Barry Diller made his name in the film industry as the chairman and CEO of two Hollywood studios, Paramount Pictures and what was then 20th Century Fox. Now, he is declaring the industry dead.
“The movie business is over,” Diller said in an exclusive interview with NPR on the sidelines of the Allen & Company Sun Valley Conference, a media and technology conference in Idaho. “The movie business as before is finished and will never come back.”
Yes, that has to do with a substantial decline in ticket sales and the closure of movie theaters during the coronavirus pandemic. But Diller, the chairman and senior executive of IAC, a company that owns Internet properties, said, “It is much more than that.”
According to Diller, who ran Paramount and Fox several decades ago, streaming has altered the film industry in substantial ways, including the quality of movies now being made.
Last year, several media conglomerates, including Disney and WarnerMedia, decided to debut new releases in movie theaters and on streaming services simultaneously. That was a radical change, and theater chains protested it.
“There used to be a whole run-up,” Diller said, remembering how much time, energy and money studios invested in distribution and publicity campaigns.
The goal, he said, was to generate sustained excitement and enthusiasm for new movies. “That’s finished,” he said.
The way companies measure success is also different, according to Diller.
“I used to be in the movie business where you made something really because you cared about it,” he said, noting that popular reception mattered more than anything else.
During Diller’s tenure at Paramount in the late 1970s and 1980s, the studio released movies like Saturday Night Fever. But since then, he has been known for his work in television. He helped create the Fox TV network, for example.
Now at IAC, he’s more closely associated with internet ventures, including the Daily Beast.
Diller on how the quality of movies has suffered
Today, streaming is a multibillion-dollar industry, and competition among companies for content and customers is fierce. Diller pointed to Prime Video, Amazon’s streaming service, as an example of how incentives in the entertainment business have changed. In May, the company announced plans to buy MGM for almost $8.5 billion.
“The system is not necessarily to please anybody,” Diller said, suggesting Prime Video’s primary purpose is to get more customers to sign up for Amazon Prime. “It is to buy more Amazon stuff. That’s not a terrible thing. It just doesn’t interest me.”
During the pandemic, there has been a massive spike in on-demand video. In the first quarter of 2020, Netflix added 15.8 million new subscribers. Since then, its growth rate has slowed, but the company says it ended the year with more than 200 million customers.
Diller acknowledged the recent success of streaming services and how indispensable they became during the pandemic, but he was less complimentary of their expensive efforts to create more original content.
“These streaming services have been making something that they call ‘movies,’ ” he said. “They ain’t movies. They are some weird algorithmic process that has created things that last 100 minutes or so.”
For Diller, this is about seismic change and nostalgia, but it is also about semantics. The definition of “movie,” he said, “is in such transition that it doesn’t mean anything right now.”
Companies are trying to figure out what viewers want and how they want it. That has led to hits and misses.
Diller dishes on the spectacular failure of Quibi
Asked about Quibi, the now-defunct streaming platform founded by Jeffrey Katzenberg, the former chairman of Walt Disney Studios, Diller was unequivocal. “Quibi was just a bad idea,” he said. “I mean, it’s that simple.”
The company raised $1.75 billion, and it spent most of that money commissioning content — short videos designed to be watched on smartphones.
In the months that followed its launch last year, Quibi failed to get any traction, and it ended its streaming service in December.
“It was a bad idea that had no testing ground other than a big-scale investment,” Diller said. “Otherwise, it would have slithered around for a while. But it was such a big-scale thing that it lived and died in a millisecond.”
In January, Quibi sold its assets — 75 shows and documentaries — to Roku, reportedly for less than $100 million.
“It has no relevance on anything,” Diller said. “The idea of professional, A-quality 10-minutes-or-less stuff just made no sense.”
Katzenberg was a Diller protégé — part of a group of people whom Diller mentored known as the Killer Dillers — and he is also in Idaho this week, participating in the Allen & Co. conference. Through a spokesperson, Katzenberg declined to comment.
Diller said he has “almost zero” interest in the movie business today. In recent months, he has turned his attention to producing plays on Broadway.
“I find that far more creative,” he said.