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WarnerMedia CEO Jason Kilar is making his mark on the entertainment giant after just three months on the job.
The executive surprised Hollywood on Friday afternoon when he announced a comprehensive reorganization that included the departure of WarnerMedia Entertainment chairman Bob Greenblatt, who’d held that post for just under a year-and-a-half.
The shakeup, which Kilar described in a memo to staff as “smart and bold risks” consolidates WarnerMedia’s otherwise unwieldy content divisions into one unit that will be overseen by Warner Bros. chief Ann Sarnoff, a significant promotion for the BBC Worldwide North America executive who has been at the company since last summer. And, in a move that will consolidate programming decision making under one roof, HBO veteran Casey Bloys will report to Sarnoff and oversee a content team that encompasses the premium cable network, streamer HBO Max and a trio of basic cable channels.
In an interview with The Hollywood Reporter, Kilar says the purpose of the reorganization was to prioritize three pieces of the WarnerMedia business: its consumer-facing operations, its direct-to-consumer brands and global growth. The former indicates that WarnerMedia will direct its studios to operate less as content wholesalers and more as pipelines to its networks, particularly two-month-old HBO Max, but Kilar maintains that the company is “going to continue to lean into theatrical exhibition.”
WarnerMedia’s previous structure complicated the TV pitch process, forcing creatives to take meetings at both HBO and HBO Max, which at times didn’t appear to be communicating with each other about their interest in a project. “It became pretty clear that we needed to have one content organization,” Kilar concedes. But the new structure could also cause confusion for sellers about just where their project will land. Warner executives say it’s unlikely that a project would end up in a home that it wasn’t originally intended to be in, but that in some instances creators might need to decide on a less coveted home if they want to see their film or TV show get made.
Kilar also addressed Greenblatt’s departure, plans for layoffs and Ellen DeGeneres’ future at the company.
A company doesn’t make these kinds of changes unless something isn’t working. So what wasn’t working and why is this new structure the right fix?
Let me push back on that. It’s not just about WarnerMedia, I’d argue it’s about the media in general. If you look at the history of media companies, WarnerMedia included, they have largely for the last hundred years been wholesale oriented companies — they produced amazing stories and they have historically and even up to today have been organized in a way that hands those stories over to someone else who then takes them to market. So what these changes are largely about is me feeling very strongly that where a media company should go in terms of the future is to orient themselves as a consumer oriented company. These changes represent prioritizing three different things. Number one, a consumer orientation far more than a wholesale orientation. Number two, going direct-to-consumer. And number three, going global. This isn’t to suggest that WarnerMedia doesn’t have a lot of revenue outside of the U.S., we do. But when I talk about going global, I mean having ultimately 70 percent or more of the company’s revenue be accounted for outside the U.S., which is different than most media companies today. By the way, the internet is what makes that possible.
The reorganization seems to prioritize HBO Max. Will it also address the confusion that existed in the market around how to pitch projects to both HBO and HBO Max?
That’s one of the reasons for the changes. The move to a single content organization led by Ann is going to solve for those things. It became pretty clear that we needed to have one content organization to make it easier for us to make decisions to greenlight the best possible stories that we can then take increasingly direct to consumers. I don’t want to minimize our motion picture business, which of course is going to continue to lean into theatrical exhibition, as it should.
What is the position now at Warners regarding protecting theatrical windows?
I think about most things, including this topic, from a perspective of a consumer. I believe that there are a lot of consumers today, and 20 years from now, who are going to love the idea of going out with their partner to go and see a great story in a communal environment. With that said, do I think that things will change in terms of how long the theatrical window is versus where it is today? I do think it will change, and I think that’s appropriate. The key in navigating that change is to figure out a way that it can be done such that the theatrical experience still is a good business. I certainly don’t see the theatrical business going away because it’s a great consumer experience.
Do you think 17 days is too short?
At the end of the day, the customer gets to decide that. We’ll see how that plays out.
Will Warners make a deal like NBCUniversal made with AMC?
Our discussions and our decision making, both internally and with partners, those are things that we keep to ourselves.
Ann is still relatively new in her role at Warners. Why was she the right person for this expanded role?
Ann is incredibly strategic and thoughtful. She sees the macro and she thinks about things beyond the 120-minute story. She thinks about worlds and franchises and how these things can play and in omnimedia world. And she’s a selfless leader. She prioritizes WarnerMedia above all else.
And what’s behind Bob’s departure from the company?
I had to make a very difficult decision once we got to the conclusion of having one content organization rather than two. What made it so hard is that Bob is incredibly gifted. When I think about the last few months, it’s fair to say that Bob and I have had more email conversations and video call conversations than any other executive at WarnerMedia. But you have to make a decision about who is going to lead the content organization, the studios and networks group, and my decision was Ann.
Will there be layoffs as a result of the reorganization?
We’re not talking about layoffs specifically but obviously there will be layoffs just given the nature of what we’re doing here.
There’s nothing new there. Ellen’s doing what she does best right now. We’re fully supportive of her. Aside from what’s been shared publicly, there’s really nothing to comment on.
Interview edited for length and clarity.
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