From Deadline Hollywood:
The emergence of Netflix, Amazon and outside financiers in the auction process has transformed films and even books into an absolute sellers’ market. After Sundance saw Amazon scoop up numerous titles at premium including the $10M deal for Manchester By The Sea and Netflix post an astounding $20M offer for Nate Parker’s The Birth Of A Nation (he took $17.5M from Fox Searchlight for a traditional prestige theatrical release), we’re seeing the outsider influence in two big auctions going on right now. There is the Will Smith action film Bright, and the David Grann book Killers Of The Flower Moon: An American Crime And The Birth Of The FBI. In the latter case, at least one bidder surpassed $2M for an outright buy and word is this is headed for a $3M+ deal, because it hasn’t finished yet.
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Let’s take the book deal, first. When CAA put this out for bids, studios and producers loved it, even if it is period, not overtly commercial and execution-dependent. It is a sprawling story, the kind that attracts actors like catnip, and one that could even lend itself to a True Detective-like limited series. So when Deadline revealed the book and its bidders earlier this week, expectations were a nice six- against seven-figures deal. Now, word is that at least one outside bidder has stepped up to over $2M for an outright purchase, and the question will be, does price win this, or elements? And, will a studio pay more than it is comfortable with, to keep a promising project from getting away?
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It was unclear who the biggest bidder is, so some of this is fast and loose. Rumors pegged AG Capital’s Alex Garcia and Laura Walker while others suggested it was a financier on the James Gray-directed Lost City Of Z (Ascot Elite Entertainment Group?). There are also expectations that Netflix will enter the fray in a bid with producer Scott Stuber (he’s Universal-based, but Jason Blum and Scott Rudin have it for that studio), and PalmStar Media is also in the mix as well. All this could wind up making Killers Of The Flower Moon a book that sells for an enormous sum. For someone covering books for as long as I have, this is reminiscent of the stampede to win rights to The Horse Whisperer, the Nicholas Evans novel that was bought for $3M by Disney and turned into a 1998 Robert Redford film best remembered for launching the career of Scarlett Johansson.
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So what’s wrong with the economics being driven up by new buyers, when cost-conscious studios crunched deal largesse over the past few years? There is a danger, said one seasoned studio observer watching all this unfold: “The theatrical business, which is important for those of us who love film in theaters, depends on profit and loss. All studios are equal and compete equally in that regard. All of us at the studios have to make a profit. Like Amazon, Netflix does not have to make a profit. For them it’s all about their valuation on Wall Street, which comes only from the number of subscriber growth. So they actually have no P&L on individual projects. They can pay whatever they want. This is how Amazon drove every bookstore out of existence. Netflix wants to destroy the theatrical ecosystem. I admire them for it, from a business school standpoint. It’s true disruption. But, long term, the art form will suffer.”
Link to the rest at Deadline Hollywood and thanks to Judith for the tip.