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Comcast CFO: Declining Disc Sales Alter Theatrical Slate

24 Sep, 2013 By: Erik Gruenwedel

Comcast CFO Michael Angelakis

Michael Angelakis says incoming Universal Studios CEO Jeff Shell will incorporate cable background guiding film studio going forward

Ongoing declines in sales of new-releases movies on disc prompted Universal Studios to revamp its 2013 theatrical slate, including delaying animation releases and upping sequels, Comcast CFO Michael Angelakis told an investor group.

Comcast owns NBC Universal, which includes Universal Studios and Universal Studios Home Entertainment.

Speaking Sept. 24 at the Goldman Sachs Communacopia confab in New York, Angelakis said the slowdown in packaged media sales has resulted in “structural challenges” at the studio, including both at the marketing and creative levels.

Specifically, the studio delayed the release of Despicable Me 2 spinoff Minions in 3D from December to next summer, forcing Illumination Entertainment animation unit to push back its release. At the same time, Angelakis said Universal focused on sequels, including upping the release of Fast & Furious 6 in May.

The CFO said the challenge at first was recognizing internally that there were issues around the deterioration of DVD sales, and then how should the studio build a theatrical slate that has modest risk and incremental upside.

“I think we’ve actually done well with that this year,” Angelakis said.

Indeed, the studio a year ago lost about $70 million cash flow through the third quarter, compared with a gain of about $100 million cash flow this year, according to Angelakis.

Earlier this month, Comcast named veteran TV executive Jeff Shell to run Universal Studios, effectively replacing longtime studio boss Ron Meyer.

Angelakis said Shell’s European experience would work well with Universal Studios since an increasing percentage of studio revenue is coming from abroad.

“International, obviously, is a much bigger component now of the business, so I think Jeff is a terrific executive,” he said.

The CFO expects Shell to implement changes at the studio in order to “take on” the aforementioned challenges. Indeed, veteran home entertainment executive Craig Kornblau last week assumed additional duties, including overseeing digital distribution.

“We really want to run a profitable film studio,” Angelakis said.

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