Kevin Tsujihara's Ax Falls Hard at Warner Bros. (Analysis)

5:00 AM PST 06/26/2013 by Kim Masters
Kevin Tsujihara

Film chief Jeff Robinov follows TV head Bruce Rosenblum out the door as a film trio takes over and an analyst warns, "One of the three will eventually drive the other two out."

This story first appeared in the July 19 issue of The Hollywood Reporter magazine.

How many calls can Kevin Tsujihara return each day? The new Warner Bros. CEO has no fewer than 17 executives reporting directly to him now that film chief Jeff Robinov has joined TV head Bruce Rosenblum in exiting Hollywood's most prolific studio. The shuffle has led to one of the most abrupt and profound cultural shifts ever witnessed at a studio and has left many Warners veterans and observers with a sense of shock and disorientation.

Tsujihara's direct reports are not significantly greater in number than those of outgoing chairman Barry Meyer, but in both film and television, there now are committees of top executives in place of an empowered division leader. That leaves Tsujihara -- the former home entertainment head who lacks experience making movies or television shows -- with far more authority and responsibility in both areas. "Kevin's an extraordinarily bright man, but he may be spreading himself awfully thin," says one top insider.

This arrangement does not sit particularly well with Wall Street, where analysts are skeptical of management by committee. "It's better to hire or pick one great executive who can integrate it all," says Hal Vogel of Vogel Capital Management. "Three or four people means three or four different agendas." Many industry observers and former company execs expect the structure to work better on the television side -- where Peter Roth stands out as the proven creative talent -- than on the film side, where many more questions about leadership arise. "Instead of it being a new administration, they're putting themselves on the spot," says a former studio insider. "What's your playbook? What are your priorities?"

PHOTOS: Warner Bros. Gift to Smithsonian

The film structure revealed June 24 includes Sue Kroll, president of worldwide marketing and international distribution; Greg Silverman, president of creative development and worldwide production; and Toby Emmerich, president and COO of New Line Cinema. Emmerich will add oversight of Warner Bros. Theatre Ventures. Domestic distribution head Dan Fellman has renewed his contract -- though the studio won't say for how long -- and also will directly report to Tsujihara until Fellman retires, when international distribution chief Veronika Kwan Vandenberg will assume his responsibilities. For now, she reports to Kroll.

Warners long has had a greenlight committee of which Tsujihara was a member along with Kroll, Fellman and others. But Robinov was the clear leader and had authority to put films into production, as did former studio president Alan Horn before he was pushed out in 2011. Meyer did not pick movies.

But observers surmise Tsujihara, by virtue of his position, now will wield clout in that area. Even if he is deferential to the greenlight committee, one Warners veteran wonders, "Who has a track record that says they know what they'd be doing?" Even top insiders acknowledge the studio will go through a patch when outsiders -- talent and their reps -- will be unclear how the system works.

Still, a producer with ties to Warners says the arrangement could work in the long run: "This allows each of them to show what they can do, while allowing Kevin to gain a greater understanding of the entire area."

That's if everyone gets along. "Is it possible these guys have set in place the very same kind of bake-off that they just finished with?" asks another Warners veteran. "It's almost as if they're now saying to Greg and Sue and Toby, 'One of you is going to end up with the Robinov job.' " Adds Vogel, "Unless the roles and responsibilities are very clearly defined, there will be continual jockeying for position, and one of the three will eventually dominate and drive the other two out."

Despite the risk, a producer with significant business at the studio says he sees this outcome as the best option for now.

"The Jeff situation was untenable," he says. "Jeff's autocratic approach, where he essentially ran his own personal production company focusing on his favorites, suffocated contrarian points of view and any other execs with a good idea. This 'flatter' approach, if it allows their talented bench to breathe oxygen, could be really dynamic."

STORY: Warner Bros.' Kevin Tsujihara on Studio Plans, Digital Critics and Lunch With Clint Eastwood

The shake-up comes at a key time for Warner Bros. and Tsujihara, 48. The studio's relationship with financier Legendary Pictures is expiring at year's end, and sources tell THR that Legendary CEO Thomas Tull -- now working with Rosenblum -- will not re-up. (Universal is his most likely home.) Instead, Warners is seeking a rich slate financing deal to supplement its $1 billion-plus pact with Village Roadshow, which runs until 2017.

Meanwhile, as Robinov mulls his limited options -- sources suggest there could be a role for him at Fox or even Sony -- the consensus among insiders is that the new Warner Bros. arrangement, instigated by Time Warner CEO Jeff Bewkes, has put Tsujihara in a difficult position. "He's not looking good from this, but I don't personally fault him," says one. "I think this is a mess. Kevin's out there, visible and vulnerable."

And a Warners hand observes that running the studio involves a panoply of tasks beside overseeing film and television, including "the external relationships, government issues, parent-company issues and talent issues, since they always want to speak to the top guy." This person asks, "How are there that many hours in the day?"

Email: Kim.Masters@thr.com

Twitter: @KimMasters

comments powered by Disqus