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Time Warner CFO: Social Media Could Dictate Warner Movies

8 Mar, 2011 By: Erik Gruenwedel

Time Warner Inc. might be bearish toward subscription-based video-on-demand, or VOD, but it’s apparently bullish about social media — to the point the medium could influence the type of movies Warner makes going forward.

Speaking March 8 at the Credit Suisse 2011 Global Media and Communications Convergence Conference in Miami, Time Warner CFO John Martin said ongoing changes in home entertainment underscore the reality that technology is going to make the user experience better.

“There are more companies today investing resources to help us monetize our content than perhaps in the history of media,” Martin said.

The CFO said the decision by Warner Bros. Digital Distribution to test renting The Dark Knight through its Facebook page highlights a strategy toward mining social media for consumer behavior and trends, in addition to incremental revenue.

“If you look at what people are doing in social media, they are talking about TV shows; they’re talking about movies; they’re talking about what they are doing and about what’s hot,” Martin said.

Time Warner is following a burgeoning trend among media companies and studios to allocate shrinking resources toward event-type movies and/or sequels that generate the most buzz online in chat rooms and fan clubs. Indeed, Warner is back loading its fiscal year (including fourth-quarter home entertainment releases) with a slew of big budget sequels, including The Hangover Part II on May 27, Green Lantern on June 17, Harry Potter and the Deathly Hallows — Part 2 in 3D on July 15, Final Destination 5 on Aug. 26, and Happy Feet 2 on Nov. 18, among others.

“It’s one of the reasons why we think in a world where there is more and more choice than ever, in terms of media consumption, there is more and more migration toward the biggest hits,” Martin said. “And social media is a big component of that because people want to talk about the biggest and best stuff. We think that will all accrue to our advantage.”

Separately, Martin took a more conciliatory approach toward Netflix and Amazon compared to CEO Jeff Bewkes’ often caustic rhetoric, by saying the services represented an opportunity to realize incremental revenue from Warner’s immense vault of movies and TV shows.

“We think there is a place for a number of these companies that have deep value catalog businesses that are providing us with a new way of monetizing deep catalog or long-tail type of content that we didn’t have only a short time ago,” Martin said. “That could be very attractive for us.”

About the Author: Erik Gruenwedel

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