Before we get to the future, let us pause a moment to bid farewell to our friends, companions, and erstwhile overlords for the past three years, who now pass out of our lives. Let’s take a moment of silence for the executives of the American Telephone and Telegraph Company, formerly Southwestern Bell, who will soon exit stage right, never to be heard from again.
Yesterday, they were the champions of entertainment, the brave innovators leading us into the future, whom we angled for a fleeting moment in their halo, outside a premiere, at an afterparty, or on the valet line.
Today, as it is with all mortal things, they return to the earth; their calls never more to be returned; their lines on invitation lists deleted.
Let us bow our heads to remember all those brave companies that came before them to our shores, arriving hale and hearty and full of Tinseltown dreams. Coming in like a lion to show us all how it’s done, and leaving—some mid-single-digit number of years later—broken, vanquished, spirits rent asunder, wallets tens of billions lighter. They caught the last train from the coast and fled as fast as they could.
We speak your names: Vivendi, Seagram’s, Coca-Cola, Gulf and Western, Decca, Matsushita, General Electric, The General Tire and Rubber Company.
Now AT&T is forever remembered among these great interlopers who funded so much of our lifestyle in their time.
They came talking of how a modern beverage, oil, or telephone company had to have a film studio to survive—and left under the cover of darkness. We honor your contributions. Your calls may be declined, but your memory lives forever.
Of them all, the News Corporation and Rupert Murdoch still stand alone as the only company that has beaten the house here in Hollywood.
With our head bowed in respect, onto the business at hand.
• ATT Phone Home
Back a year and a half ago, I predicted a few times that the PowerPoint-driven launch of HBO Max would be studied for decades to come as a historic business fiasco. It turns out that I was thinking too narrowly: The Max launch was just one small piece of the wholesale, top-to-bottom, historic business fiasco of The Telephone People’s Hollywood Adventure.
You’d like to think that people running giant multinational corporations, employing hundreds of thousands of people, know something about their own business, that they aren’t just making it up.
But by what law of business did they think that you can come to Hollywood and get any results in just three years? Why come to a business that’s about tolerance of failure if three years is all the non-success you can handle?
John Stankey explained Monday: AT&T needed to focus more intently on its U.S. telecommunications business. So it turns out the phone company needs to focus on phones. Who could’ve known?
Lord Stankey himself seemed determined to learn as he ruled: in a swirl of incomprehensible MBA jibberish. “It became clear to me we were going to need a different capital structure,” he explained. Oh well, as long as it wasn’t the movies or the shows, or the people who were and weren’t watching them. Mom and dad just need a different capital structure. It happens to the best of companies!
His farewell memo was a touching tribute to the role entertainment plays in the lives of individuals and moves them to commune with their better selves. He wrote to his employees:
The complementary nature of this combination of companies is critical. It allows for two important things. In our core linear business, a combined offering of programming will stretch across the most powerful advertising demographics and will strengthen the combined company’s value proposition in fast evolving markets. Further, the programming line-up broadens our audience and will deliver more value to our distribution partners. In our direct-to-consumer efforts, we add an important and popular content genre, coupled with the strengthening of our upcoming effort to scale internationally.
(Author pauses to brush away a tear and choke back a sob.)
To think of the ungrateful public that didn’t rush to embrace such a beautiful vision.
“I will admit that I am personally disappointed and sad that I will not have the opportunity to continue this journey with you, but I am incredibly optimistic and enthusiastic about the future of the combined WarnerMedia and Discovery.”
What a sad day it must be. With a little more time, how many more divisions might The Telephonies have turned upside down? Not a word, though, on how much he has done to distract these companies from the work of making entertainment; how many more divisions, brands, and reputations could’ve been ruined; how many people were displaced, before the capital structure was no longer right.
• Jaw Dropper of the Week: “If the transaction moves forward, AT&T Chief Executive John Stankey will have unwound the two biggest deals done by his predecessor, Randall Stephenson, in his 10 months in charge. Earlier this year the company reached a deal with private equity firm TPG to shed a 30% stake in its DirecTV business for $1.8 billion. AT&T had acquired DirecTV in 2015 for $49 billion.” WSJ
Darn that Randall Stevenson! Not only making them come to Hollywood, but then making them arrogantly mismanage their companies once they got there. And he can stay out!
Easy to blame the guy who’s not there anymore, but let’s not forget that Lord Stankey Himself, just happened, in his former life way back a year ago, to hold the job of architect and executor of this policy. And it wasn’t just a bad idea; it was a poorly thought-out idea, terribly executed.
But let us also pause a moment to remember the arrogance with which this company came in and did enormous damage to a hundred-year-old studio. Starting with: They inherited the single strongest brand in all of television in HBO and made it their top priority to undermine and dismantle that. This all set the tone of talking about entertainment as though it were a business school exercise to put the blocks and pieces in the right place, guided by “data,” after which creativity would just fall in line.
From there it was no big deal to dismantle the theatrical system, seemingly on a whim, with no involvement from the creative community, and execute endless re-orgs and reshuffles with the seeming purpose of putting people with less and less experience in creating entertainment in ever-higher levels of authority – replacing the complacent Boomer elite with a complacent tech fanboy elite; demonstrating their deft touch with talent but sitting back for a year while a star led a campaign against what should be the most important unit of the entire empire, with seemingly nothing to say about that.
Just some of the hits! Such sadness that the journey won’t continue on . . . .
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