Morgan Stanley
  • Now, What's Next? Podcast
  • May 12, 2021

Back to the Big Screen

Transcript

Sonari Glinton:

Hello. Sonari Glinton, and I'm walking down Hollywood Boulevard to begin our new season of Now, What's Next, an original podcast from Morgan Stanley. Welcome.

Sonari Glinton:

We're starting at Hollywood Boulevard because it's not that far away from my house. After doing a year of interviews and recording podcasts from my apartment, I thought it would be really good to get back out in the world again.

Sonari Glinton:

I'm standing here on William Friedkin's star in front of Sid Grauman's Chinese Theater in the middle of downtown Hollywood, which is kind of like New York's Times Square. It's just smaller and probably weirder. There's jugglers. You might hear the world's worst drummer occasionally. There's always people...

 

Right now there are tourists walking up and down the street, taking photos of their favorite stars. There's usually a Spider-Man or Wonder Woman impersonator, as always, trying to take a picture with you. I'm right down the street from the Dolby Theater, where they usually present the Oscars. It's also where they hold a ton of movie premiers. The last time I was here was actually to see The Avengers: Infinity War.

Sonari Glinton:

Normally for big premiers, they close off the middle of the street, roll out the red carpet. There's usually a big tent with tons of reporters and fans. The last time I was here, I saw Angela Bassett wearing a beaded white suit with her hair in a blowout, just like Diana Ross in the '70s. It stopped tons of people dead in their tracks. You got to love Hollywood.

Sonari Glinton:

The Avengers premiere was in January of 2018, but it feels really like yesterday. It also feels like a crazy pre-pandemic dream. Today, there's still the Spider-Man dude here. There's a woman who's watching me recording. But this could be any weird downtown area anywhere. What makes Hollywood special, though, is the movies.

Sonari Glinton:

The movies are slowly getting back into business. Cinemas are reopening again. But while the screens were dark, a whole lot has changed. From the theaters fighting to stay alive ...

Shelli Taylor:

We've laid off a majority of our team in theaters, behind the scenes. It is very scrappy, to save as much or conserve as much money as possible.

Sonari Glinton:

To rethinking which movies get made and who makes them ...

Cameron Bailey:

It's not a very diverse crowd of people who are making the big decisions. This is not news. Everybody in the film world knows this, right?

Sonari Glinton:

To, who are the new power players?

Vicky Ding:

People are starting to pay attention to Chinese cinema.

Sonari Glinton:

This season on Now, What's Next, we're looking for scenes of rebirth and change. We're focusing on the same old problems, problems that have been exposed or possibly made worse by this global pandemic, from daycare to shopping malls, colleges to nursing homes. We're meeting folks who are trying to reimagine a better future.

Sonari Glinton:

Right now, because I'm in Hollywood where people dream for a living, let's go find some folks who are dreaming up solutions to our current problems. Let's start with the movies, of course.

Speaker 1:

Quiet on set. And action.

Shelli Taylor:

I didn't tell my parents, because they would have been like, "Oh, no, you don't."

Sonari Glinton:

That's Shelli Taylor. Just over a year ago, she started a job that all of a sudden got a lot more difficult.

Shelli Taylor:

Everyone asked if I was crazy, and I said, "Yes. I'm clearly crazy." But, at the same time, this will pass.

Sonari Glinton:

Just to be clear, I am taking the job as a CEO of a theater chain during a pandemic.

Shelli Taylor:

A pandemic. Yes, yes, and yes. Absolutely crazy.

Sonari Glinton:

Shelli Taylor is not crazy, but she did walk into a really bizarre situation when she became the CEO of Alamo Drafthouse, which is a movie theater restaurant chain, just weeks after the pandemic temporarily closed all their locations.

Shelli Taylor:

I don't think anyone believed it would last that long. Two or three months, and we'd be back to normal. The feelings were nervous, and then truly didn't believe it could ever take this long.

Sonari Glinton:

She's taken big risks before. Her dad thought she was nuts when she went to work for Starbucks in the '90s. You didn't have to go to college to work at a coffee shop, he said. Eventually Shelli took Starbucks to China, and then moved on to Disney and Planet Fitness.

Sonari Glinton:

When you think about your first CEO role, nobody hires a CEO because they want them to "hold on" to the business.

Shelli Taylor:

No.

Sonari Glinton:

Shelli's experience expanding companies is why she got her first CEO gig running Alamo Drafthouse. Pre-pandemic, they were a success story in a declining industry. Alamo was actually growing and opening new theaters with their mix of super local food, and high quality movies, and cool events. Then COVID entered the scene.

Sonari Glinton:

2020 turned out to be the worst year ever for movie theaters. Ticket sales dropped 80% while streaming services such as Disney+, Hulu, and Netflix ate their lunch. AMC Theaters lost nearly $5 billion, and came close to bankruptcy.

Sonari Glinton:

With Alamo Drafthouse, Shelli and her team tried to find ways to keep the movie magic alive. For instance, they promoted a streaming site with specially curated movies. They offered curbside food pickup. Like many of us, they found themselves on Zoom, organizing Zoom cast reunions for Lord of the Rings and Dazed and Confused. When they finally began reopening theaters, it was at reduced capacity.

Shelli Taylor:

Then the hard realities of business, which have been so incredibly painful, is we've laid off a majority of our team in theaters that are not open, but as well as in our support center. Then minimized every account, every everything behind the scenes so that we're providing the experience, but there's really, behind the scenes, it is very scrappy, to save as much or conserve as much money as possible.

Sonari Glinton:

In March, 2021, Alamo Drafthouse filed for chapter 11 bankruptcy protection with Shelli Taylor less than a year into her job.

Shelli Taylor:

Messed up as this has been, in some ways the pandemic allows us to start from scratch and to really look at our business from a clean sheet of paper. How do we want to continue?

Sonari Glinton:

Shelli thinks that something is happening around the industry, and here's an example. Until the pandemic, studios and theaters had a rule. A new movie had to play in theaters for at least 90 days. Then, and only then, after that 90 days, could it be released to streaming. That's essentially how theaters made money.

Sonari Glinton:

But the pandemic completely obliterated that rule. Some movies, like Wonder Woman 1984, came out in theaters and was released to streaming at the same time. Shelli thinks the movie got shortchanged.

Shelli Taylor:

That movie was meant to be seen in a big cinematic experience. If they watch it on their phone, or iPad, or at home, it's not the same experience, and that's what was getting reviewed. That was just not ... It just wasn't fair, and it shortchanged the movie.

Sonari Glinton:

You only talk about the genie when it's out of the bottle, and this genie is definitely out of the bottle. It's unlikely we're ever going to go back to the old system. Shelli hopes there won't be, though, a one-size-fits-all release for movies in the future.

Shelli Taylor:

My hope for the industry is that we wouldn't get stuck on a number, but what we would think about is, what does that movie deserve? How should it be best shown? Some movies, maybe they go to the theater for a week or less, and then they go to streaming. But others, they deserve the time on the big screen.

Sonari Glinton:

Will folks who got used to streaming new releases be reluctant to go back to the movies? Shelli thinks ...

Shelli Taylor:

That's just not true. I think that content is content, and the way in which people consume content is-

Shelli Taylor:

And the way in which people consume content is forever going to evolve. But when I look into the future, people are not standing in line for a vaccine to stay home. That is super clear. People are getting vaccines because they want to get back out and have experiences, be social, be human again.

Sonari Glinton:

And Shelli thinks going to movies is still relevant.

Shelli Taylor:

There will be nothing like sitting inside an auditorium with 50 to 200 people, having a shared experience, big cinematic experience, watching a movie, and a movie that changes you. And then when I think about the movie that just blew my socks off, where I walked out of the cinema moved and thinking I could be a different human being was the first Star Wars movie. And wrapping my hair up into buns on either side to be princess Leia and practicing mind tricks, or thinking I was. All of us kids that saw Star Wars, that first experience in the movies, we still talk about it. It connects us and it spurs the excitement to go back to the movies.

Sonari Glinton:

And Shelli's watching what's going on in places where the virus is under control and movies are back in business. Think China. A movie making Mecca we'll visit later on this episode.

Shelli Taylor:

The box office is just exploding there. But as people are going, the question is going to be yes, there's great content, but what's the experience? The biggest risk we face, in my mind, as a cinema is poor service and poor experience. And as long as we continue to provide just the best experience, best reason to go out, we're going to have plenty of business.

Sonari Glinton:

But the business has changed. Shelli predicts we'll see fewer Megaplexes and more medium or small theaters. And then there's this game changer, and it's accounted for about 50% of Alamo's revenue over the pandemic. Going to say it slowly. Think about this. Private theater rentals.

Shelli Taylor:

So over the holidays, I rented a theater to see Love Actually, so a rep film, but it's my favorite Christmas film. I watch it every year. And invited my group of friends and was able to have a really cool party in a safe way at Christmas. And so I think that hadn't been available or had been very limited prior to the pandemic, and we're seeing incredible success. And that's a long-term experience that we'll innovate against.

Sonari Glinton:

Now this makes me want to rent a private theater and explain to people why Cool Hand Luke is the best movie ever.

Shelli Taylor:

Well, here's the deal. When we reopen our theater in LA at the block, I'm going to call you and we'll go see that together or another movie and get back into the business of seeing movies.

Sonari Glinton:

All right, I'm all in. But I can't help but wonder, how are the movies themselves changing after this most unprecedented year?

Cameron Bailey:

I was born in England, left England when I was four years old. Went to Barbados and lived in essentially the back of beyond on a farm with my grandparents. We didn't have movie theaters where I was. They existed in Barbados, but I never saw a movie until probably eight, nine years old in a movie theater.

Sonari Glinton:

That's Cameron Bailey.

Cameron Bailey:

I'm the artistic director and the co-head of the Toronto Film Festival and the TIFF organization. I've been working in movies for over 30 years.

Sonari Glinton:

But Cameron's first vivid movie memory is a classic.

Cameron Bailey:

It's playing at some old rickety drive in and we kind of had to hide in the back of the car, because I wasn't old enough to see Jaws at that point. But we wanted to all go see it, and I remember being terrified at that movie, watching it on the big screen from the inside of our car with no water around, but still terrified. And that's kind of when I knew what movies could do.

Sonari Glinton:

Cameron's been figuring out what movies can do ever since. Now for those outside of Hollywood, you might not get the importance of the Toronto International Film Festival.

Cameron Bailey:

We're the biggest public film festival in the world, so in a normal year when we don't have a pandemic, we have about a half a million people who attend our screenings and events every year.

Sonari Glinton:

The festival, affectionately known as TIFF, has become a predictor of sorts.

Cameron Bailey:

American Beauty won our audience award in 1999 and that was maybe one of the first times that Hollywood kind of sat up and took notice of our festival as kind of a bellwether for award season. But many other films, Slumdog Millionaire, many others that have gone on to Oscar victory started at our festival as well.

Sonari Glinton:

A bellwether, not just for award season, but for the box office as well. In the last two decades, films that won TIFF's people's choice awards made $3 billion globally. Now that's not just serendipity, there's a lot of consideration behind what gets picked to screen at TIFF. And Cameron and his team watch thousands of movies every year.

Cameron Bailey:

There's a lot of movies that are just a basic level of good that could work at our festival, but we can't choose all of those. So even among the good movies, we have to make some very hard decisions about which ones we invite. And then also once we've invited the films about how we're going to position them.

Sonari Glinton:

I wonder about you in your role. It's like in many ways you were born for this moment, right? I mean, how do you see yourself changing in this last year, pandemic and racial almost awakening?

Cameron Bailey:

Yeah. Well, it's complicated, I guess is the short answer. It's almost like a veil was lifted or something, because a lot of the things that were quiet or even silent suddenly were very loud. I'm always aware of myself as a Black man in this role and in this industry. It was not a very diverse crowd of people who are making the big decisions. This is not news, everybody in the film world knows this, right? So as one of a fairly small number, a too small number, I'm aware of how those decisions that I make about what films we invite, about what filmmakers we decide to really get behind, how that all matters.

Sonari Glinton:

To get a sense of what he means, I want to take you back to the 2009 Sundance Film Festival in a screening of a movie called Precious. When it ended, Cameron...

Cameron Bailey:

Was just euphoric. It's a tough movie to watch for some people. It's definitely about trauma, but it is, I thought so well directed and performed that I wanted to invite it right on the spot.

Sonari Glinton:

He starts negotiating to bring it to Toronto to give it the biggest audience possible.

Cameron Bailey:

That was when I felt like if I wasn't in this role, and at that time I was I think co-director of the festival. If I wasn't in this role as a Black man, that would not be happening.

Sonari Glinton:

Why is that?

Cameron Bailey:

I think if it wasn't me at that particular moment, if somebody else might've said, oh, it's a good movie. It's all right. Maybe we'll take it, maybe we won't for Toronto, but it was much more powerful, much more visceral for me. Suddenly just comes to mind, Billie holiday singing Strange Fruit, it's intense, it's painful, it's powerful, but it's necessary. And that's how I felt about Precious.

Sonari Glinton:

And when it came to the festival.

Cameron Bailey:

This is going to be Tyler Perry and Mariah, and Mary J. Blige and Oprah and everybody coming to Toronto to our biggest theater, the Roy Thompson Hall. 2000 people, big red carpet. My own mother, my late mother was there and I got the opportunity to introduce her to Oprah and that was a dream come true for her. She was one Black woman among many in the room that night, but it meant a lot to have that space, the biggest, most prestigious space in our city, during the festival be taken over by Black talent. That meant a lot.

Sonari Glinton:

All right, so Precious one TIFF's audience award and then went on to win two of the six Oscars it was nominated for, team Monique forever. It also brought in more than $63 million on a $10 million budget, and it was said to over-perform. A term that is often used when a film by a person of color hits big at the box office, which happens all the time.

Cameron Bailey:

Then that annoying word over performs has been part of Hollywood history for decades, because people are surprised when audiences go out to see a movie with Black people in it. And I don't know how you can be surprised for your whole career by the same thing happening over and over-

Cameron Bailey:

... whole career by the same damn thing happening over and over and over again.

Sonari Glinton:

Earlier this year, McKinsey Consulting released the report. Hollywood is losing $10 billion a year. That's $10 billion because it ignores minority audiences. In particular it found projects led by black talent were systematically undervalued despite their amazing return on investment. But will the film industry do anything about it permanently?

Cameron Bailey:

Change is not a straight line. It is not an upward path to progress, right? That does not happen. Let me take one example. There's a Canadian film that we showed called The Body Remembers When the World Broke Open, directed by a couple of filmmakers, both women, one indigenous, one not, Elle-Máijá Tailfeathers and Kathleen Hepburn. It's a small, low budget film but super smart and very powerful emotionally. Ava DuVernay's company bought that film and suddenly she's out there bigging that movie up, talking to people about it, more people are seeing it, and that affects the lives of indigenous women because that's who's on screen in that movie. People watch that film. They have a much deeper, richer understanding of what the life of an indigenous woman in contemporary North America might be like. The risk, the danger, the things that they're dealing with. And that actually increases empathy, increases understanding. It also allows these artists to make more work and to sustain careers because too many people burn out or can't continue, but I think on a very basic level, it allows more people who are too often erased or unseen to be seen.

Sonari Glinton:

When he says that I'm thinking of last year just before the pandemic hit, I got the chance to attend the Black Film Critics Awards. Now the Korean film, Parasite, got multiple and I mean multiple extended emotional standing ovations and it won almost every award. I said that night, it felt like the blackest movie I've ever seen, but I couldn't quite figure out why. So I asked Cameron who started off acknowledging, "Well, it's a masterful film."

Cameron Bailey:

But I think there is also something that's powerful about just kind of taking a bit of a break. Like just taking a breath from always putting the effort in to enter a white story. We all grew up with that. It becomes second nature to us, right? We identify with white protagonists, white heroes, white villains, because that's what we mostly see. And so I think there is something that even if it's not your own culture and your own particular background, that if it's not the dominant culture, it just feels like, oh yeah, I'm ready because I'm not getting enough of that.

Cameron Bailey:

But then I think Parasite is so sophisticated about class, about what it's like to have nothing, to be scrambling for wifi and all of that kind of stuff. Black people I think understand that. And there's some black people who are lucky enough to understand what it's like to go from one to the other, to really cross the river from poor to rich and to understand how you can also slip from rich to poor, right? And that dynamic is something that I think any marginalized group understands well that wherever you are right now in society, it's precarious. Do you know what I mean?

Sonari Glinton:

Actually, I do. In the middle of all this turmoil, Cameron sees hope in stories like Parasite and Precious and The Body Remembers When the World Broke Open. And to be honest, in streaming.

Cameron Bailey:

Yeah, I think the pandemic is accelerating things because we've all been at home for a year watching stuff on our TVs for the most part, mostly from streaming services. That's accelerating things, but it was already underway.

Sonari Glinton:

Cameron points to an independent film called [inaudible 00:22:00] about a group of Arab women in Paris. Netflix bought it, which meant people in 192 countries around the world could see it.

Cameron Bailey:

And that I think is the game changer. But when those personal stories resonate enough and they have the opportunity to go all around the world and you have people in Mexico watching Korean melodramas, that kind of thing, all of a sudden you begin to see a whole new world. We don't all have to consume the same thing.

Sonari Glinton:

You can begin to imagine a whole new world. For so long, Hollywood has been the center of the movie world and we've slowly, I mean too slowly begun to acknowledge the other woods around the globe, Bollywood, Nollywood, Ollywood in East Asia. Now thanks to the pandemic, other countries are getting their close-up.

Vicky Ding:

Well, I think the very first time that I have a strong memory to film is when I was like eight or nine year old watching Titanic at home with my parents.

Sonari Glinton:

Vicky Ding grew up in Beijing, China, and today she sells Chinese films internationally through her company, Blossoms Entertainment. But Vicky's first movie memory is pure Hollywood.

Vicky Ding:

And the scene that I'll remember forever is when the ship's sinking gradually to the ocean. It really strikes me because I've never seen something like this.

Sonari Glinton:

For children like Vicky who grew up in the '90s, Titanic was a generation defining Hollywood blockbuster. It was also a massive hit. It broke Chinese box office records in 1998. And when the 3D version of Titanic came out in 2012, hearts went on. Chinese audiences flooded theaters. The opening weekend box office more than doubled the US numbers. Back then in 2012, film industry experts were saying it was only a matter of time before China eclipsed North America as the biggest movie market. Fast forward to 2020, Vicky started Blossoms Entertainment just as theaters in China reopened in July.

Vicky Ding:

And there was a capacity of 50% or 25%. You can bring any food or beverage into theater and you have to wear masks throughout the film. And the very first blockbuster new title came into the theater is The Eight Hundred. And well, it froze the highest box office last year in China and internationally.

Sonari Glinton:

Let's think about that for a moment. For the first time China was behind the highest grossing film in the world. It's called The Eight Hundred. It's a film Vicky's company sold to buyers in Europe, the Middle East, and Africa. The Eight Hundred is an epic historical film set in 1937 in Shanghai. A Chinese battalion of soldiers defends a warehouse against the invading Japanese army. Think Saving Private Ryan or Pearl Harbor. Lots of special effects, incredibly loud, and shot entirely in a giant IMAX format, [inaudible 00:25:23] China.

Vicky Ding:

So it's heavily on the special effect and also with the production budget that some Hollywood titles couldn't really reach. So I think yeah, from the box office side and also from the investment side, it really shows that China is becoming or is on the way to become the largest market in the world.

Sonari Glinton:

Between those two poles of Vicky's life and movies, Titanic and The Eight Hundred, there's a lot of ground to cover, but I'll go out on the limb and say a lot of us don't even know where to start. That's what Vicky discovered when she left Beijing to go to film school at the University of Southern California in 2012.

Vicky Ding:

Well, I think it really shocked me that even starting at a film school and a prestigious film school, my cohorts were not interested in Chinese cinema alone. Scholars who study international cinema don't really care about Chinese cinema. And I felt no one knows what it's showing in China.

Sonari Glinton:

And when they did know something...

Vicky Ding:

People will first remember all those classic titles in '80s, which is really a... How can I say that? It's like, well, we call it like fifth generation of Chinese directors.

Sonari Glinton:

Did you catch that? Fifth generation. Now, it shouldn't be a surprise that China like many places in the world has a long and rich film history. If I asked you to name five Chinese actors, films, or directors that aren't Bruce Lee, Jet Li-

Sonari Glinton:

Five Chinese actors, films, or directors that aren't Bruce Lee, Jet Li, Jackie Chan, or the recent Oscar winner, Chloe Zhao. [inaudible 00:27:08] Vicky wants that to change.

Vicky Ding:

I chose to do international sales for Chinese titles because I think that's my personal mission because I really want to introduce good Chinese titles to the world.

Sonari Glinton:

Before she started Blossoms, Vicki sold one of 2019's biggest movies, The Wandering Earth, to Netflix. It's a Chinese sci-fi special effects extravagance.

Vicky Ding:

We are so used to watch something from The States in terms of space story, the story happening the space like Gravity or Interstellar, but we really want to see something original from China. So The Wandering Earth really gained the success and very positive reviews from the audiences.

Sonari Glinton:

And while traditional Hollywood blockbusters like The Avengers franchise to bring it full circle on Angela Bassett are still one of the strongest box office draws in China, people there are hungry for something homegrown. Vicky sees the Hollywood China co-pro relationship as a thing of the past.

Vicky Ding:

There was quite a plenty of co-production going on and got released, but the box office performance was really bad in The States and in China domestically. So I think people are more confident now to tell the story in the Chinese way. The foreign audiences, I think the international audiences are willing to see something authentic Chinese.

Sonari Glinton:

But also Hollywood and all the other woods, frankly, one a piece of this growing Chinese market. As a reference point, as of 2020, there were 44,000 movie screens in America, keyword now because of the pandemic. With 75,000 screenings and a population of 1.4 billion people, China is an appealing and very lucrative destination. And like everywhere else, China's film industry isn't immune to challenges from streaming services, but they're innovative. Does this sound familiar?

Vicky Ding:

In China, we do have something so-called private cinema. So it will provide a mini room for you and you can choose the film you want to watch.

Sonari Glinton:

Whether it's a private movie rental or a multiplex, there's no doubt China's gone back to the movies in a big way.

Vicky Ding:

And for the first time in my life, I couldn't buy a ticket during Chinese New Year holiday because it sold out everywhere. So I only want to see one film during the holiday and it's completely crowded, like there's no empty seat at all.

Sonari Glinton:

Imagine that.

Sonari Glinton:

I started this episode on Hollywood Boulevard and I'm ending it on another iconic movie street, Sunset Boulevard. Now I'm in front of the theater you would consider my own theater where I see most of the movies I go to, the ArcLight's Cinerama Dome. Now it's about 60-years-old and it looks like the top half of a giant golf ball that's been lit from underneath. The last movie I saw here actually was Fences with my mother at Christmas time. But this time I'm here because the Cinerama's future is uncertain. In April, ArcLight announced that after a year of struggling through the pandemic, they're closing their doors for good, with 300 other screens.

Sonari Glinton:

Now there's a chance that someone will step in and save them, maybe even another movie chain. But the idea of losing this place is a big blow to movie lovers who kind of think of it as home. Now, it was never just about the movies I saw here. It was about the people who were here to watch along with me, laughing, crying, talking back to the movie. It's the whole experience. But as I look at this theater waiting for someone to swoop in and save it, you can't help but think of the theaters in China that are busier than ever. And I think of the cross-cultural pollinating that goes on with those films.

Sonari Glinton:

I think of the cinemas that will survive, that are finding new ways to show the movies of tomorrow, movies that will tell our stories and help us better understand what we're all going through right now. I'm Sonari Glinton, and this has been Now What's Next, an original podcast from Morgan Stanley. Now, if you liked this, do us a favor. It'll help us if you leave a rating and a review at the Apple Store. Next time, I'll take you on a trip to the post pandemic shopping mall where what's in store is not exactly what you'd expect. Thank you so much for listening.

 

The past year, major Hollywood movie theatres came close to bankruptcy, while independents struggled to stay alive. Host Sonari Glinton explores how the pandemic changed how we watch movies, who gets to tell stories, and where they get made.

In this first episode of our new season, we meet Shelli Taylor, who became the CEO of Alamo Drafthouse Cinemas just weeks after the pandemic temporarily closed all their locations. Cameron Bailey, Artistic Director and Co-Head of the Toronto International Film Festival, talks about diversity in Hollywood, and how the past year is shifting the films and filmmakers we celebrate. Then we meet Vicky Ding, who runs a film sales company in Beijing, where theatres are booming as China takes the lead as the biggest box office in the world.