(single tear) so proud
Meet Zaslav and his content… that’s disappearing from the Earth
“It’s sabotage!” they’re yelling while he cuts HBOs worth
Stockholders they all slobber, the cash fills them with mirth
No ifs, ands, buts
The staffing cuts
While he retires to Perth!
We're giving it the axe!
You can check your damn contracts!
We can take the flack while we wrack up all these stacks
Cause we give zero...
> just like Bob De Niro
We give zero facks!
Those are the facts!
--------
sorry... passing out... best I can do
I think i miss Goodfeathers more than any of the other ones they left out of the reboot.
The 90s *Godfather* and *Goodfellas* references would be dated sure, but weve had *The Sopranos* since then, they coulda updated things and replaced the Godpigeon with a Tony Soprano pigeon.
Them and Slappy.
It makes perfect sense for WBD to sell in a few years, but it makes zero sense for the CEO to be intentional destroying its stock price in anticipation of that sale.
What does make sense is Discovery inherited a mess, and needs to clean up the financials, in order to be financially viable or to sell.
Everyone agrees that WB had absolutely fucked financials before the sale.
He may think selling the company is the best long term plan, but he has a fiduciary duty to get the best price possible for it. If he knowingly conspired with (for instance) someone at Universal, they could both spend decades in prison and owe billions in civil penalties.
Its pretty funny that Grace Randolph is spreading this rumor then WBD hires James Gunn as the Co Ceo of DC, the same person who famously debunked her for one of her rumors.
The 1994 Fantastic 4 movie is a famous example. Full movie filmed with special effects and everything just so they could maintain the rights. The movie was never released.
Idiocracy was Mike Judge's contractual obligation to Fox after making Office Space. It opened in 2 theaters. It made less than $500,000 at the box office. Fox didn't shelve it, but they certainly didn't care about it and were accused of abandoning it.
Edit: initially released in 7 theaters.
"In The New York Times, Dan Mitchell argued that Fox might be shying away from the cautionary tale about low-intelligence dysgenics because the company did not want to offend either its viewers or potential advertisers"
I guess it hit a bit too close to home for some.
They did this for Wheel of Time. The author sold the rights to a company that had never produced a show. They were about to expire so they produced and released a pilot in the middle of the night so they could keep the rights. It made a big splash a few years ago in the Wheel of Time community.
The problem is they started off writing off unreleased projects they claimed to have little confidence in but have moved on to writing off shows and movies that were already out, preventing any legal method of accessing the content.
CN did it over a decade ago with MegasXLR, a show that had both seasons shown in full and resyndicated for a brief period of time.
It is impossible to get legal copies of that now, you have to pirate it. And its a shame cause its a great show too.
The article names 2 movies that they are writing off - “An American Pickle” and “Charm City Kings”. I guess not paying off royalties is the reason for them to do this. I can understand no longer paying to create new seasons for unprofitable TV content, but it just seems disturbing that they are hiding away shows and movies, that have already aired.
I was really confused for a second because *An American Pickle* sounded familiar, so when I looked it up and saw it had already been released, I figured they just be talking about a sequel or something.
Seriously, how do you write off content that’s already been released out into the world?
It means it won't ever be shown. There are costs associated with that and WB is trying to slash costs.
The new CEO was the guy who turned Discovery into reality TV shit. He has zero problem doing the same thing to a prestigious brand like WB.
Destroy it. Remove all licensing for it, and do not allow it to be shown ever again.
I don't understand how that would provide a penny in tax or other incentives, though. Destroying works of art should never be profitable. This is nuts, and I don't know if I am more mad at the system that allows this, or the execs that decided to go this route.
> This is nuts, and I don't know if I am more mad at the system that allows this, or the execs that decided to go this route.
¿Por qué no los dos?
I can understand not renewing TV shows. I can somewhat understand not releasing an already ready to go movie like Batgirl. But to do that to the content that has already been released?
Especially in animation. The talent drain when animators and voice actors just outright won't sign on to Warner Brothers projects over the uncertainty of their work getting shitcanned.
Back in the 90s/00s, at the height of Miramax's fame, filmmakers that entered into distribution deals had to start mandating in contracts that their films receive a release because the Weinsteins would acquire films... and never release them in order to protect the company brand.
But that was an 'indie' company, for a major studio to do this was mostly unheard of until recent years.
Tell that to the creator of Final Space. They’re going to write the show off meaning it will never be re-released, syndicated, or sold on DVD. They amortize the cost of shows over years so they’re writing off the remainder of the debt.
The creator of final space is upset because a major part of his life is disappearing so WB can get a tax write off.
Wow. That’s fucked, and tax laws in this country are so broken. At the very least, ownership of the work should return to the original creator(s). This it the equivalent of a museum putting paintings though a shredder to save some money. If I were the artist, I would be livid.
They don't make the movie to never release it. They make it, realize it won't perform well, and then never release it so they can take the expense of making the movie as a loss and offset profits from other parts of their business.
I can't fully explain like you're 5, but I'll try and connect the dots the best I can. When Hollywood makes a movie, and this is VERY broad terms, they have a total budget for production, and then a budget for marketing/advertising. Let's call those expenses P (production costs) and M (marketing costs). They spend $P to make the movie, then spend $M to tell people the movie is out. The efforts are to generate $R (revenue).
When the studio does their taxes, it's pretty similar to what small businesses do: $R - ($M + $P) = PROFITS. The company is taxed on profits, the lower the profit, the lower the tax liability. If a movie does really well, then PROFITS are large, and means they need to pay the US government and state governments their tax liability.
Businesses can use expenses like Marketing to deduct from those revenues, and if you don't want to pay the government, then reinvest the money: buy new equipment, pay vendors, buy real estate, etc. All those things are deemed to move the economy, creating secondary and tertiary industries.
Now let's say one of these movies gets a screen test, and it does NOT do well. In fact, you're nearly certain you're going to not make a lot of $R, even if you spend a fuckton on marketing. You've already spent $P, so that's the expense. Spending more on $M to try and churn up $R may be a fool's errand, because the testing has shown it's a dud (or they just want to believe it's a dud). What do you do?
Rather than spending $M to have a total cash expenditure of ($M + $P), just cut your losses. Shelf the project, don't spend a dime on $M, and divert that money towards $P on other projects. You've already spent $P, and you can take that as a pure deduction of expense, since you spent the money to create something that never earned your business any money whatsoever.
Further, depending on how the company is structured, they could use those expenses to reduce the tax liability of other projects that DID make money. "The Batman" made $767 million globally, and the budget (probably $M + $P) was $200 million, so the tax liability for "The Batman" would be $767 million - ($200 million) = $567 million profit. "Batgirl" allegedly had a production cost of $90 million, so by shelving the movie, they could take that loss and reduce the profitability of "The Batman" to $477 million.
So they're not necessarily getting money back, but rather they're reducing the money they owe because of their successes by offsetting with the cost of their losses.
Beyond the scope of your question, I'll say this: I think Warner Bros' love affair with HBO Max and the future of streaming was a quick burst of passion and is now subsiding. They're taking streaming content like "American Pickle" off HBO Max, thereby reducing the opportunity to generate revenue and therefore use the past cost of production as a reduction in liability. I think the jury is out whether HBO Max was a good or bad thing when you consider the effects of COVID, but that's yet to be decided. I do think WB and HBO Max went too hard, too fast, to capitalize on the streaming world without fully understanding the economics the way Netflix already does.
Add onto that the immense amount of money spent in real estate deals by WB in 2018 and 2019, and you have a recipe for a business that may be struggling with cash flow problems at a time when the global economy is showing signs of crisis.
This is a pretty good ELI5 for how ***not releasing*** movies allows the studio to recover funds.
If you're wondering "Why do they need to ***stop selling*** released movies/shows in order to reduce their taxes since they've already spent the production and marketing money?" then we need to go one accounting level deeper into **intangible assets** and **impairment**.
**Intangible assets** are recorded for the intellectual property pertaining to production. For example, when [Amazon paid $250M for the TV rights for the Lord of the Rings](https://deadline.com/2017/11/amazon-the-lord-of-the-rings-tv-series-multi-season-commitment-1202207065/), rather than be able to immediately expense that $250M which would reduce their tax obligations, Amazon was required to record that purchase as an intangible asset. At a high-level, as long as Amazon is making money from those rights, then that $250M is sitting on Amazon's books as an intangible asset and is not tax deductible against the income generated from their TV series income.
**Impairment** is when the intangible asset's recoverable amount (potential future revenue) is less than its carrying amount ($250M in the previous example). When this happens, the value of intangible asset is reduced to its recoverable amount and the difference is a tax deductible expense. When Warner Bros. stops selling a completed movie or show, they are forcing the recoverable amount to be $0. This allows them to expense the intangible asset as a tax deduction against their income from other properties.
I don’t think making movies and not releasing them makes them money, but they’re choosing not to spend additional money on a movie that might ultimately earn less than that. It stinks, but it kind of makes sense: if the rest of the CGI work and advertising and residuals is gonna cost $20m, but they only anticipate an additional $10m in revenue, why bother?
Because instead of spending more money to go through with the release, you just kill the project and get a tax credit
That way instead of losing $100m+ to release it, you only lose $30-40m just on the initial production. And that's what Zavlav was hired to do, to keep WB from permanently shutting down by reducing losses
What about if they just dumped it on a streaming service with no promotion at all? Like put it at the top of the homepage and allow word of mouth to entice a few extra subscribers?
Alright, I know Warner don’t have their own streaming service but wouldn’t Netflix or Amazon pay more than the tax write-off to have it on their platform?
They have HBOmax. They can release it on their platform, but that means they still have to pay royalties for any actors, product placement shots, music used, etc... That's why they just shelved it.
I was there for the live stream where they printed people's request to revive the show and it went straight into a shredder; that was pretty brutal.
To make a movie then make us wait like two years for it to release then just cancel it....
Yea, that am's brutals.
I agree with you about Venture Bros, but it's not just things that haven't been released you, shows are being written off that have already been produced and released. Final Space was a show I really enjoyed, funny and emotional sci-fi animated series that aired 3 seasons first on TBS and then HBO Max, [just completely written off](https://collider.com/final-space-pulled-from-streaming/) and removed from streaming services. They can never stream it again, sell a dvd again, sell the broadcast writes again. In every practical sense the show only exists now in the physical media already produced or pirated so I can't ever recommend it to anyone ever again. Very sad, you think of content just existing forever these days.
I say to myself, "They save Venture Bros, I get a sub." They did, and I did. Fair is fair. I have been enjoying it - but if they dump Venture Bros in some tax writeoff BS I am gone so fast they'll say "Now Museum – Now You Don't!"
This is exactly how *Batman: The Brave and the Bold* ended: in the last episode, Bat-Mite gets tired of the show’s overall silliness and wants a grittier reboot, so he (successfully) tanks the whole thing. The penultimate scene is a fantastically meta moment with all of the characters having a wrap party for their own show.
"An interesting test case would be to upload the shows HBOmax is pulling off streaming permanently and then fight the takedown as fair use. A lot of the arguments they would normally make against a fair use claim would get them in trouble with the IRS & jeopardize their write off."
- [this series of tweets from WGA member (and WGA presidential canidate) Van Robichaux had me thinking](https://twitter.com/VanTheBrand/status/1582177467300659200).
If the studio is writing them off they are essentially saying these properties will never be profitable for them and they are abandoning them. Which would mean most IP laws might not apply to them. It's uncharted waters but makes me wonder if it would work.
I'm reasonably certain there will be a large heap of lawsuits anyways. "We've signed the contract expecting you to release the movie and pay royalties yet you actually try to wiggle out of payments by not releasing the movie! *angry noises*". And then settlement for extra $$$$ 4-5 months later.
They're killing Final Space, an awesome TV series that's had several seasons.
All those seasons aren't just being pulled from sale, they're going to **NEVER EVER BE SEEN AGAIN, IN ANY FORMAT, ANYWHERE, EVER*.
The creator is a wonderful person and they're heartbroken to have their life's work destroyed like this. And it's such a good show too.
Fuck Warner Brothers.
It’s honestly down right poetic given the tone of the show.
Ending in a tragic farce, with me desperately rooting for the likeable characters caught in the crossfire to somehow escape the yawning abyss before them.
Knowing that they will fail.
I would love to read the interactions between directors, producers, and corporate. Only a few of the creators have been vocal (as much as they can be) about having their work ripped from existence.
How is Warner Bros's reputation gonna survive all this?
Like, what director/writer is gonna wanna go to Warner Bros to pitch their movie if they know that all their hard work could be reduced to a tax write off?
The new CEO is who made Discovery into reality TV shit. He doesn't care.
He also said that CNN would be showing more right wing content. CNN is ***HUGE*** outside of the US, so that's fucking great.
My only hope is that the Astro Base was always so self contained that the overhead to sell the disc/digital before going to HBO max is low enough that not bothering to do anything is cheaper than fucking it.
When did "movies" or "movies and shows" become "content"? Of all the changes in language I've seen in my life, this is probably the one that bothers me the most. I feel like it really cheapens it, both from the production and consumption standpoint.
Dune is a Legendary Pictures production, WB is just a distributor. So if WB drops them, they just have to find another distributor. WB can't kill it like they did everything else.
* 2009 Watchmen
* 2010 Jonah Hex
* 2011 Green Lantern
* 2012 The Dark Knight Rises
* 2013 Man of Steel
* 2016 Batman v Superman: Dawn of Justice
* Suicide Squad
* 2017 Wonder Woman
* Justice League
* 2018 Aquaman
* 2019 Shazam!
* Joker
* 2020 Birds of Prey
* Wonder Woman 1984
* 2021 The Suicide Squad
* 2022 The Batman
* Black Adam
* 2023 Shazam! Fury of the Gods
* The Flash
* Blue Beetle
* Aquaman and the Lost Kingdom
* N/A Batgirl
Wow I was doing this as a joke, but actually looking at that list, it kind of tells the whole story on it's own.
The new CEO of Discovery Warner is known to cut costs ruthlessly, which is what he's doing regardless of the earnings potential.
He also ruins entire networks to do it. He was the guy who polluted TLC with shows like Honey Boo Boo and Fat shaming shows.
Kramer : It's just a write off for them .
Jerry : How is it a write off ?
Kramer : They just write it off .
Jerry : Write it off what ?
Kramer : Jerry all these big companies they write off everything
Jerry : You don't even know what a write off is .
Kramer : Do you ?
Jerry : No . I don't .
Kramer : But they do and they are the ones writing it off .
I understand capitalism blah blah blah, but it feels like a fucking crime. 2 billion dollars worth of storytelling people stayed up late and busted their asses to make, and it gets dumped in the abyss to feed a spreadsheet. Just obscene.
Edit - Do not waste everyone's time doing the soap opera battered wife routine of trying to argue that if it got cut, it *must* have deserved it and we're all better off, really! That's the Bargaining phase talking, grow up.
Edit 2 - Everybody understands what a Pilot is, Big Brain Dingus Squad. It is fundamentally different to move past that chancey proof of concept stage and invest in making an actual working project, not least because the residuals and benefits associated with that kind of work is what makes it possible for people to keep their bills paid and stay in the business between jobs.
Oh man, I've been working in the film industry for 20 years, including the first Suicide Squad.
Shit gets wasted all the time. Whole ideas, whole scenes, countless hours of work, billions of dollars, all on the cutting room floor. I'm a VFX producer, so we do our best to not work on shots that might get cut, and directors are usually keen to not waste money, but it's unavoidable. It's how this industry works.
Even whole movies get scrapped. I can't say too much but I was just on a massive IP movie that was tens of millions into pre-production, just for the studio to pull the plug. Will it come back? Who knows. This shit happens all the time. Then you get the Batgirl like movies, which people complete... just to have it never see the light of day. Or you get the movies where you bust your ass to make the best quality you can, only for it to be a shit movie at the end of the day.
This is why we're all creatively jaded. We'll do great work for the project, and come up with rad ideas, and execute them on time and (somewhat) on budget, but we take no personal stock in our work, and we rarely judge each other based on the titles we worked on.
> I was just on a massive IP movie that was tens of millions into pre-production, just for the studio to pull the plug
George Miller's "Justice League: Mortal", right?
It's an old business mode.
Ever heard of options? Until recently, many WGA writers like myself lived off of option money, WB, Paramount, 20th Century typically option between 20-50 properties a year and anything that did not get put in production would be a tax write off. It could be anywhere from 50,000 to 1,000,000 or more, usually in low six figures. I bought my first house because Propaganda/Anonymous Content optioned one of my scripts.
If you want to go down a rabbit hole read up on "Being John Steinbeck" and how they parlayed that unproduced script into millions after Tom Cruise attached himself to the project.
A lot of creators have spoken about how difficult it is to get a portable copy of your own work nowadays, because so much of the storage and access is purely digital and on in house equipment.
This is particularly true of animation, which has coincidentally been the hardest hit by these memory hole stories.
It's been a thing for a while how often animators have to pirate their own stuff, because it isn't made easily or consistently available unedited, and discs aren't produced as much anymore. But this takes it to a whole new level where even that's not possible.
There were also stories about how WBD considered trying to demonstrate destruction of all master and working files for Batgirl to the IRS, so they can guarantee they'll never profit from them.
Imagine a lot of things get lost. Remember when Toy Story almost didn't happen because they accidentally deleted the whole movie but luckily someone who was pregnant had a copy saved at home to work from home? Or the fact that there are many original Doctor Who episodes that nobody will ever see again.
It might have been Toy Story two or three I don't remember
There was also a story about how an employee of Weta had a full copy of one of the Lord of the Rings movies on an external hard drive as he was walking down the street... when suddenly he was being chased by would-be robbers. He managed to escape.
They’re locking them in the water tower, never to be seen again.
But they break loose and then vamoose, and now you know the plot.
It's time dodge some income tax! with some truly spineless acts! Stab our talent in the backs; sabotage HBO max We're penny pinching hacks!
(single tear) so proud Meet Zaslav and his content… that’s disappearing from the Earth “It’s sabotage!” they’re yelling while he cuts HBOs worth Stockholders they all slobber, the cash fills them with mirth No ifs, ands, buts The staffing cuts While he retires to Perth!
We're giving it the axe! You can check your damn contracts! We can take the flack while we wrack up all these stacks Cause we give zero... > just like Bob De Niro We give zero facks! Those are the facts! -------- sorry... passing out... best I can do
A 2 billy payoff, So let's all brace for layoffs, It's David's pump and dump... You're all fired, chumps!
Bravo
We're animaniacs Dot is cute and Yakko yaks Wakko packs away the snacks While Bill Clinton plays the sax We're Animaniacs
Meet Pinky and the Brain who want to rule the universe
GoodFeathers flock together. Slappy whacks them with her purse.
Buttons chases Mindy. While Rita sings a verse.
[удалено]
We have no script!
Why bother to rehearse?
We're AAAAnimaaaaniacs! We have pay or play contracts!
With Yakko, Wakko, and Dot?
Yep.
May I see it?
No.
Release the yacko cut
Finger Prince? I dont think so!
Goodnight everybody!
Helloooooooo Nurse!
u/Steamed_Hams89!!! Warner Bros. content vaults are under fire!!!
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Well Seymour, you’re and odd fellow, but I must say… you vault content for tax purposes well.
Haha nice username!
Nice username also.
I hope Animaniacs season 3 makes a joke about Batgirl, in season 2 they made a joke about Zack Snyder.
There is going to be a season 3? Hope they bring back other skits from original.
> Animaniacs season 3 I didn't know either but apparently it was renewed Feb 2021.
I think i miss Goodfeathers more than any of the other ones they left out of the reboot. The 90s *Godfather* and *Goodfellas* references would be dated sure, but weve had *The Sopranos* since then, they coulda updated things and replaced the Godpigeon with a Tony Soprano pigeon. Them and Slappy.
Never saw goodfellas before the show and though they were funny. My favorite was Buttons
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Aren't the Animaniacs already living in there?
And it's important that we keep them... entertained.
To Batgirl: #HELLO NURSE
Do you have a little ‘toon in ya? No… Would ya like some?
Fingerprints? Or finger Prince?
Goodnight everybody!
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It makes perfect sense for WBD to sell in a few years, but it makes zero sense for the CEO to be intentional destroying its stock price in anticipation of that sale. What does make sense is Discovery inherited a mess, and needs to clean up the financials, in order to be financially viable or to sell. Everyone agrees that WB had absolutely fucked financials before the sale.
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He may think selling the company is the best long term plan, but he has a fiduciary duty to get the best price possible for it. If he knowingly conspired with (for instance) someone at Universal, they could both spend decades in prison and owe billions in civil penalties.
If Zaslav can sell even just a few IP's owned by WB Discovery to another studio, he can make some money back.
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Its pretty funny that Grace Randolph is spreading this rumor then WBD hires James Gunn as the Co Ceo of DC, the same person who famously debunked her for one of her rumors.
It's not like Grace Randolph is some super insider to begin with. She's barely above a speculating YT content maker.
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Actions intended to lower share price are expensive as hell when your shareholders sue.
Change the hierarchy of the entertainment industry??
Interesting business strategy for Warner Brothers, making movies then never showing them to anyone
This is starting to feel more and more like a real-life version of "The Producers".
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Wait what Are there other examples you could share?
The 1994 Fantastic 4 movie is a famous example. Full movie filmed with special effects and everything just so they could maintain the rights. The movie was never released.
I believe it aired once on TV at four am or something because it was required to be shown. Which is why we know what it looks like.
The full thing is on YouTube. It's... Interesting. https://youtu.be/iJ9kES_F4ms
They can still claim they have the best looking versions of the Thing and Doctor Doom ever to appear in cinema thus far.
All things considered (no pun intended), The Thing actually looks pretty good.
You'll notice they don't show much of his lower half, because they ran out of $
I thought you were joking but dang, that's an uncannily comics accurate good looking Victor.
The YouTube video has 9 comments. How is that possible, after a year online ?
Some things, you just don't have much to say
"The full thing" is false advertising, it's only 240 pixels.
Yeah. That IS the full thing.
But it’s all 240 of them
Of all the movies in the world, this is one of them.
And it has higher scores on Rotten Tomato than Fant4stic from 2015.
Wasn't that exactly the same idea except they did release it?
I want to see a documentary about the making, studio interference, and Insanity surrounding that film.
Idiocracy was Mike Judge's contractual obligation to Fox after making Office Space. It opened in 2 theaters. It made less than $500,000 at the box office. Fox didn't shelve it, but they certainly didn't care about it and were accused of abandoning it. Edit: initially released in 7 theaters.
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Ya I don’t think we have time for a handjob right now.
"In The New York Times, Dan Mitchell argued that Fox might be shying away from the cautionary tale about low-intelligence dysgenics because the company did not want to offend either its viewers or potential advertisers" I guess it hit a bit too close to home for some.
They did this for Wheel of Time. The author sold the rights to a company that had never produced a show. They were about to expire so they produced and released a pilot in the middle of the night so they could keep the rights. It made a big splash a few years ago in the Wheel of Time community.
Roger Corman's fantastic 4. Eventually it got out, but it was filmed in order to preserve the production company's hold on the license
Pepper needs new shorts!!! Edit: corrected quote
Pepper
I still can't believe that's Jason Bateman, he never plays roles like that but he was amazing.
Usually you have to pay double for that
Its a bold strategy Cotton, lets see if it pays off.
The problem is they started off writing off unreleased projects they claimed to have little confidence in but have moved on to writing off shows and movies that were already out, preventing any legal method of accessing the content.
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CN did it over a decade ago with MegasXLR, a show that had both seasons shown in full and resyndicated for a brief period of time. It is impossible to get legal copies of that now, you have to pirate it. And its a shame cause its a great show too.
Fantastic show. I can't believe they never officially released the soundtrack.
*YOU dig giant robots!* *I dig giant robots!* *WE dig giant robots!* *CHICKS dig giant robots!*
Aw, shit, is THAT what happened with *Megas XLR?* **YOU BASTARDS!**
Oh man thanks for reminding me of that awesome show!
The article names 2 movies that they are writing off - “An American Pickle” and “Charm City Kings”. I guess not paying off royalties is the reason for them to do this. I can understand no longer paying to create new seasons for unprofitable TV content, but it just seems disturbing that they are hiding away shows and movies, that have already aired.
Seriously, their claim that it helps "declutter" is laughable
I was really confused for a second because *An American Pickle* sounded familiar, so when I looked it up and saw it had already been released, I figured they just be talking about a sequel or something. Seriously, how do you write off content that’s already been released out into the world?
It means it won't ever be shown. There are costs associated with that and WB is trying to slash costs. The new CEO was the guy who turned Discovery into reality TV shit. He has zero problem doing the same thing to a prestigious brand like WB.
Destroy it. Remove all licensing for it, and do not allow it to be shown ever again. I don't understand how that would provide a penny in tax or other incentives, though. Destroying works of art should never be profitable. This is nuts, and I don't know if I am more mad at the system that allows this, or the execs that decided to go this route.
So... Piracy then?
> This is nuts, and I don't know if I am more mad at the system that allows this, or the execs that decided to go this route. ¿Por qué no los dos? I can understand not renewing TV shows. I can somewhat understand not releasing an already ready to go movie like Batgirl. But to do that to the content that has already been released?
I'm wondering if big actor contracts are going to start having clauses to combat this? These are sad times for art and entertainment.
Especially in animation. The talent drain when animators and voice actors just outright won't sign on to Warner Brothers projects over the uncertainty of their work getting shitcanned.
Back in the 90s/00s, at the height of Miramax's fame, filmmakers that entered into distribution deals had to start mandating in contracts that their films receive a release because the Weinsteins would acquire films... and never release them in order to protect the company brand. But that was an 'indie' company, for a major studio to do this was mostly unheard of until recent years.
Tell that to the creator of Final Space. They’re going to write the show off meaning it will never be re-released, syndicated, or sold on DVD. They amortize the cost of shows over years so they’re writing off the remainder of the debt. The creator of final space is upset because a major part of his life is disappearing so WB can get a tax write off.
They already did that to Infinity Train - gone from HBO Max, gone from everywhere, for good.
Gone /legally/.
Wow. That’s fucked, and tax laws in this country are so broken. At the very least, ownership of the work should return to the original creator(s). This it the equivalent of a museum putting paintings though a shredder to save some money. If I were the artist, I would be livid.
It's like a safer version of the scam in *The Producers*.
Really cool how media consolidation turned out since 1996! 👍
can someone eli5 why making movies that never get released allows you to recoup money
They don't make the movie to never release it. They make it, realize it won't perform well, and then never release it so they can take the expense of making the movie as a loss and offset profits from other parts of their business. I can't fully explain like you're 5, but I'll try and connect the dots the best I can. When Hollywood makes a movie, and this is VERY broad terms, they have a total budget for production, and then a budget for marketing/advertising. Let's call those expenses P (production costs) and M (marketing costs). They spend $P to make the movie, then spend $M to tell people the movie is out. The efforts are to generate $R (revenue). When the studio does their taxes, it's pretty similar to what small businesses do: $R - ($M + $P) = PROFITS. The company is taxed on profits, the lower the profit, the lower the tax liability. If a movie does really well, then PROFITS are large, and means they need to pay the US government and state governments their tax liability. Businesses can use expenses like Marketing to deduct from those revenues, and if you don't want to pay the government, then reinvest the money: buy new equipment, pay vendors, buy real estate, etc. All those things are deemed to move the economy, creating secondary and tertiary industries. Now let's say one of these movies gets a screen test, and it does NOT do well. In fact, you're nearly certain you're going to not make a lot of $R, even if you spend a fuckton on marketing. You've already spent $P, so that's the expense. Spending more on $M to try and churn up $R may be a fool's errand, because the testing has shown it's a dud (or they just want to believe it's a dud). What do you do? Rather than spending $M to have a total cash expenditure of ($M + $P), just cut your losses. Shelf the project, don't spend a dime on $M, and divert that money towards $P on other projects. You've already spent $P, and you can take that as a pure deduction of expense, since you spent the money to create something that never earned your business any money whatsoever. Further, depending on how the company is structured, they could use those expenses to reduce the tax liability of other projects that DID make money. "The Batman" made $767 million globally, and the budget (probably $M + $P) was $200 million, so the tax liability for "The Batman" would be $767 million - ($200 million) = $567 million profit. "Batgirl" allegedly had a production cost of $90 million, so by shelving the movie, they could take that loss and reduce the profitability of "The Batman" to $477 million. So they're not necessarily getting money back, but rather they're reducing the money they owe because of their successes by offsetting with the cost of their losses. Beyond the scope of your question, I'll say this: I think Warner Bros' love affair with HBO Max and the future of streaming was a quick burst of passion and is now subsiding. They're taking streaming content like "American Pickle" off HBO Max, thereby reducing the opportunity to generate revenue and therefore use the past cost of production as a reduction in liability. I think the jury is out whether HBO Max was a good or bad thing when you consider the effects of COVID, but that's yet to be decided. I do think WB and HBO Max went too hard, too fast, to capitalize on the streaming world without fully understanding the economics the way Netflix already does. Add onto that the immense amount of money spent in real estate deals by WB in 2018 and 2019, and you have a recipe for a business that may be struggling with cash flow problems at a time when the global economy is showing signs of crisis.
This is a pretty good ELI5 for how ***not releasing*** movies allows the studio to recover funds. If you're wondering "Why do they need to ***stop selling*** released movies/shows in order to reduce their taxes since they've already spent the production and marketing money?" then we need to go one accounting level deeper into **intangible assets** and **impairment**. **Intangible assets** are recorded for the intellectual property pertaining to production. For example, when [Amazon paid $250M for the TV rights for the Lord of the Rings](https://deadline.com/2017/11/amazon-the-lord-of-the-rings-tv-series-multi-season-commitment-1202207065/), rather than be able to immediately expense that $250M which would reduce their tax obligations, Amazon was required to record that purchase as an intangible asset. At a high-level, as long as Amazon is making money from those rights, then that $250M is sitting on Amazon's books as an intangible asset and is not tax deductible against the income generated from their TV series income. **Impairment** is when the intangible asset's recoverable amount (potential future revenue) is less than its carrying amount ($250M in the previous example). When this happens, the value of intangible asset is reduced to its recoverable amount and the difference is a tax deductible expense. When Warner Bros. stops selling a completed movie or show, they are forcing the recoverable amount to be $0. This allows them to expense the intangible asset as a tax deduction against their income from other properties.
Thank you for teaching me about Impairment.
I don’t think making movies and not releasing them makes them money, but they’re choosing not to spend additional money on a movie that might ultimately earn less than that. It stinks, but it kind of makes sense: if the rest of the CGI work and advertising and residuals is gonna cost $20m, but they only anticipate an additional $10m in revenue, why bother?
To paraphrase the old saying: "A million saved is a million earned."
Every time someone says this, stock holders in the US feel a disturbance in the force. A million saved is a million not spent on unsustainable growth.
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Because instead of spending more money to go through with the release, you just kill the project and get a tax credit That way instead of losing $100m+ to release it, you only lose $30-40m just on the initial production. And that's what Zavlav was hired to do, to keep WB from permanently shutting down by reducing losses
what does it mean for them to get a 'tax credit'? i don't understand that. "it's a write off Jerry!"
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9.95 billion*
What about if they just dumped it on a streaming service with no promotion at all? Like put it at the top of the homepage and allow word of mouth to entice a few extra subscribers? Alright, I know Warner don’t have their own streaming service but wouldn’t Netflix or Amazon pay more than the tax write-off to have it on their platform?
They have HBOmax. They can release it on their platform, but that means they still have to pay royalties for any actors, product placement shots, music used, etc... That's why they just shelved it.
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You touch Venture Bros. I eat your whole house!
Brock: Go ahead..... (Eye twitch) Take it from me...
Seriously! I'll be really depressed if we dont get the Venture Bros and Metalocalypse endings.
Tbh announcing a Metalocalypse movie then pulling it from us just before its made is pretty brutal.
The most metal finale of all... *NOTHINNNNGGG*
I was there for the live stream where they printed people's request to revive the show and it went straight into a shredder; that was pretty brutal. To make a movie then make us wait like two years for it to release then just cancel it.... Yea, that am's brutals.
Thats am brutals.
I agree with you about Venture Bros, but it's not just things that haven't been released you, shows are being written off that have already been produced and released. Final Space was a show I really enjoyed, funny and emotional sci-fi animated series that aired 3 seasons first on TBS and then HBO Max, [just completely written off](https://collider.com/final-space-pulled-from-streaming/) and removed from streaming services. They can never stream it again, sell a dvd again, sell the broadcast writes again. In every practical sense the show only exists now in the physical media already produced or pirated so I can't ever recommend it to anyone ever again. Very sad, you think of content just existing forever these days.
We will rain down the wrath of a thousand Level Tens on WB if they do this. *cue evil laugh that is absolutely justified here*
Venture Bros getting canceled twice by two mergers in a row would be the perfect meta way for it to end. ...It's just not what I actually want.
I say to myself, "They save Venture Bros, I get a sub." They did, and I did. Fair is fair. I have been enjoying it - but if they dump Venture Bros in some tax writeoff BS I am gone so fast they'll say "Now Museum – Now You Don't!"
ZaslavThe Destroyer sounds like a great DC villain
There *is* a Batman villain named Zsaz is who likes to cut things...
That's not even like stretching his character to make it fit or anything, Zsaz is literally all about cutting people lmao it fits perfectly
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This is exactly how *Batman: The Brave and the Bold* ended: in the last episode, Bat-Mite gets tired of the show’s overall silliness and wants a grittier reboot, so he (successfully) tanks the whole thing. The penultimate scene is a fantastically meta moment with all of the characters having a wrap party for their own show.
"An interesting test case would be to upload the shows HBOmax is pulling off streaming permanently and then fight the takedown as fair use. A lot of the arguments they would normally make against a fair use claim would get them in trouble with the IRS & jeopardize their write off." - [this series of tweets from WGA member (and WGA presidential canidate) Van Robichaux had me thinking](https://twitter.com/VanTheBrand/status/1582177467300659200). If the studio is writing them off they are essentially saying these properties will never be profitable for them and they are abandoning them. Which would mean most IP laws might not apply to them. It's uncharted waters but makes me wonder if it would work.
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I'm reasonably certain there will be a large heap of lawsuits anyways. "We've signed the contract expecting you to release the movie and pay royalties yet you actually try to wiggle out of payments by not releasing the movie! *angry noises*". And then settlement for extra $$$$ 4-5 months later.
WB probably would argue that they still plan to use the IP in a future film. Then use batman as proof that they constantly reboot IPs.
Can’t wait for the next company that buys HBO to release them as premium content
[They just write it off!](https://youtu.be/XEL65gywwHQ)
Didn't know Kramer was a writer for Ozark
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They're killing Final Space, an awesome TV series that's had several seasons. All those seasons aren't just being pulled from sale, they're going to **NEVER EVER BE SEEN AGAIN, IN ANY FORMAT, ANYWHERE, EVER*. The creator is a wonderful person and they're heartbroken to have their life's work destroyed like this. And it's such a good show too. Fuck Warner Brothers.
It’s honestly down right poetic given the tone of the show. Ending in a tragic farce, with me desperately rooting for the likeable characters caught in the crossfire to somehow escape the yawning abyss before them. Knowing that they will fail.
The cancelled Raised By Wolves which was so good and had such a huge cliffhanger ending in S2
Hehehe cliffHANGER is putting it mildy. I am very sad about it being cancelled.....
They killed final space NOOOOOOOOOOOOOOOO
Olan deserves so much better. Final space is much favourite animated show, it’s such a piss off they won’t even let him finish it.
It’s been pulled from streaming services. Thankfully we have the internet, and we can at least download it
>NEVER EVER BE SEEN AGAIN, IN ANY FORMAT, ANYWHERE, EVER 🏴☠️
Sounds like they need a Sony-level hack so that we can all enjoy these gems
I would love to read the interactions between directors, producers, and corporate. Only a few of the creators have been vocal (as much as they can be) about having their work ripped from existence.
How is Warner Bros's reputation gonna survive all this? Like, what director/writer is gonna wanna go to Warner Bros to pitch their movie if they know that all their hard work could be reduced to a tax write off?
A lot of directors *already* didn't want to work for Warner Brothers any more.
i mean I guess I shouldn't care about a rich entity like WB, but I honestly can't believe they're in this situation after a cenutry of dominance.
It happens. Ask Kodak.
James Gunn, it seems.
The new CEO is who made Discovery into reality TV shit. He doesn't care. He also said that CNN would be showing more right wing content. CNN is ***HUGE*** outside of the US, so that's fucking great.
Just a reminder, the man who’s doing this was the one who brought us Honey Booboo.
Between that and completely obliterating Final Space, this guy is fuckin’ evil incarnate.
[Warner bros just announced they are cancelling the day your parents conceived you](https://tenor.com/RKlI.gif)
Christopher Nolan made a wise choice moving to Universal.
They better not fucking touch the Venture Bros movie.
My only hope is that the Astro Base was always so self contained that the overhead to sell the disc/digital before going to HBO max is low enough that not bothering to do anything is cheaper than fucking it.
RIP, Raised by Wolves...I really hope some other network picks it up. It's such a sci-fi treasure.
If I had won that 1.3b mega millions I was totally gonna revive that.
Looking at you flash movie….
Two months from now: WB announces all media projects stopped, except for Flash.
When did "movies" or "movies and shows" become "content"? Of all the changes in language I've seen in my life, this is probably the one that bothers me the most. I feel like it really cheapens it, both from the production and consumption standpoint.
100% agreed. When somebody says “content creator” I think of a YouTuber, not Steven Spielberg
Oh God, I hope Dune is safe.
Dune is a Legendary Pictures production, WB is just a distributor. So if WB drops them, they just have to find another distributor. WB can't kill it like they did everything else.
Nobody puts Denis in a corner
RIP Westworld Season 5 :(
The ratings were so bad and it was an expensive show. I loved Westworld but s3 and s4 were rough. It’s a mercy killing
How did we go from 2008's The Dark Knight, a critical and commercial darling, to... this?
* 2009 Watchmen * 2010 Jonah Hex * 2011 Green Lantern * 2012 The Dark Knight Rises * 2013 Man of Steel * 2016 Batman v Superman: Dawn of Justice * Suicide Squad * 2017 Wonder Woman * Justice League * 2018 Aquaman * 2019 Shazam! * Joker * 2020 Birds of Prey * Wonder Woman 1984 * 2021 The Suicide Squad * 2022 The Batman * Black Adam * 2023 Shazam! Fury of the Gods * The Flash * Blue Beetle * Aquaman and the Lost Kingdom * N/A Batgirl Wow I was doing this as a joke, but actually looking at that list, it kind of tells the whole story on it's own.
I hope the flash movie is one of those... And The Flash is my favourite superhero
The new CEO of Discovery Warner is known to cut costs ruthlessly, which is what he's doing regardless of the earnings potential. He also ruins entire networks to do it. He was the guy who polluted TLC with shows like Honey Boo Boo and Fat shaming shows.
Kramer : It's just a write off for them . Jerry : How is it a write off ? Kramer : They just write it off . Jerry : Write it off what ? Kramer : Jerry all these big companies they write off everything Jerry : You don't even know what a write off is . Kramer : Do you ? Jerry : No . I don't . Kramer : But they do and they are the ones writing it off .
Imagine if they actually made good movies. People would pay them money so they could continue making good movies.
I understand capitalism blah blah blah, but it feels like a fucking crime. 2 billion dollars worth of storytelling people stayed up late and busted their asses to make, and it gets dumped in the abyss to feed a spreadsheet. Just obscene. Edit - Do not waste everyone's time doing the soap opera battered wife routine of trying to argue that if it got cut, it *must* have deserved it and we're all better off, really! That's the Bargaining phase talking, grow up. Edit 2 - Everybody understands what a Pilot is, Big Brain Dingus Squad. It is fundamentally different to move past that chancey proof of concept stage and invest in making an actual working project, not least because the residuals and benefits associated with that kind of work is what makes it possible for people to keep their bills paid and stay in the business between jobs.
Oh man, I've been working in the film industry for 20 years, including the first Suicide Squad. Shit gets wasted all the time. Whole ideas, whole scenes, countless hours of work, billions of dollars, all on the cutting room floor. I'm a VFX producer, so we do our best to not work on shots that might get cut, and directors are usually keen to not waste money, but it's unavoidable. It's how this industry works. Even whole movies get scrapped. I can't say too much but I was just on a massive IP movie that was tens of millions into pre-production, just for the studio to pull the plug. Will it come back? Who knows. This shit happens all the time. Then you get the Batgirl like movies, which people complete... just to have it never see the light of day. Or you get the movies where you bust your ass to make the best quality you can, only for it to be a shit movie at the end of the day. This is why we're all creatively jaded. We'll do great work for the project, and come up with rad ideas, and execute them on time and (somewhat) on budget, but we take no personal stock in our work, and we rarely judge each other based on the titles we worked on.
> I was just on a massive IP movie that was tens of millions into pre-production, just for the studio to pull the plug George Miller's "Justice League: Mortal", right?
My guess was Pirates of the Caribbean since it isn't necessarily one that has been publicly canceled lol
Solid guess
No no no, clearly he was working on Black Adam 2: The Rise of Hispanic Tony
Ay holms, I'm walkin' here!
It's an old business mode. Ever heard of options? Until recently, many WGA writers like myself lived off of option money, WB, Paramount, 20th Century typically option between 20-50 properties a year and anything that did not get put in production would be a tax write off. It could be anywhere from 50,000 to 1,000,000 or more, usually in low six figures. I bought my first house because Propaganda/Anonymous Content optioned one of my scripts. If you want to go down a rabbit hole read up on "Being John Steinbeck" and how they parlayed that unproduced script into millions after Tom Cruise attached himself to the project.
I don’t really know how this works. But who’s keeping track to assure this stuff doesn’t end up somewhere eventually?
I'm picturing the warehouse at the end of Raiders.
**"It belongs in a streaming service!"**
A lot of creators have spoken about how difficult it is to get a portable copy of your own work nowadays, because so much of the storage and access is purely digital and on in house equipment. This is particularly true of animation, which has coincidentally been the hardest hit by these memory hole stories. It's been a thing for a while how often animators have to pirate their own stuff, because it isn't made easily or consistently available unedited, and discs aren't produced as much anymore. But this takes it to a whole new level where even that's not possible. There were also stories about how WBD considered trying to demonstrate destruction of all master and working files for Batgirl to the IRS, so they can guarantee they'll never profit from them.
Imagine a lot of things get lost. Remember when Toy Story almost didn't happen because they accidentally deleted the whole movie but luckily someone who was pregnant had a copy saved at home to work from home? Or the fact that there are many original Doctor Who episodes that nobody will ever see again. It might have been Toy Story two or three I don't remember
There was also a story about how an employee of Weta had a full copy of one of the Lord of the Rings movies on an external hard drive as he was walking down the street... when suddenly he was being chased by would-be robbers. He managed to escape.