Endeavor CEO Ari Emanuel never brought up the name Scarlett Johansson, whose challenge to Disney alongside her reps at rival CAA has riled the industry. But in a virtual appearance at the Goldman Sachs Communcacopia Conference, the exec said talent is “getting paid very, very well” despite massive shifts in windows.
“Netflix started this,” Emanuel noted. In the movie business, “about 10% of the movies that went out [theatrically] hit the talent’s back end, meaning the profit participation.” Once Netflix bought out talents’ back end, “the pie was no longer 10%. It was 100%.”
When Warner Bros put its entire 2021 release slate on HBO Max at the same time it debuted in theaters, WarnerMedia paid out $200 million in back end, Emanuel said. (WarnerMedia and parent AT&T has never publicly disclosed a figure, but Emanuel’s number was north of the $180 million that’s been reported.)
Through Endeavor’s WME agency division, “we negotiated those deals throughout the process, and clients made a lot of money — again, without having to bet that they hit the back ends,” Emanuel continued. Disney, he added, has “done the right thing by talent because they need talent” in order to further its streaming ambitions.
WME has “created a formula” depending on whether theatrical or other windows are in the mix, the CEO added, without offering specifics. “Talent is getting paid throughout this process, and they’re getting paid very, very well,” he said. On the television side, he said, the surge in streaming entities on the hunt for quality series has given talent “massive leverage” in negotiating deals.
Johansson would beg to differ. After Black Widow was released both theatrically and as a Premier Access streaming title, she says her contract was violated when grosses underperformed, slashing her gross participation. In a response, Disney disclosed her base compensation of $20 million and accused her of being insensitive to world suffering during the Covid-19 pandemic.
Emanuel characterized Endeavor, which went public last spring, as a diversified media and entertainment firm, and the 40-minute session reflected that. Ample attention was paid to the company’s UFC and events businesses.
On UFC, which Endeavor now fully controls, Emanuel said, “We love our relationship with Disney,” calling ESPN (where UFC has a multi-year deal through 2023) “the Mecca.” The rise in sports rights valuations across the board bodes well for the UFC. “I’m not nervous about where we’re going to end up,” the executive said. “Now, you’re seeing the streamers come into it, so I’m feeling very good about where we sit.”