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Amazon CEO Asks His Hollywood Studio To Explain Its Big Spending (bloomberg.com) 110

Amazon CEO Andy Jassy is taking a hard look at how much the company's Hollywood studio spends on original TV programming. From a report: In recent weeks, he has asked executives for detailed budget analyses of some of their biggest shows, according to people familiar with the matter, scrutinizing the studio's ballooning costs and mixed track record with audiences. The world's largest online retailer is engaged in a companywide cost-cutting program, with plans to eliminate at least 27,000 jobs. Across Amazon, Jassy has also jettisoned 37 different projects deemed unnecessary.

The Hollywood studio, which has spent tens of billions of dollars on original programming over the last decade, is an obvious place to look for savings. Last year, Amazon spent $7 billion on original shows, licensed programs and sports, up from $5 billion the year before. Only Netflix and Disney spend more on streaming. In the past nine months, Amazon has released at least a half-dozen pricey series that failed to deliver huge audiences. Daisy Jones & the Six, The Power, Dead Ringers and The Peripheral all cost more than $100 million to produce but failed to crack Nielsen's list of the 10 most-watched streaming programs in the US. Even The Rings of Power ($400 million-plus), a show that attracted a large audience, failed to hold on to most of its viewers over the course of the season, according to The Hollywood Reporter.

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Amazon CEO Asks His Hollywood Studio To Explain Its Big Spending

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  • by fleeped ( 1945926 ) on Wednesday July 05, 2023 @12:15PM (#63658888)
    This LotR monstrosity can go die in the flames of Udun, and I'm happy that it's being an expensive lesson. Make fewer series, make things that people want to watch, and don't shit on superb quality material.
    • by cob666 ( 656740 )
      I'm not surprised that The Rings of Power didn't do very well. They tried to make a captivating TV series about an epoch in Middle Earth where they only had the rights to a small part of the source material, so they had to create new characters and story elements to move things along. So, pretty much right off the bat they alienated most of the hardcore Tolkien fanbase.
      • they only had the rights to a small part of the source material, so they had to create new characters and story elements to move things along. So, pretty much right off the bat they alienated most of the hardcore Tolkien fanbase.

        Even having to make things up though, they could have done this in a way that was appealing to fans.

        What they did with the early Hobbits was atrocious and made no sense.

        Female dwarfs without beards, unthinkable transgression.

        • by alvinrod ( 889928 ) on Wednesday July 05, 2023 @01:04PM (#63659088)
          Even if it weren't faithful to the lore, it could have at least survived if the plot or characters were decent. They largely aren't, and so no matter how faithful they might have been to the source material and all the little details the overall product would still have sucked.

          When your main character jumps off a boat in the middle of the ocean with the intent of "I'll just swim back" because some idiot wanted a cliff hanger at the end of the episode to fit in with the half-brained metaphor they set up at the beginning of the episode, you know it's going to be a bumpy ride.
          • When your main character jumps off a boat in the middle of the ocean with the intent of "I'll just swim back" because some idiot wanted a cliff hanger at the end of the episode

            Even for some super-elf, what were they thinking with that one? How does such a totally out of bounds idea make it into a final show with that kind of budget?

            It just had problems of that magnitude at all levels.

      • Re: (Score:3, Interesting)

        by Opportunist ( 166417 )

        So, pretty much right off the bat they alienated most of the hardcore Tolkien fanbase.

        Which was one more straw to break the camel's back. Because Tolkien fans are pretty much the only ones who give a shit about the whole lore around middle earth. For anyone just wanting a fantasy story, this could be set in some D&D-esque backdrop and they could have saved a lot of money on IP.

        • by bobintetley ( 643462 ) on Wednesday July 05, 2023 @02:17PM (#63659372)

          this could be set in some D&D-esque backdrop and they could have saved a lot of money on IP.

          I think their thinking was that if it didn't have the LotR name on it, they wouldn't be able to justify how much they were spending because far fewer people would watch it.

          Even the Tolkien fans who hated it still watched it to make sure they hated it I guess?

          • That would explain why only about 30% of the people who started it stuck to it. Tolkien fans that saw the first, got the confirmation that it's crap and didn't look back.

          • by AmiMoJo ( 196126 )

            I enjoyed reading the LOTR and The Hobbit, but gave up a few episodes into the show. It just wasn't very well written, failing to engage the viewer and make them care about the characters and events on screen.

            They clearly threw a lot of money at the production, but apparently not at the writing.

      • Rings of Power was ok sort of, I enjoyed despite the flaws, but it was expensive relative to the results. Many of The other Amazon production r mostly not interesting to me.
      • No.

        I'm a Tolkien fan: I enjoyed the Silmarillion.

        I watched it (of course). The problem wasn't the source material they had access to. The Silmarillion is far too sprawling to be captured and it's more like a plot summary in book form. It's absolutely 100% fine to concentrate on a small segment of time and expand it out as necessary. Good, even.

        The problem was it was just bad TV in a number of normal, boring, work-a-day ways, mostly involving having a dreadful script. I watched the first few episodes and the

    • by r_naked ( 150044 )

      This LotR monstrosity can go die in the flames of Udun, and I'm happy that it's being an expensive lesson. Make fewer series, make things that people want to watch, and don't shit on superb quality material.

      You left out the most important piece that they need to have drilled into their heads: "Make series that have self contained seasons!!!"

      The risk of a series being cancelled is just way too high. So high that I (and I am sure plenty of others) don't bother watching until the entire series is complete. Now, I realize that by doing this it lowers the chances of the series being renewed and especially completed. Oh well, been burned TOO many times. There are better things I can do with my time than to watch a s

      • by r_naked ( 150044 )

        Weird, not positive what happened to the end of my sentence, but I believe palm detection didn't detect my palm and it was wiped out.

        It should have read:

        "If they make their series in such a way that each season is self contained and completely resolved, then I am more than happy to watch. American Horror Story is a good example of this, and Black Mirror is another example, with each episode being self contained. They could also come up with sort of guarantee that a series will be completed -- however, I rea

    • Unlikely. The Rings of Power was expensive, but I think more than half the expense was the license. That's paid already. In addition tons of the design work is done already for the first season. Unless they were planning on introducing tons of new concepts (later Southerlings, e.g.) the remaining seasons should be way cheaper.

    • I liked the LOTR show and hope they do another season. Was it amazing? No but it was fun to watch and I enjoyed it. Of course, I can't recite back Tolkien and don't really care what they changed from source.

      The Wheel of Time on the other hand was downright painful garbage. I of course could also recite the books and expected a 1:1 adaptation.

      So I get the hate against LOTR because that's how I feel about what they did to WOT. If I was rich enough, I would have WOT done precisely like the book was done and as

  • They’re using the time honored Hollywood accounting method. https://en.wikipedia.org/wiki/... [wikipedia.org]

  • by klipclop ( 6724090 ) on Wednesday July 05, 2023 @12:25PM (#63658944)
    Though I'm not a big fan, I'm sure that's pretty popular. Just like unicorn speculating, you need to spread money around since you can't guarantee certain shows will provide that 10000x return. But sometimes I forget that Slashdot is click bait half truths articles copied from Ars now.
    • What about lord of the rings? I'm sure that's pretty popular.

      You'd be wrong. It didn't even break into the top 10 of streaming shows for 2022. Only 37% of US viewers that watched the first episode completed the series. Those are some pretty horrific stats considering the budget of this series, and the massive advertising money and clout that Amazon threw behind it.

      https://www.denofgeek.com/tv/l... [denofgeek.com]

    • What about lord of the rings?... I'm sure that's pretty popular.

      It was very badly done and often boring to boot, as a result it lost a lot of viewers [fandomwire.com] after the first few episodes, and cost almost a billion to make so pretty sure that was a negative ROI.

      You do indeed have to spread around funds to try and make something people want to watch. But Amazon doens't seem to have had any luck yet in making tentpole originals that attract people the way Game of Thrones did for HBO, or Stranger Things did for Netfli

    • by fermion ( 181285 )
      Everyone is looking for a franchise where you can tell the same stories, utilize the same characters, over and over again. That is why Star Wars is worth a billion and paramount is banking its future on shows like strange new worlds. If they hit it is easy money.

      On the other hand, Amazon is buying rights to sports, which are so extravagant they can only be seen as loss leaders to gain subscribers. It is money down the drain.

  • EXPLAIN! (Score:5, Funny)

    by dmay34 ( 6770232 ) on Wednesday July 05, 2023 @12:26PM (#63658948)

    CEO: Explain your big spending!

    Studio: Your CFO gave us a budget, we spent the budget.

    CEO: What if we cut your budget by 50%!!!???

    Studio: Then we would spend that.

    • Exactly. The studio's budget is a portion of Amazon Prime membership revenue. How exactly are they figuring out the profit for these shows/films is beyond me. Amazon Prime originally was just a membership for fast shipping, its now just a funding source for random ideas coming out of Amazon and the customers are getting ripped off. Amazon grew into a confusing mess.
      • I don't understand the point of amazon prime anymore. The fast shipping (1-day!) is now "whenever it shows up."

        The shows are hot garbage in general with few that I want to see and the ones I do want to see take forever to get seasons (looking at you wheel of time circa Nov '21). When I look at what they have i'm like... who wants to watch this garbage? Their big ticket item citadel is hot garbage and completely unrelatable half way through the pilot, and it doesn't get better after a few episodes. No thanks

  • Quote: "Even The Rings of Power ($400 million-plus), a show that attracted a large audience,"

    Nothing more to add.

  • It feels like the industry is starting to realize that the content-as-a-commodity market that tech has been trying to create doesn't actually work for fans. Amazon is great at metrics and analytics but making entertainment that will capture the hearts and minds of an audience is more than just an algorithm of IP, actors and production credits.

    Amazon cannot produce a good TV show the same way they low cost shower curtain. Algorithms can generate content all day but groundbreaking entertainment requires
  • by smooth wombat ( 796938 ) on Wednesday July 05, 2023 @12:44PM (#63659022) Journal

    I'm presuming this CEO, and others like him, will have their salaries cut, bonuses stopped, and other perks significantly pared back. Lead by example and all that.

    • If he kills Rings of Power ALONE, he's earned his bonus and the appreciation of all Tolkien fans.

      If he happens to kill the ridiculously woke Wheel of Time series, that wouldn't be bad either.

      I know...maybe just make a series based on the BOOKS, not primarily around delivering an agenda?

  • Hollywood has always relied on "Angel Investors" who pour money into their pockets without ever seeing a return, in exchange for getting to hang around Hollywood and be smoozed. Amazon is just another whale to be harpooned.
  • mistake (Score:4, Interesting)

    by groobly ( 6155920 ) on Wednesday July 05, 2023 @12:50PM (#63659038)

    Amazon's big mistake is having a HOLLYWOOD studio. That would be like Elon Musk deciding to base Tesla in Detroit.

    • by DarkOx ( 621550 )

      I am not sure I agree. Certainly Tinsel how has a huge problem with unions. They are blood suckers that make getting anything done expensive and slow. This is why you see so much production of things like commercials (for the American market) now being moved to Mexico.

      That works for ads, and it may work for low-art television type products like sit-coms, cop-dramas, etc. For big budget movie and mini-series products, names matter. Having a list of A-list and B-list celebs attached to your project may mak

  • Really, a few weeks ago I didn't know what to watch, checked Netflix, Disney+, and for the first time since LOTR I checked Prime Video, wondered "yeah, why not start that" and it is a sublime serie, we binged the 5 seasons in like 3 weeks.
  • Advertising? (Score:4, Interesting)

    by Austerity Empowers ( 669817 ) on Wednesday July 05, 2023 @01:21PM (#63659162)

    I have heard of The Peripheral mostly by accident, and watched it, it's not bad. It needs a little work tightening up the storyline, but it is worth watching. I somehow never heard of Daisy Jones & the Six, The Power, or Dead Ringers. I don't think I saw any of those names when I fired up the app either. Maybe they need to do a better job of promiting their own stuff, possibly just using their own platform. They should also probably drop the weekly release thing and use a viewership metric that isn't tied to who views immediately. Now that the pandemic is over, I don't have time, mental bandwidth or interest in watching slow release shows. Often there's something I saw that I might like, realized it's not fully released and move on, forgetting about it the next day (ex. Citadel).

    • I also enjoyed "The Peripheral", though it was slow at times and your commentary also holds. Citadel was pretty good. I also recommend "Upload" (if you're into comedies) and, obviously, "The Expanse".

  • It makes sense; they can't just hemorrhage money forever.

    Wife has Netflix, and I have to say, I'd never heard of any of the shows referenced in TFA except Rings of Power. We tried to watch it and gave up on the third episode. Never mind it pretty much screws Tolkien's mythology, but it could still be watchable were it written well. And it wasn't.

    Word is, it started with high numbers, but only 37% of those viewers saw it to completion. For a billion dollar franchise, that's ... not good. And I just get

  • by Opportunist ( 166417 ) on Wednesday July 05, 2023 @01:39PM (#63659230)

    I have an Amazon Prime sub. I have NEVER seen it. Like, ever. And I don't mean watch it. I have not SEEN it on the Prime screen. One should think that they feature that thing prominently somewhere, or bother you with ads for it (it's not like they're shy to pester you with ads before every single damn episode of a show you watch).

    I guess their own opinion about that show ain't too high...

    • I suppose when it was actually running you would have seen it all over the place. But, since it was such a failure during its run, it's not worth featuring it any more prominently, as the returns are expected to be near-zero. It had its run, it failed, so they're devoting the Prime screen to newer shows.
    • I had plans to watch it but the negative reviews started pouring in so I did not. Of all things not to do, breaking the lore was probably high on the list. Fans would probably fine if it was mediocre. As an opposite example is the latest Dungeons and Dragons. The last one was actually good and stayed true to the lore. Of course some things were changed like druids cannot morph into owlbears but those are minor quibbles.
    • by elvesrus ( 71218 )

      Rejoice, for they have spliced those preroll ads in to the videos themselves without changing any of the timings on videos, such as subtitles or next episode.

  • If they would stop destroying well established stories to push a political agenda maybe they would stop losing so much money.

  • by tlhIngan ( 30335 ) <[ten.frow] [ta] [todhsals]> on Wednesday July 05, 2023 @04:41PM (#63659814)

    Hollywood is expensive. That's all you need to know. You go to Hollywood and see the amount of money being spent there and that's why your studio costs billions to run.

    And you really can't avoid it - if you want named talent, they're going to cost you - first as a flat payment, then residuals. An action movie can cost $100M on the low end to shoot - if you want cheaper you need to switch genres to like rom-coms and such.

    TV content isn't cheap to produce either - top tier TV shows often pay the talent $1M+ per episode - or more ($5M isn't unheard of). On a normal TV season with 24 episodes, that's $24-120M for ONE actor. The others will demand similar amounts, so a decent cast can probably demand $200M-1B just for the actors alone. Sure, that's why we have 10 episode series , but having a few of them and you're already in the billions in acting fees. Then you have everyone else, directors, PAs, props, special effects, etc. Add in location permitting and yeah.

    You have to remember Hollywood actually imposes a lot on shooting locations, and to stay in the good graces of many locations, they pay really well. Not quite bribery, but they pay enough that it's a generally good experience so you'll let them shoot there again. I've seen them rent out a parking lot, paid employees to park elsewhere or taxi to work for the entire time (overpaid, even - if you wanted to pay for express service, they let you - again, minimize inconvenience). Then at the end, they cleaned up, and the parking lot was refreshed and repainted and everything got fixed up - left it better than they got it.

    If your business needs to close a few days, they'll compensate you and let you stay open when they're not shooting so you can still service some customers. And if it's a business they can use the services of (e.g., it serves food). they'll buy your food.

    If Amazon wants to save on things like this, shoot elsewhere. Bollywood is still very cheap. Otherwise, think back to the Simpsons episode where Hollywood comes to Springfield and yes, that happens a lot too.

  • I've watched all of Amazon's originals. Most are trash.

    Thanks for trying.

    • by boulat ( 216724 )

      "Odetta Watkins, the company’s head of drama series, said Citadel “needs time” to grow its audience at home."

      Googled her picture and I instantly knew

  • It's like the Disney streaming story, the spending is all about writing off loses on assets. So money burned in Hollywood is a great way to offset the tremendous windfall of wealth God gave Amazon during the pandemic while the Hollywood suffered. Perhaps amorality is the moral of the story, meanwhile irony thickens plots. ChatGPT won't go on a writer's strike.
  • And that's an awfully low bar to set, but yet Amazon manages to trip across it consistently.

    - The app UI is slow as shit on all but the latest Roku devices.
    - Finding things your interested in on Amazon Prime Video is an exercise in futility unless you know the name of it.
    - Their habit of intermingling paid content with Prime content is not user friendly. At all.
    - When they do legitimately create solid content from a well-known writing team (Looking at you Paper Girls), they don't market it and cancel it pre

PURGE COMPLETE.

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