Investor Jeff Sagansky took Hollywood to task for decisions that have led to a massive destruction of value and are causing an “unbelievable cataclysm in the business,” speaking in a keynote interview at TheWrap’s Grill conference on Tuesday.
“You’re seeing the traditional business collapse,” he said in a conversation with entertainment entrepreneur Peter Guber and TheWrap’s editor in chief Sharon Waxman. “And at the same time, you’re seeing all this predatory behavior from the streamers and the two of them together are causing unbelievable cataclysm in the business that we both love.”
Sagansky accused Hollywood’s traditional studios of accelerating the decline of linear television by choosing to abandon programming in favor of streaming platforms, which led to what he called “predatory” behavior from streamers.
“It’s still [a] $150 billion value business in terms of revenues,” he added, noting that major sports like the NBA, MLB and NFL alone represent a $40 billion business, much smaller by contrast.
Sagansky also predicted that the four leading streamers — Netflix, Amazon Prime, Disney/Hulu and Max — would form an entertainment oligopoly that is likely to draw scrutiny from government regulators.
Sagansky highlighted a total loss of $190 billion in value in the stock prices of major entertainment companies including Warner Bros Discovery, Disney and Paramount, noting that television, the traditional driver of the entertainment industry for half a century, has lost “almost half ” of its audience.
Guber, another Hollywood veteran and CEO of Mandalay Entertainment and the Los Angeles Dodgers co-owner, noted that amid mass layoffs, steep cuts in production, and an anxious search for streaming profitability, there’s more uncertainty in Hollywood than ever.
“There will be blood, just like the movie, but there will also be opportunity,” Guber said. “Don’t give up on entertainment. It’s been around for thousands of years. It’s not going to go away in 2025.”
During the conversation, Sagansky said he is still astounded by how entertainment companies got to this point by pushing their film and TV libraries to Netflix in response to the decline of the DVD market in the late 2000s and early 2010s.
“When streaming starts, people have a choice they can make, and they make it. So what does cable do? They raised the prices. They produced less programming at a time when the building was on fire,” Sagansky said. “They just looked at their cash cow and said ‘OK, it’s over,’ and that was a fundamental mistake.”
While there are differences between live sports and the rest of entertainment, Guber believes there’s one key similarity in finding success in both worlds: find a position as the bridge between artist and audience. As part of the ownership groups behind teams like the Dodgers and Warriors, he sees those teams’ venues — the new Chase Center in San Francisco and the venerable Dodger Stadium in L.A. — as “cathedrals” that foster generational connections between teams and fans, and he tries to make those venues into places that people feel active in the story being told during the game.
“You have to find your way through, to be active in your own rescue. Don’t wait just for the government to give you a clear path,” Guber said. “Create your own path. If you don’t, you will be on the dustbin of history.”
Sagansky and Guber also discussed the potential impact of artificial intelligence on filmmaking and whether it will expand or curtail opportunities for filmmakers. To see that debate, check out the clip above. (Full interview to follow.)
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