Peter Bart: Hollywood’s New Leaders Face Challenge Of Creating New Brands, New Channels And New Audiences

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His credentials seemed impeccable. He was 60, a Yale graduate, a former studio chief, a gifted dealmaker and now a newly named company president. But there were a few clouds: He was also a convicted embezzler, a compulsive gambler and his Yale degree was bogus.

This was 1981 and David Begelman, the new boss of MGM, was in many ways representative of the executives who were running Hollywood in that period – men who compulsively operated on the margin.

The cast of characters of that generation would not have been comfortable in the same room with the corporate soldiers who are presently taking their seats at the CEO table – Jason Kilar (WarnerMedia), Bob Chapek (Disney), Jeff Shell (NBCUniversal), et al. All came armed with Harvard MBAs and have already proved their management skills at various corporate levels: Kiler built Hulu. Chapek ran the world’s biggest theme parks. Shell built a giant global distribution machine. “The suits are taking over from the thieves,” the late Sue Mengers once put it.

And just as the personalities have become more sophisticated, so have the structures they now rule. The Warners logo once signaled the power of a single eccentric mogul, Jack Warner. Today, Kilar, the new president of WarnerMedia, must cope with a corporate pantheon: Bob Greenblatt’s WarnerMedia Entertainment, Ann Sarnoff’s Warner Bros, Toby Emmerich’s Warner Bros Pictures and Jeff Zucker’s CNN among others. Each of these players likely wanted his job.

Further, Kilar must also report upward to the “bell heads” at AT&T like John Stankey, who is now replacing Randall Stephenson as CEO and who has worked out his own scenario for the future of the entertainment industry.

The question being asked by Hollywood: Will these corporate monoliths be nimble enough to accommodate the fast-paced changes overtaking the global ecosystem?

The managements of a generation ago, with all their faults, were keenly adaptive because they never operated by the rule book, nor did the “owners” to whom they reported. Ownership of the studios had passed from the Louis B. Mayer generation to maverick rule-breakers like Charles Bluhdorn (Gulf & Western), Kirk Kerkorian (MGM), Ted Turner (CNN) and Steve Ross (Kinney). Their relationships with Wall Street, and with government regulators, were at best chaotic.

To Bluhdorn, the hiring of Bob Evans to run his studio represented his defiance of a disintegrating establishment. When the Paramount torch was passed from Bluhdorn to Sumner Redstone, it seemed like an inevitable evolution since both had an appetite for disorder.

Today’s corporate players understand that they, too, may have to redesign the rules, but within corporate disciplines. They must pay homage to the rituals of synergy while fomenting battles for brand recognition. At WarnerMedia, this means creating consumer loyalty to HBO and the newly launched HBO Max. Lurking across the hall also are TNT, TBS and TruTV – all sharing the same Emmy campaign teams.

At NBCUniversal, Shell, confronting a 2.2% revenue decline from Comcast cable networks, is now building an NBCUniversal Television and Streaming division to encompass his networks plus the NBC broadcast network and the late-blooming Peacock streaming service, which embraces library treasures like E.T. but lacks the catalogs of rivals like Netflix or AT&T.

A convivial man, Shell must nonetheless cope with challenges from exhibitors who dispute his ideas on windowing (AMC refuses to book Universal movies) not to mention producers who distrust his passion to reboot former hits like Dolittle and The Mummy (both of which flopped).

Even the news side poses challenges: Shell has brought in a non news man in Cesar Conde from Telemundo to rebuild troubled morale at NBC News, perhaps even to re-invent CNBC as a moderately conservative alternative to the resolutely predictable MSNBC.

When Kilar’s appointment at WarnerMedia was first announced, former associates described him to be a “product geek.” While that term has yet to be defined, it suggests one important challenge facing Kilar and his competitors: If consumers are baffled by the brands and also critical of the product, that could spell career problems for the product geeks, whomever they may be.

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