Lionsgate Likes Cozying Up To Alibaba, But Won’t Discuss Sale Chatter

Lionsgate execs wouldn’t bite when analysts invited them to address the most important question facing the independent studio: Whether there’s anything to the report that its largest investor, co-chairman Mark Rachesky, is considering selling his 37.4% stake to Alibaba. But they don’t seem to mind having a closer relationship with the Chinese e-retail colossus — its partner there in a new subscription streaming service, Lionsgate Entertainment World, which features the Lionsgate’s movies and TV shows. “We’ve shown with our relationship with Televisa, with Canal Plus and Studio Canal that having interesting partners in other territories can be a benefit,” CEO Jon Feltheimer said this morning in the company’s quarterly earnings call. “It doesn’t need to be on an equity basis. You’re going to see me spending a lot of time in China at the beginning of next year….Certainly equity always encourages people to do other strategic things with you. But at the end of the day I think it’s just a way of creating partnerships.”

China-Based Internet Company Alibaba Debuts On New York Stock ExchangeHe added that the studio is “in discussions with several other prospective partners for additional online branding platforms” similar to the streaming one with Alibaba, but didn’t elaborate.

Execs unveiled two initiatives: a stage show for The Hunger Games, and a partnership with free-to-play gaming company Kabam for The Hunger Games: Panem Rising. They call this “the official mobile game” for the upcoming The Hunger Games: Mockingjay Part 1. It’s available for iPhone, iPod touch, iPad and Android devices.

On another front, Lionsgate seems to be in no hurry to unload its 50% stake in TVGN (TV Guide Network) which it shares with CBS — and is about to be rebranded as POP. “We are actually already doing some pilots for the channel,” Feltheimer says. “The ratings have gone up very consistently. We love the new brand.” And he says all’s well with the relationship with CBS. “It’s a pretty small business for them, but they have been tremendous partners and together we can keep building something really terrific.”

Feltheimer, who considers Lionsgate to be a business disruptor, danced a little when asked for his view about Netflix’s plan to simultaneously offer Crouching Tiger 2 next year to its subscribers and to theaters — which infuriated the largest chains. “We’re definitely big believers in the theatrical window which really is the driver of the food chain particularly for big movies,” the CEO says. “But we also welcome new ideas and innovation.” When changes work, then consumers “will pay a premium for it.” And he’s intrigued by a possible twist for Netflix’s movie ambitions.  The streaming power could offer “a Netflix event movie that ultimately becomes, within a short period of time, a series.” Lionsgate already produces Orange Is The New Black on Netflix.

Illustrating its interest in new things, Feltheimer noted that Lionsgate is starting to shoot some movies with 360-degree cameras to take advantage of technologies including the Oculus Rift 3-D headsets. “We think that’s one of the enhancements that will make our home entertainment product significantly more valuable” he says. “Game product as well. We think it’s pretty cool technology starting to happen out there and we’re already taking advantage of it.”

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