Asian media giant CJ made one of the entertainment industry’s biggest plays in 2021. CJ ENM’s acquisition of 80% of Endeavor Content’s scripted business valued the firm’s drama offering at almost $1BN. Focus now shifts to the mega deal’s next steps, as Parasite distributor CJ ENM takes control of a portfolio featuring Once Upon a Time… In Hollywood, See, The Revenant, The Night Manager, Call Me By Your Name and Killing Eve, as well as the upcoming Reminiscence and Blue Miracle. CJ ENM, which was established 12 years ago, now has a solid pipeline into Hollywood, coming at a time when Korean content is as hot as it’s ever been, led by the huge success of Squid Game. How will Endeavor Content’s core scripted output change, to what extent will the business be restructured and what are the synergies that can be drawn between the two? It didn’t work out for Eros and STX but will the CJ deal herald a new round of M&A in which international giants look into the U.S. for their growth? These are all questions that should be answered in the year ahead. One thing is for sure: the deal has lightened Endeavor’s debt load and signals major global ambition from Asian powerhouse CJ. The CJ/Endeavor deal wasn’t the only 2021 headline-grabber in terms of U.S-international synergies. Next year will also see the bedding in of U.S. management and production stalwart Anonymous Content’s France-based tie-up with Euro firm Federation Entertainment, as Anonymous/Federation sets about forging content for the French and global markets. This is just the latest European expansion for Anonymous (which also inked a deal in 2021 with Israel’s leading talent agency) with and a sign that U.S. outfits continue to look abroad to deepen international ties. Meanwhile, French outfit Federation is setting up a U.S. management firm. The global flow of business (and talent) has never been as fluid.

Bustling Indian Streaming Market Set For Key Year

Sacred Games

The streaming wars in India have been raging at a high intensity throughout this pandemic, which has seen a swathe of high-profile, theatrical-bound titles pivot to an online release. It has been a shock to the system for the traditionally cinema-first nation. The influx of international streaming services combined with a surge in powerful local players has set the scene for a fiercely competitive market that continues to grow at enough pace to allow all players to expand – but will a ceiling be reached in 2022? India’s population is vast, and also very young, with an average age of just 29. Combine that with widely available high-speed internet, growing wages, and a strong appetite for content, and it seems arguable that there could be several years left in the territory before subscriber numbers begin to plateau like they are doing in certain western nations. However, streamers aren’t resting on their laurels, with clear recent indications that the big players are planning to get active in their manoeuvres next year. Netflix made headlines recently when it slashed prices across its various subscription tiers in India, including the popular ‘Standard’ sub, which dropped a hefty 60%. The move, which comes as other territories continue to see price increases, was read as an aggressive play for subs, prioritizing those numbers over revenue, at least in the short term. “The one-billion-person opportunity in India is very real… We have observed how subscriber numbers drive the psyche of Wall Street investors,” commented one industry source after the news. Also in December, Sony’s India arm finalized a merger deal with local rival Zee Entertainment to create the second biggest network in India. The pact is seen as a direct move to compete for online eyeballs with the likes of Netflix, Amazon Prime Video, and established player Disney+ Hotstar. The deal, which is subject to regulatory hurdles, includes two streaming services – ZEE5 and Sony LIV – could it be a sign of more consolidation to follow in the coming year? Amazon, which has been the most active player in picking up rights to talent-driven movies that had to skip their cinemas runs, recently nabbed rights to cricket matches the Indian national team plays in New Zealand, a key draw for cricket-obsessed local audiences. On that note, perhaps the most significant moment in Indian streaming next year could be the next round of bidding for the popular cricket tournament the Indian Premier League, with streamers in the mix last time out before Star India (now part of Disney) triumphed. The winner of those rights could steal a march on its competitors.

Africa: The Next Frontier?

The Wedding Party

Keep an eye on African content next year, which is set to become more prominent on global streaming services. Amazon recently closed a multi-year agreement with Inkblot Studios, one of the leading producers in Nigeria with credits including the box office smashes The Wedding Party and its sequel, to take exclusive global rights on its slate post theatrical. “Nigerian stories are truly some of the most exciting and thrilling in the world,” said Ayanna Lonian, Prime Video’s Director of Content Acquisition, on the deal. That pact follows Netflix’s tie up with Nigerian producer EbonyLife, which will continue to bear fruit next year. International streamers are beefing up their local slates in Africa to compete with local players including Showmax and MyCanal, and Disney+ is expected to become the next U.S. giant to enter local markets there in 2022. With VOD subscribers projected to triple across the continent in the next five years, Africa could become the next key battleground as subs begin to plateau in other more mature markets.

KSA Arrives

Saudi Arabia, it could be argued, has been the international industry’s breakout country of 2021. While the KSA has threatened to breakout since cinemas reopened in 2017, 2021 was the year the country hosted its first international film festival and multiple significant English-language productions in the shape of big-budget action pics Desert Warrior and Kandahar, as well as horror movie Cello. A government body estimated that in 2017 Saudis spent $30BN on entertainment and hospitality elsewhere in the Middle East. As cinema numbers surge and events grow, a decent chunk of that money should be spent locally instead. Some insiders are even predicting that the controversial state could become a billion dollar distribution market within the next few years. The growing number of international shoots and the starry Red Sea Festival (as well as an increasing number of major sports and music events) seem to indicate that qualms over the country’s depressing human rights record will not stop industry growth. Look for that uptick to continue in 2022.

China?

What’s ahead for China and Hollywood in 2022 is currently a murky, frustrating and yet somewhat fascinating question. Demonstrating strong recovery at cinemas, the PRC will in 2021 be the No. 1 global box office market for the second year in a row. However, it could see that status revert back to North America next year. China was mercurial in 2021, allowing some studio titles through its coveted turnstiles, yet leaving a lot of potential on the table as it was stingy (or very late) with release dates and, notably, did not approve any film featuring a Marvel character (from Black Widow to Eternals, Shang-Chi, Venom: Let There Be Carnage and, so far, Spider-Man: No Way Home, which nevertheless has already crossed $1B worldwide without that market). There are varying theories as to why this happened, and equally there is confusion. A recent op-ed in CCP mouthpiece the Global Times accused Hollywood of having “distorted values of ‘political correctness’,” and “improper use of Chinese elements in their films.” It also pointedly asked: “Should the Chinese film authority allow… films to enter just because they are Marvel films?” While there’s no consensus among watchers as to when the situation changes, most agree it will have to if the market wants to retain its dominance. While an oft-heard refrain is that China doesn’t care about money, it’s also said the country does care about cultural power. And, though it may be entirely capable of churning out local films that gross well over $500M at home, without Hollywood product, sources believe it will not be able to feed its ever-growing number of screens in a post-pandemic world. Meanwhile, it will be interesting to watch as the country takes to the global stage with the Winter Olympics from Beijing in February (just as the lucrative Chinese New Year box office period will be afoot and when, normally, there is a so-called blackout on imported films). Several countries have already engaged in a diplomatic boycott of the Winter Games owing to human rights issues, but are allowing their athletes to travel. For Hollywood, we’re told, China remains a very important market, but one that needs to find a fine line between what’s important politically and what standing it wants to have.

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