fighting for the protection of content and not judging the ability of it to be shown. This new president may bring a bit of fresh air to the organization.

Johnson, T. (2011, May 13). Daily Variety. The War On Websites, New bills aim to curb online piracy.

McNary, D. (2001, May 17). Daily Variety. Dodd Digs In At Fest, New MPAA chief talk copyright theft.

Entertainment Law

2011-04-20T00:15:00.000-07:00

For this month’s blog I wish to share about the importance of intellectual property as it pertains to the entertainment industry. I had wished to interview a prominent lawyer in the field but sadly he was too busy preparing for Cannes and finalizing issues with his current clients before his four-week trip to the French Riviera. By the time I obtained this information, it was too late for me personally, (with one week till the due date) that I would wish to ask someone to take time out for me.

So instead of an engaging interview, I am reviewing a couple of podcasts. The first is from Gordon P. Firemark, Esq. his 12^th episode of his Entertainment Law Update Podcasts from iTunesU. His personal website can be found at http://firemark.com/.

One piece of news he talked about was that the copyright office issued a letter that supports the idea of a performance royalty for terrestrial radio stations to pay. An act is pending in congress which would require that there would be a performance right in broadcast radio. Terrestrial radio argues that if it is burdened with another fee that it will be put out of business, as they do not earn money by subscribers such as satellite radio. The fee could not be passed on to the listeners, as that would cause uproar with every listener fighting for their free terrestrial radio. A guest Firemark has on the show states that the fee is so nominal that it makes terrestrial radio companies argument invalid and that musicians are running out of ways to make money on their craft and this could be a new legal stream opening up.

He also talked about an interesting dispute between Michael Douglas and his ex wife Diandra who has filed a suit claiming an interest in his earning from Wall Street 2. As part of the divorce decree she would receive any money on any spinoffs based on movies from when they were together, however spinoff is not a legal term and the courts will have a hard time deciding this one. Could spinoff mean a derivation, a sequel, etc? How interesting is it that ONE word can make or break the meaning behind a contract? Spinoff usually means when one character from an original TV series breaks off on his or her own and makes a completely new series. This seems to be improper wording on Diandra’s lawyer’s part, as Michael Douglas is a film actor and not a TV actor. Yet Diandra could make the case that the character of Gordon Gecko is the only character that remains the same in this new film, which could make it a spinoff of sorts as opposed to a sequel that usually retains its original cast. This case will be interesting to see who comes out on top.

I’ll move on to a separate podcast by Georgetown University’s law center. It’s from their first Sports and Entertainment Law Symposium and Launch of GEMALaw. One lawyer talks about her experiences of how she got to where she is. Her most important piece of advice is that law students should pay attention to the business side of the industry they are in and not solely focus on the law. She divulges further by explaining that what makes a lawyer particularly effective in the entertainment industry is that they know the business that their clients are in and are abreast of all news and issues affecting those industries. I believe that even if you are not a student of law you should take this advice to heart. To succeed in any industry you should know the ins and outs of the business you are involved in as well as the business the people you work with are involved. In that way you can relate to those people better, build that trust since they will feel that you understand them, and grow a stronger business.

Thanks for reading!

Industry Liabilities

2011-03-31T10:07:00.000-07:00

Lamensdorf vs. NYC, et Others

One recent case that is making it’s way to court is centering around the death of an NYU student on a student thesis film set in Georgia, USA. This case will have the biggest direct impact on my business plan as it deals with the danger of the unseen accident on a film set. The case centers around film students from New York University that wanted to shoot on a very remote location in Georgia. The location being so remote that for the night shoots the only lights available during set up where from the floodlights of their cars, without them it would be pitch black. This inability to see created the dark look the director and cinematographer wanted yet left every available opportunity for accident offset where the lights would not be shining. In the darkness the gaffer, who was on a lift with a 12k light, was being instructed by the cinematographer where he want the light positioned in the total darkness. The lift struck a power line no one saw and sparks flew from the 12k, which exploded, all the way down the electrical lines on the set until it reached a student named John Lamensdorf who was positioning another light on the opposite side of the set. Lamensdorf died at the scene. What I’ve failed to mention previously is that the shooting location was in a couple miles radius of “dead zone” for cell phones. In order to place a call one must drive out of this dead zone. When Lamensdorf fell dead, one had to do this in order to call 911 and then had to wait the couple hours it took for them to get to the location. On the outside looking in, we can find it irresponsible for the students to have picked such a location, without notifying authorities of their presence and without having EMT’s on location for safety. These reasons are why Lamensdorf’s parents are suing the university, the students involved on the set and outside hires involved in the shooting in Georgia. Most importantly for my business plan, their suit outlines many safety precautions I have to include to make sure I am not making myself openly liable for a negligence or wrongful death suit.

Thrasher, S. (2010, April 6). NYU’s Snuff Film.The Village Voice.Retrieved on March 30, 2011, from http://www.villagevoice.com/2010-04-06/news/nyu-s-snuff-film/

FILMS CORP v. MGM UA HOME VIDEO INC MGM UA

Another case is from the United States Court of Appeals, Second Circuit.

Film Corp asked for an appeal on the ruling that denied that the motion picture, “King of Kings” distribution company, MGM, had to cease the distribution of the film based on the expiration of the original copyright that granted them exclusive distribution rights filed jointly by both parties. MGM agreed to finance and distribute the film if they owned the rights in perpetuity, which means forever. They state that they never would have agreed to the terms in the first place if they didn’t not have rights to the copyright in perpetuity. The outcome was that the court agreed with the original ruling of the district court, which ruled in MGM’s favor. This is important in my business plan as it teaches me to have explicit details when it comes to copyright rights, distributions rights, promotion rights, film rights, etc. Without these listed in detail I may end up in court and could lose the rights to the film I founded and brought to the table to make a motion picture.

P.C. FILMS CORP., Plaintiff-Counter-Defendant-Appellant, v. MGM/UA HOME VIDEO INC., MGM/UA Communications Co., Warner Home Video, Inc., Turner Entertainment Co., Defendants-Counter-Claimants-Appellees.

No. 97-7399.

Argued Sept. 26, 1997. -- February 23, 1998

Retrieved on March 30, 2011 from http://caselaw.findlaw.com/us-2nd-circuit/1420592.html

UNIVERSAL STUDIOS INC v. VIACOM INC

The final case I wish to discuss happens in the Court of Chancery of Delaware, New Castle County.

UNIVERSAL STUDIOS INC., a Delaware corporation, and Universal City Studios Inc., Plaintiffs, v. VIACOM INC., a Delaware corporation, Viacom International, Inc. (successor by merger to Paramount Communications Inc.), a Delaware corporation, and Eighth Century Corporation, a Delaware corporation, Defendants.

VIACOM INC. and Eighth Century Corporation, Plaintiffs, v. The SEAGRAM COMPANY LTD., Universal Studios Inc. and Universal City Studios Inc. Defendants.

Civil Action Nos. 14971, 14973. May 15, 1997

Retrieved from http://caselaw.findlaw.com/de-court-of-chancery/1271767.html

An Exciting and Informative Interview with Patricia Cusick

2011-03-20T11:50:00.000-07:00

I was very lucky to have the opportunity to interview Ms. Pat Cusick who was a high level executive for Xerox. She is a very interesting woman who paved the way in her field not just for other women but for everyone in her field. Following is an excerpt from our interview where she tells intriguing stories about a couple of memorable negotiations. After the interview are a few pieces of advice she would like to give to students venturing out into their own negotiations in the corporate world.

Patricia Cusick -- experiences as:

Account Development Director, IBM Corporation

Corporate Vice-President & CIO, Xerox Corporation

CASE I.

One question is how you separated the person from the problem in a particular negotiation. Did you have to meet with someone you didn't particularly like in order to achieve a benefit for the company and had to put aside your feelings in order to negotiate effectively without affecting the deal? What was the negotiation about? How did you put aside your emotions? What was the outcome of the deal? Do you feel it was mutually beneficial?

“Although I had many situations negotiating with someone I didn’t particularly like, one stands out in my mind. My adversary was someone I intensely disliked…a self-interested, arrogant executive with less operational experience than me, but with some strong corporate sponsorship. We had several past dealings with each other which, while trying, mostly resulted to my advantage. We met again when our organizations were to merge and we were to negotiate the terms. My objective was to protect as much of my groups’ management team and structure as possible to provide service to our organization.

I knew my emotions could get in the way of our discussions. I scheduled set periods of time for our meetings to limit the interaction at any one time. I knew it would end in “x” minutes, so I could go to next steps & wrap-up if I got upset. I over-prepared so that I could take refuge in facts if things got heated. I came prepared to compromise on some items so that we could move on when we got stuck. I kept focus on my desired outcome and what it meant to my organization – the “big picture” versus my desire to win points. And I tried many calming techniques – especially the “2 second rule”, pausing 2 seconds to collect yourself before you speak in anger …often to no avail!

I was successful in a few areas, but lost many more. I don’t feel it was due to my losing negotiations, but more so because of behind-the-scenes corporate politics. My adversary had portrayed me as unwilling to cooperate and blocking the merger. I was instructed to cede several items in order to protect the overall deal. The outcome was substantially to my detriment.

I don’t know if this situation could have ended any differently given the personalities involved. The lesson I learned was that being factually prepared isn’t always enough. I should have known more about the corporate goals & the power bases I was dealing with. I could have lined up better defenses in advance.

By the way….all decisions that I lost in this negotiation were reversed over the next few years after they proved unworkable…& the corporate sponsors had changed!”

CASE II:

In a different negotiation how did you use your status as leverage to get what you wanted? Did you find being a woman in your field/position helped or hindered your negotiations? What was that one about? What was the outcome?

“For almost my entire corporate career I was the only woman involved in many high-level negotiations. It was a mixed scenario. I would say that, as a woman entering into these situations, I was usually underestimated and usually successful at the outcome. Initially, being the only woman was a disadvantage. I was often ignored. But it gave me the opportunity to lay back a bit and more fully judge the personalities & the objectives in the room. Many times, the “macho’ behavior was checked a bit because I was present. I sometimes overplayed my feminine style – politeness & consideration (always good traits!). That would allow me to make my points more effectively. I was patient, but persistent! I was tough, but fair. And, since I knew what I would be dealing with as the only woman involved – I was usually the best prepared in any negotiation I would enter. That always proved to be my advantage. And by the time I was a corporate officer, my status commanded attention & respect. I used it sparingly…but it was effective when I did.

One particular incident revolved around a promotion I was competing for. I got the job over several of my male peers. The executive I would report to told me I had been selected – to my delight. He then told me I would go into the role on a “trial basis” with no change in job grade or pay because he had to be sensitive to the men who did not get the job. What ensued was me swallowing my anger and asserting my position as the selected candidate…and the only woman at the level competing for the job. Any male selected would have been promoted without hesitation. I suggested that the potential for a discrimination charge was obvious and would have been embarrassing and distasteful to both of us. It became a “play me or trade me” kind of discussion. I was prepared to transfer rather than accept the job as offered. I got my full promotion.

I learned not to be afraid to ask for what you want, make your arguments and be ready to take alternative action if your negotiating tactics fail.”

CASE III :

Did you ever use any dirty tricks/tactics for your benefit in a different negotiation? Did you recognize when someone used them on you? Did you recognize them early and used those to benefit you or too late after the deal was done? What was that one about? What was the outcome?

“I was responsible to negotiate a deal worth tens of millions of dollars in revenue to my company. I was dealing with a no-nonsense customer looking to get the lowest costs possible for their company. They were an experienced team with a history of pressuring suppliers to get what they wanted. When I held my ground on some areas of pricing, they calmly said “no deal” and walked out of the room. I thought both companies wanted to make a deal and the mechanics would work out eventually. The abruptness of walking out shocked me and taught me a lesson at the same time. We found our way back to the negotiating table after higher level executive appeals, and closed a deal with more concessions than I intended. It was a tactic that worked and I never forgot the lesson.

Many years later I was negotiating a way out of a legal action, which revolved around an alleged breach of contract due to my company’s cancellation of services from a supplier. After discovering that the other party’s concern was really their loss of revenue, I moved the negotiation to extending our contract and replacing cancelled services with a prolonged revenue stream worth more money over time. This would be a win-win scenario for both companies, avoiding a costly legal action for us and providing desired revenue to them. As negotiations of the new deal unfolded we reached a point where we stalemated. When we exhausted what I thought were all reasonable attempts to compromise, I calmly stated my disappointment and that I would see them in court and walked out of the room. That abruptness had the same effect on my adversary as it had with me in the other situation many years before. After they had their higher level executive conferences, they called me back to the negotiating table and we were able to close a mutually beneficial deal.

This was an aggressive tactic and had to be used only when absolutely necessary, but it worked. I don’t know what would have happened if they called my bluff since we did not want to go to court! But I learned not to be afraid to walk away from a deal if it requires concessions you are not willing to make.”

SOME ADVICE from her EXPERIENCE:

· Be prepared, do your homework!

· Understand both sides’ objectives

· Constantly assess the situation – Listen, Listen, Listen!

· Be professional and polite

· Be patient but persistent

· Be firm but fair

· Don’t be afraid to ask for what you want

· Anticipate negotiating scenarios

· Ask high but know your bottom line

· Don’t compromise without reciprocity

· Always have options including a fall-back position

· Be assertive not aggressive

· Be willing to walk away

Bring Film Work Back to the United States!

2011-02-20T16:53:00.000-08:00

It’s strange to think how much United States exports; even the film industry has always found a cheaper home outside American territory. With so many people looking for work along with the beautiful terrain which allows so many different shooting styles our country offers us it is strange to think we don’t take advantage of these things and use it to pump dollars back into the economy. For those that aren’t familiar production companies choose to shoot where they can find the higher tax incentive, that is, the money they receive back if they meet the minimum requirement of that location for expenditures, crews, equipment, etc. Many ask, “Why travel so far to shoot a movie, wouldn’t that cost more?” The answer is no if they find the right location with the right tax rebate and utilize locals for the cheaper cost which benefits both parties; the producer spends less to make the film and local crews get work which pumps the dollar back into that particular state’s economy. So why wouldn’t more states jump on the bandwagon? The reason isn’t so clear. What is clear is that Canada seems to be raking all the benefits for US productions.

“Ontario’s film and TV sector racked up $964.3 million in overall production activity in 2010, up from a year-earlier $946.4 million and $671.2 million spent locally in 2008 when Hollywood studios pulled back amid the 2008-09 market meltdown. British Columbia continues to attract the bulk of foreign location shooting and service work nationwide, with Hollywood production in and around Vancouver last year clocking in at $485 million, up sharply from $248 million in 2009.”

How can US state governments not want a piece of this lucrative pie? Maybe they are not seeing these numbers and don’t realize what a great Film incentive can do for their state. I urge any readers to petition their governments for film incentives to bring the US film industry back to the United States!

Vlessing, Eaton. (18 February 2011). U.S. Tax Credit Chill Sends Hollywood To Canada.

Hollywood Reporter. Retrieved from http://www.hollywoodreporter.com/news/us-tax-credit-chill-sends-101503

Interesting Articles for the 1st week of February

2011-02-05T17:01:00.000-08:00

   I read a couple of interesting articles this week, the first of which is about the American Humane Association taking legal action against the Oscar nominated film, "The King's Speech."
What I always took as a free phrase at the end of films or as one to ensure safety on set is actually trademarked. In order to use the phrase NO ANIMALS WERE HARMED® you have to have work with the AHA. This was interesting to read because I had no realization of this fact. Neither did producer Emile Sherman who just wanted to ensure the public that every safety precaution was taken to make sure the animals were not harmed. To further this fact he released a statement verifying that he is a director of an animal protection agency called Voiceless. So as a warning to future producers, always make sure that you are not using a trademarked phrase and are going by the books so as to avoid a costly lawsuit.

http://www.hollywoodreporter.com/blogs/thr-esq/kings-speech-threatened-legal-action-96849
Image Courtesy of http://www.americanhumane.org/

   Another article I read is called, "Hulu Pays at Least $40 Million to Get John Stewart Back." This was an interesting read because the article talks about how Hulu CEO Jason Kilar's head may be getting to big for his trousers. In a blog post where he announces "The Daily Show" content will return to Hulu he also made insinuations that his business model may be better than that of ABC, NBC, and Viacom. While he may be correct he should not be making claims about a business model that is directly affected by the content that is given to him by those major media corporations. He also claims that his 2011 year could be the most profitable year ever giving his shareholders a number of $500 million to salivate for by the year's end.

http://www.hollywoodreporter.com/news/hulu-pays-40-million-jon-96361
http://www.hulu.com/
http://blog.hulu.com/

   The final article for this week is titled, "Sony Profit Declines 8.6% in Latest Quarter." It states that for the 2011 year, "Sony recorded a quarterly profit of $893 million. Operating profit fell 5.9 percent to $1.70 billion. Revenue came in 1.4 percent lower at $27.24 billion, or 2.2 trillion yen. However, in local currency terms, revenue grew 6 percent as the yen had appreciated 8.7 percent against the dollar and 18.5 percent against the euro over the year-ago period." Companies across the board are experiencing huge hits in their home entertainment division as DVD sales have continued to drop. There is no exception for Sony however they have succeeded in other divisions. Their video game market has continued to hold a strong profit for five years as well as the sale of their Playstations. They've seen a drop in their LCD TV's as well but only because of the drop in prices with the release of 3d TV technology. What is good about Sony is that, "Kato said Sony was taking a “conservative” view and not raising its overall full-year operating profit forecast." This is good because they may see a good 2011 profit year since they are keeping their profit forecast down. This conservative approach may help Sony in the end.

http://www.hollywoodreporter.com/news/sony-profit-declines-86-latest-96215
http://www.sony.com/index.php

Art Directors Guild

2011-01-30T14:40:00.000-08:00

"Production Designers are artists who adapt their style to all types of films. The scope of their talent is limitless. Their imaginations soar within a practical and economic framework. They make seemingly impossible things possible for filming, all the while under the pressures of money and time."

The Art Directors Guild is a branch off of the IATSE, the International Alliance of Theatrical and Stage Employees. This organization is one I strive to become a part of but membership is not an easy one to attain. It was interesting to read that in 1924, sixty-four of the men and women behind the set designs decided to get together to discuss the business and inform each other of new and creative designs in their trade. In the 1930's Art Directors were given little to zero credit for their major contributions to the film industry. It wasn't until the grand production of Gone With the Wind and the amazing sets behind it and the storyboards that went scene by scene that people started to give credit to the hard work designers do. After WWII the Guild aligned with IATSE and become a strong and powerful guild, one that every art director aspires to a part of much like Directors wish to be in the DGA.

To be granted entrance into the Art Directors Guild you must do the below which was taken from the website:

Eligibility for application and admission into Local 800 as an Art Director or Assistant Art Director is typically triggered by working for a signatory company in a Local 800 covered classification. Thirty calendar days from the start date the employee is required to join Local 800. And there are four typical scenarios:

a. When a project starts out non-union then signs an IA agreement; that is, it's organized." Employees working in a Local 800 covered classification when the project is organized are "grandfathered" into the union. Please contact the Guild's Membership Department.

b. Employees also become eligible when they work on signatory commercials and music videos.

c. If a signatory company not covered by b), above (say one doing a television show or feature film), wants to hire an Art Director or Assistant Art Director, and the individual is not on the Industry Experience Roster, the company may petition the Local to do so under the applicable Off-Roster sideletter to the Local 800 Basic Agreement. If the petition is granted by the Off-Roster Hiring Review Committee, the individual may be hired and is eligible for admission into the Union.

d. If the individual in c), above, is already on the Roster at the time he/she is hired by the signatory company (see below), the company doesn't require the Guild's permission for that hire, and the individual is eligible for admission into the Union and is required to join after thirty calendar days.

Once in the guild you receive the following benefits also taken from the website:

Workplace grievances resolved by union
- Guaranteed prominent placement of screen credit
- Training and education (seminars, symposia, etc.)
- Access to employment information
- Annual ADG Membership Directory and semi-monthly newsletter
- Annual Awards Banquet
- Film Society screenings

Being a production designer I am working towards the qualifications of membership. The rewards behind the membership are great and incredibly appealing.

Art Directors Guild website
http://www.adg.org/

Business Storytelling with Ted

2011-01-30T13:48:00.000-08:00

"He tells me film can change the world. He tells me you can build companies based on trust. He speaks softly."

Stephen Gaghan in Time
Jeff Skoll was the first President of Ebay and left the company to find a way to promote positive change in the world. He discovered that the way he can reach the most people is through the medium of film. In the video he talks of his move from Silicon Valley to Los Angeles and that he felt as if he may be laughed out of town with his talks of creating a production company geared around social change and the promotion of different groups that make a difference in the world. He also makes a joke that the fastest way to become a millionaire is to start out as a billionaire then move to Los Angeles and make movies, which I found to be a clever joke.

What I find to be particularly amazing about his story is that with success the company is still committed to change. Sometimes we find that success changes a companies values and mission in Hollywood and find that putting out movies for strictly entertainment purposes actually make more money than those that are attempting to affect people in a certain way that causes them attach themselves to a particular purpose. If you go to the company's website, http://www.participantmedia.com/index.php, you'll find that on the right side of each film they have produced and are promoting you'll find the "make a difference" panel where they list at least three different ways and links to get involved with a particular movement associated with the film. That is an amazing commitment to promoting what they believe in as they are not only showing what they have created but the inspiration behind it and how the consumer can get involved.

Jeff Skoll is an inspiration to me as he has proven that you can stay true to who you are, promote change, and create films with meaning and be a success. I dream that I may be a billionaire turned millionaire so I can form a production company with similar values.

His Ted Video
http://www.ted.com/talks/jeff_skoll_makes_movies_that_make_change.html

His Bio
http://www.ted.com/speakers/jeff_skoll.html

Get Involved!
http://www.takepart.com/