« Movie companies rarely make a lot of money, » Diller said during a keynote session Thursday at the 2017 CES trade show in Las Vegas Thursday. « A standalone movie studio today is a hardly a great business proposition, » he said, allowing that Disney is an exception in the industry.
Movie studios today are centered around « huge, blockbuster movies that have to do $500 million to break even — I mean, that is not a creative enterprise, » said the septuagenarian media mogul, who is founder and chairman of IAC and chairman of Expedia. « The fact we get any good movies is almost a miracle. »
Diller’s comments come after the movie industry notched a record $11.4 billion in North American box office revenue in 2016.
What’s changed for the movie business in the last few years, according to Diller, is that internet streaming and over-the-top video services have weakened the powerful hold media conglomerates used to enjoy with respect to downstream distribution. In the past, media congloms « could be a highwayman taking the toll from anyone who wants to cross the media road, » said Diller.
After Diller lost out to Viacom in 1994 for Paramount after a six-month battle, he issued a terse statement saying: « They won. We lost. Next. »
As for pay TV, a business in which Diller was once himself a notable player as owner of USA Networks, he predicted that the internet is poised to bring further disruption. The advent of « skinny bundles » from the likes of Hulu, DirecTV, Sling TV and others will reach its ultimate conclusion with consumers picking and choosing which networks and services they want rather than purchasing a bundle, he suggested.
« I think mostly, you will curate (TV content) yourself. You will decide: I like Netflix, Amazon, ESPN, whatever, » Diller said. « Why would you let someone else warehouse those for you? »
Diller also address the issue of fake news, which became a hot-button issue after the 2016 U. S. presidential election. He said one of the biggest problems is programmatic advertising – because that lets marketers blindly buy ads without knowing where they’ll appear. « Unless you put some human barricades, barriers so to speak, in front of it, this is going to proliferate, » he said.
Diller, who has criticized Donald Trump as a « bad clown » and « huckster » in the past, tangentially addressed the incoming president in his remarks Thursday.
« I’m only marking this new presidency in one-year increments, » he said during the keynote session, moderated by Michael Kassan, CEO of consulting firm MediaLink. Last fall Diller claimed he would either leave the U. S. or « join the resistance » if Trump were elected president. (He evidently has not emigrated at this point.)
Commenting on his approach to acquisitions — wearing both his IAC and Expedia hats — Diller said his companies do not merely stick to their knitting.
« We’re open field, » he said. « We actually truly have no blinders on. We don’t want to. We would have never gotten as far as we have in internet life if we had. «
