The Great Influencers: Hollywood

Is the business of Hollywood more dominant than the art of Hollywood? Janet Wasko, who has authored/edited 19 books including “How Hollywood Works” and is the Knight Chair for Communication Research at University of Oregon in Eugene, Oregon, addresses this question. While film is an art form, an educational medium and a popular form of entertainment, it has also developed as a business—a commodity that is bought and sold. Wasko explains how Hollywood works as an industry. Her look at the U.S. motion picture industry examines the economic aspects as important points to consider if we are to understand the influence of Hollywood in our country.

how much do we really know about Hollywood how it works its culture its power its influence on our culture and the world we have someone here today who can actually answer a lot of those questions she's Janet wasco she's the night chair of communications research at the University of Oregon she is also the author of how Hollywood works and the author of or editor of 19 other books on Hollywood and the cinema world ladies and gentlemen let's welcome Janet wasco [Music] hello everyone how you holding up well everyone wants me to tell you everything about Hollywood and I only have 16 minutes I'm really happy to be here and
I want to thank Randy especially everyone has to thank Randy for getting me to meet yes right and it's just been a pleasure I've been learning so much and just been inspired especially by our young musicians they are just so very special I'm going to talk about Hollywood that was my assignment and I want to start with well some comments I think many of us might agree that film might serve as an art form it's also possibly an educational medium but has also served as a medium of propaganda a popular form of entertainment and a new medium of literacy in the US and often elsewhere film has also developed as a business a commodity that is bought and sold some have even argued that the
business of Hollywood is more dominant than the art of Hollywood this is perhaps a crude and even maybe rude comment especially the day after Hollywood's annual global celebration of itself nevertheless the economic aspects of the US film industry are important points to consider if we are to understand the influence of Hollywood this image is not a mistake but we might add another image here and what an interesting juxtaposition this is isn't it if you're familiar with what happened last night at the Academy Awards but it is lala land that draws our attention to Hollywood I think at the moment and its reputation as a city of stars but I want
to imagine with you something like a Hollywood universe my Oregon colleague dr. Jeremy Schwartz and I have been developing this conceptual framing of Hollywood or a Hollywood universe while universes are complex and adaptive with a variety of interacting systems from atoms and molecules to comets and asteroids stars and planets and galaxies a Hollywood universe may be equally complex not only are there plenty of stars but the industry is composed of large corporate galaxies consisting of subsidiary planets various franchises or solar systems a variety of products that come and go perhaps like comets and asteroids we'd like to explore some of these characteristics of a Hollywood
universe emphasizing at least at the moment the business side of movies which may help us to understand the influence of this century-old industry we could start with this question well who is at the center of the Hollywood universe many of you may be familiar with the six degrees of separation game based on the concept that all people on earth are six or fewer acquaintances acquaintance links apart so the claim is that everyone in Hollywood can be connected to one actor by six degrees or less and that actor would be anyone Kevin Bacon yes and there he is there are certainly others who can claim to be at the center of the Hollywood universe but
more seriously we were supposed to be laughing a little bit at that thank you thank you a Hollywood universe would be dominated by a few gigantic galaxies these are also known as Hollywood majors they are huge diversified global organizations that are not only involved in producing and distributing films but also other forms of new and emerging media entertainment and leisure time activities other companies in a inhabit a Hollywood universe those that are owned by the majors and those that attempt to compete with them and even though some would say that majors are on the decline they still seem to dominate this universe let's take a look at the theatrical box office for last year
these top six production distribution companies regularly attract close over eighty-five percent of the domestic box office as they have for many many years and they still receive a sizable amount of revenue from foreign box office despite growing competition from other national cinema industries in this sense at least we can say that a Hollywood universe can be seen as an oligopoly a handful of corporations that dominate the theatrical film Marcus making entry difficult and working together when necessary to protect to protect their positions another way to better understand a Hollywood universe might be to examine this notion of risk it's often discussed by the film industry as well as injury industry analysts with the assumption that the film
business is not only unique but risky uncertain and even chaotic for various reasons i would like to argue that this assumption is a bit problematic one of the problems is actually in assessing the riskiness of Hollywood films or other aspects of a Hollywood universe because of the lack of reliable data assessments of costs and profits for Hollywood films depend mostly on inconsistent trade press reports like variety and unsubmitted systematic data from lawsuits and other sources practically every film industry researcher has acknowledged the problems of securing basic industry data and reliable information on deals and relationships as represented by Harold Vogel in this in this quote to fully understand the issue of riskiness as
well as other characteristics of a Hollywood universe we need to understand more we need to understand more about a variety of things one is the different types of deals commonly used in the industry although they are rarely made public we need to understand from those deals such as negative pickups co-production arrangements as well as independent producers who have ongoing arrangements with the majors if we consider these various kinds of deals it becomes clear that Hollywood majors don't always finance the production of the films that they distribute in addition claims about the riskiness of Hollywood Hollywood films most often focus only on these revenues received during a film's domestic theatrical release in fact there are revenues gained from a wide variety of diversified sources this may look a bit
complex but stay with me films are typically released first in theaters which sets the value for the markets the other markets to follow although other windows as they are called may represent higher earnings theatrical revenue is still substantial just look at how much Star Wars brought in a year or so ago even though it has been widely reported that Hollywood is struggling at the box office the release of films in theaters can still be quite lucrative in addition the distributor's share of the box office receipts can be as high as 90 percent of the growth after a theater owners expenses it is often claimed the distributor's receipts fifty percent of theatrical revenues but that would be a rather low estimate in addition though
as we can see on this timeline of distribution windows for films motion pictures are sold in many retail markets or windows of exhibition after their release in theaters they appear on DVDs pay-per-view subscription video-on-demand kiosk rentals at the moment at the moment such as red box cable and broadcast television and international markets other products in merchandise develop also from films and contribute additional revenues these are examples of the video game platforms that many films appear in after their theatrical release in other words Hollywood films and their licenses continue to make money for distributors in various platforms including these examples in various ways years after
their initial theatrical release interestingly and as you probably know many of the Hollywood majors most of them are involved in most of these markets conglomerate such as Disney represented here not only produce and distribute films but also television programming and other entertainment products as well as owning media outlets and other entertainment holdings this diversification makes it possible for them to survive periods when their films are not doing as well as they may desire this is not to say that there's not competition in a Hollywood universe and these dominant corporations are constantly challenged in a variety of ways including those independent companies we mentioned previously as well as economic conditions political
climates and so forth recently serious challenges have emerged from the new digital corporate giants that would be called they're often called gaffa or Google Apple Facebook and Amazon as I think Walt Mossberg discussed previously today these companies that have found success with newer digital technologies are moving also into film production and distribution and they represent real competitive threats to the majors indeed technological developments have had positive as well as negative effects on Hollywood on a Hollywood universe offering the potential for innovation and creativity but also opening the door for potential threats for instance Hollywood companies continue to work on
ways to protect and manage their property rights especially as digital technologies emerge and movements towards open access to cultural products continue to grow one of these recent developments that the majors are involved in at the moment is called ultraviolet this is a cloud-based digital rights locker for movies and television shows that allow consumers to store proofs of purchase of licensed content in an account which enables them to play to playback on different devices using multiple applications from several different streaming services ultraviolet allows users to share access to their library with up to five additional people at the moment ultraviolet ultraviolet is also deployed by a variety of companies
involved with what's called the digital entertainment content ecosystem this is an alliance of US companies around 85 at the moment that includes the film studios or the majors most of them retailers consumer electronics manufacturers cable companies and so forth Disney Google Amazon and Apple have their own systems as represented here this also reminds us of the wide array the wide variety of content and sources that are now offered in our homes on those big beautiful television sets that we now own over the top content we could continue pointing to other new technological developments and sources of competi competition but at the moment at least the Hollywood majors
continue to dominate a Hollywood universe they constantly change and adjust to meet various challenges and to exploit new opportunities the majors have survived many challenges over the years and continue to thrive thanks to some of the traditional deals and arrangements thanks to some of the traduce excuse me that are part of this universe they have provided sizable amounts of profits to key players in this universe we often hear the well well-worn phrase about Hollywood's power and influence it's just entertainment certainly Hollywood does offer us entertainment that can't be denied but it also is a universe who sorry it's also universe that provides cultural meanings including values
morals and codes of behavior for our society that is not to say that it is inevitable that a mage the major companies will continue to dominate with their emphasis on a bottom-line mentality that is often represented by blockbusters escapist fare and closed restricted systems by the number of independent titles as Kadim e ward nominations and winners this year thus the image from moonlight and the themes and the focus of some of those films which were amazing there may be some hope for possible change in a Hollywood universe it is encouraging to see real independent production as well as other forms of storytelling in a wide range of formats platforms at tatton technologies that can be more openly created and
shared we look forward to those new forms of cultural production that emerging and may emerge in the future the next step and here i didn't realize i would connect with one of the previous presentations which was so fantastic planet earth connecting us to our natural world perhaps we need to move from a Hollywood universe to a sustainable and open world of ideas stories and creativity I leave you with that thought and encourage you to continue imagining solutions thank you [Applause]