SUMMIT TOP 5: Ted Hope on Navigating the Future of Entertainment

Zack Arnold

Well, you and I are clearly on the same page, and I, literally, for my audience today, have brought hope into the conversation. There's gonna be a lot of hope puns throughout today's episode. I'm sure you've heard them before, but you are what one of my other summit guests, Best Selling Author, Christina Wallace. She calls herself a human Venn diagram, and I would say you two are a human Venn diagram. So let me just walk through for you and everybody else that's attending why you are here today. I have spent months ever since I thought to myself, I want to bring together multiple perspectives from multiple facets of the industry, because we are not an entertainment industry. We, right now, are entertainment industries, and I don't think we can live in our separate silos if we're going to keep moving forward. So I thought to myself, here's my unicorn. My unicorn is somebody that's both at the intersection of the business of filmmaking but also the art, somebody that also has worked at the highest level in the studio systems, but has also literally been in the indie trenches. That's not hard enough, but wait, there's more, somebody who really understands the economics of storytelling, but puts the artists and the art form first. That also just happens to be a really great writer themselves, and most importantly, can bring hope. I thought that person was a unicorn, and then literally, the next day, I said, this is what I'm looking for. You dropped into my inbox, I discovered your sub stack, and the rest is history, just like when you tell the story of you watch the Maurice perros and you said, Oh my God, to work with that director Sunday, and the next day he calls you. You make 21 grams. The rest is history. I honestly don't know what I've been what I've done, to be blessed with the fact that not only did you respond to my emails, but we're having a zoom conversation my level of gratitude. Runneth over Ted, so I'm very excited to introduce you to much of my audience today.

Ted Hope

All right, thank you. Zack.

Zack Arnold

You are more than welcome. So here's where I want to start, because we could cover just about anything, because you live within so many of these Venn diagrams. You had stated in a fairly recent post on sub stack that we need to develop the fine art of recognizing when it is appropriate to state the problem, and you and I have the same affinity for never keeping our mouths shut. In this summit, I'm going to talk about the quiet parts out loud. So where we begin is a two part question. First part of it, what are the cliffs notes, versions of what the hell has happened to the film and television industry over the last couple of decades? Which will lead us into part two. Why do movies suck. That's where I want to begin today.

Ted Hope

Well, you know, just those two pieces show how much the the art and the business are woven together, you know, and they they have positive and negative effects on both. And, you know what, like, that's okay, that's that. That's just how we find, find our way. But when you go back, you know, you know, my, my real start is the 90s. I started making movies in the 80s, but I really only came to understand, you know, producing in the in the 90s. We started good machine in nine at the end of 1989 my that was my first company. And, you know, I was thinking back to this just recently, compared to my last experience, how fortunate I was that in my early career, I wouldn't say it was a mentor, but I had a partner who handled the business, who was a good person, and that was both external to our company, good machine. We got a lot of help from a man named Scott Meek who ran a company called Zenith out of the UK, and it so happened that he both backed myself and Hal Hartley. But then Christine Vaughn and Todd Haynes, you know, and Christine and I collaborate together on other projects. And then my business partner was James Schamus, and he did also work with Christine, and they, you know, good people around you, carrying what you do make a good difference. And unfortunately, I think that's actually become a lot harder to find they're out there. But because of the other changes within the industry, the smart, good people recognize quite often, like you probably don't want to stick around, but I do hope that I can do what has been done for me, and support others. But the main difference, I think, is, back in those days, you easily had 250 doors to knock on, you know, to get your project made. And although I still have a list of quote, 250 active private equity companies soon to publish on my sub stack, they're not really in the business in the way they used to be. In the business. And it used to be that there was a, you know, people might disagree. I would claim that there was a wider variety of types of movies and business models that you could have to earn your money back. So it was a more hospitable to private equity investment in the US, and more hospitable to foreign partnership in some form or the other, because you could track like a film that didn't perform in the States, could perform internationally or in a specific territory. And sometimes that success alone, you know, could catapult you, it wouldn't necessarily be crossed. You had 190 different territories to sell to, and there were at least four or five different media buyers, you know, whether that was theatrical, Home Entertainment, broadcast, cable like that. You had, you had this whole slew of different direct sales that you could do, and so you can't, you could keep going and going. It's been consolidated significantly, not just in the individual territories and across all media within those territories, but across globally, right? And that that has been a complete transition, you know, to the dominance of global streaming. And global streaming brings with it several other challenges, and all of it creates what I would, you know, feel as a anti competitive environment, right? So the local buyers in the territories are fewer because the global streaming platforms use their competitive advantage, which was capital, you know, to end predatory pricing tools to drive the other people out of the business, and I had a front row seat to it during my time at Amazon, that their model favored initially, and not all of them, and it wasn't uniform and all of that, but eventually It moved towards this favored an all rights acquisition model, which meant that independent suppliers, you know, could would look to try to keep the world available right. And this slowly decimated the international sales model, which was what was best for the American private equity. At the same time, you know, private equity in America used to be able to put up 10% of a budget, go out and pre sell 30% of the territories, you know, get a tax credit for, you know, 20, 25% of that, that balance and gap the rest, right, or easily at that point in time, having financed 85% of the film, find the rest through a private another private equity partnership. And at that time, there was success based bonuses. In success you, you would win. And this, the global streaming platforms got rid of that. There is no upside. So really, when you start to see like you're taking a full risk, you know, trying to preserve the all rights availability, so there would be an acquisition, and that buyer only gives you the up sell of the price. You know, you're taking a huge gamble. Now, most of the private equity companies generally wouldn't want to put more than 10 million on a on a movie, right? So this stuff then leads to them starting to having a partner across so they are diminishing their own upside as they diminish their risk because of their amount of available capital, right? The days where you could put up 1 million to own a $10 million movie are gone, right? And that means they can take less bets, so even more funding is coming in, right? You know, I saw somewhere just recently, it was reported that next year's content spend for Netflix exceeds what the US theatrical box office is. And I was like, what that? You better check that fact that I heard it reported like, literally in the last 48 hours. But you know, so if you look at what was captured in that, right, you have a consolidation of buyers. You have the dominance of the global streaming platform. You have the collapse of the international sales model. You have the collapse of the private equity model. You have the collapse of the success based bonuses. And you have, ultimately, a mechanism. Some of anti competitive behavior that hasn't been enforced, right? You know, you look at alternative models, you know, people mentioned the Paramount decree, buddy and but perhaps an even better model in those days was what television the three broadcasters maintained, which was, you know, FinCEN, which forbid the three networks from owning the programming they had during prime time, which gave rise to a plethora of private companies, suppliers, and made you know entities, you know, like like Norman, Lear and so on. Obviously great towns, but also incredibly lucrative for them. You see a similar thing still happening in the UK, where they mandate a, I think it's only 25% mandate on third party supply, independent productions, on their government run, BBC, channel four services. But as a result, since independents can do things for less, at a higher quality and a much

more attuned to the changes, 78% I think the number I last saw was actually comes from independent suppliers. That's not the same here, right? It's, it's a much harder situation. And what is lost in the process is a system like when we had those 200 doors across five different media, so 1000 doors to knock on and many different ways of project. You know, many reaches for the brass ring, the golden apple, what have you along the way, people found a way to get these movies made, and they worked as cultural course correctors, right? That that corporations, by their very nature, you know, are risk adverse, right? They want to just repeat the model that works before, right? So, so we end up having a lot of movies and series that are designed based on those prior examples, and it's very hard to say current with audience taste, because despite what they teach you in econ, 101, right, the markets and the business don't move fast. It's the audiences, the artist and the art that moves fast, right? And the industry has been very slow to adapt to those cultural changes. But that's what independent film, historically, always was the cultural course corrector, you know, for for the entire industry, and we've lost that too, right? So, so now like and as a result, what do we see in the acquisition patterns, you know, of the remaining independence, right? They basically only fall into two categories, right? The proven out tours, the ones that have already achieved success on the global stage and film festival arena, and the proven audience commercial genre of horror films, right? You know which allow, because, like, the entertainment value is not based on spectacles so much, but things that can be done relatively cheaper, but you also see, thus a elevation of that execution, right? That you have films that are now also working on those global Film Festival stages coming from the horror genre, and thus you have an expansion of the audience because more people get exposed to it because of the critical acclaim. You know, fascinating thing. But then you wonder, like, Why have they ignored other audience, you know, audience forward genres like comedy, right? People always say comedy doesn't travel, but like, I don't. I've never believed that. I've laughed hysterically at films from all over the world, in different languages, you know. And I don't think it's just me, but like, I think it has to do more with the risk aversion that we just haven't developed that cadence of supply that, you know, because of the, you know, comedy, I think, can also be made very inexpensively, but it relies on comedic talents who quickly their value quickly escalates in it, all of this is, then, you know, represented in a in a kind of this, this cyclical. Nature of how it then has a downward effect on both the artists and the the the art itself in that we're now living in a time that I often refer to as the differential, where there is a big difference between perceived value and actual value, right? So, and this is also true in the early 90s, when we started selling our films, but because of both the advances in technology and the ability and know how advances in technology and the shared institutional knowledge that finally trickled down, there was an increase of supply of American Independent low budget tours, and that supply during that time of where the ecosystem was led to a increase of buyers in different territories who favored that type of authored work, and so you fixed what was once higher perceived value. The competition to get the right titles led to an increase of pre buys until like perhaps then they needed to be another correction along the way, but right now, we're at what I think is somewhere between 40 and 60% underestimation of perceived value. We're not paying anything close to the actual value. And I say that, you know, like I can't show you the science behind it. I just can show you my lifetime as a picker, right? Like, whether that was when we had a sales company and having to do thumbnail estimates of what value was in different territories, or when I was at a streamer Amazon and had to do estimates and about number of eyeballs, I'm generally, you know, in the final 10% margin of correct guessing historically. And when I look at where films are right now, you know, I would say they're willing to pay between five and 6 million for a $15 million value, you know. So that's huge, right? And, and the unfortunate result is you can't make your film. That needs to be 15. You end up having to make it at five. So it starts to become a self fulfilling prophecy, right, that people don't have the resources. And yes, it'd be nice if it was a simple fix. So why don't we just have a brave soul come and start giving the money that it's needed, because one film is not going to determine it. You actually need to actually do it, probably across like 25 to make all that work. But I can tell you that during the time I was at Amazon, those films all delivered what they needed to deliver, in terms of eyeballs, and we spent generously and appropriately at that that that time you know. So all of that you know, contributes to the downside of where we are, but unfortunately, there are other factors on top of it too, right? You know, you have, I guess the best way to call it is like the Wall Street control of our media industry, you know, to to a large degree, where everyone is looks at short term returns and you have the kind of leftover. Windfall, positive and negative of the kind of free money period that where people, where large institutions, could just borrow money, you know, at lowest cost, and it allowed companies like Netflix and Amazon, of course, to achieve their market dominance, you know, and then make everything based on their actual you know, value is much more about stock performance than it was profit and loss and You know. And similarly to that, you had the the kind of change in the business model, which some people missed

when we shifted to the dominance of global streaming. We went from away from a single title, profit, revenue based model, right, where a film was evaluated and whether it had a profit or loss, right to one that was based on audience acquisition, right? And that's a much different approach that requires a portfolio of titles targeted for a specific audience, right, and starts to measure things like like one. What their individual platform decay curve or shelf life is, right? Like titles only actually valuable for the most part, for a much shorter time. And so you don't then plan what the old system of territorial licensing cost media had built into it, which had a positive windfall, because it was a series of inciting marketing incidents, right so that titles would be reinvented with each new platform in each new territory they went to, which made certain titles have many bites at becoming an evergreen title. You look at something like a Boondock Saints, right? You know, which did not work when it came out, found new life on home video, on VHS, I think even before DVD, and eventually became like a multi part, you know, series and gave the stars a longer career as a result of it. Like there were titles that were rescued by other territories or other media, and we no longer have that right. You see the difference even in the nomenclature, right, the vernacular, like we used to launch titles, and now we drop titles, right? You know, like and it speaks the world. You used to feel that that you needed six months prep to establish a film's place in the marketplace. Right? Now they think you need six weeks, right? They use to try to measure the number of impressions that each audience, potential audience member, would have to be able to convert them, you know, into action to get them off the couch and into the theater, right and and now, instead, we practice saturation marketing right, so you start to see what all where our original hopes was, Oh, my God, the internet will deliver us the long tail, you know, and this can truly, truly work. And instead, it became a tidal wave of quote content that crushed everything and limit its life. But some of that comes because the teams no longer plan for what will be a long release and a number of impressions. They just like, block out everything else, and you see like, again, like the challenge of not having the correct incentives, perhaps what the net resulted, like, we used to say, like, the whole problem is that you know, whether you make a $1 million movie or $250 million movie, you still have to reach out and tell the world, right, that you made this movie, to get them in order to come and See it, which meant, like, basically, you want to put anything in America into a typical release pattern, you needed to have $10 million or so in marketing to release your film. So if you have to have $10 million in marketing, you generally aren't going to be making million dollar movies, right? You know? So how do they, they they justify that? Well, the solution, you know, was ultimately, eventually found in global streaming, and it's added its dominance was their number one driver of engagement, became that the merchandising on their interface, on the user interface, and that really led us to what we watch. But it's not informed in, you know, engagement. It's not properly contextualized as what it is. It's clickbait. Everything gets reduced to the same level and like, why do you want to watch this one or that one? And so instead of actually taking control of our choices, we sit back and we look at the top 10 and we click the one we haven't seen. Because when your goal is audience acquisition, right, your goal is actually to have everybody watch the same thing, right? You know, it's best contained for them. You know they want it to be as predictable. Give predictable isn't trying to match your taste and my taste and her taste and their taste. It's like get us all to just be willing to acquiesce to the same thing, you know, and that, and then I'll take a breath, you know, chose another key thing that we forget in like that transition, like if you say, Okay, what did you learn over these last 40 years? 35 years? Whatever you want it to be, you know, like this is now the age of distraction, right? You could call it the age of abundance, because that did come first. And you could call it the age of global streaming platform dominance and anti competitive behavior. But it is really the challenge of distraction, because in the 90s, we weren't competing with with gaming for one, we weren't competing with social media for two, but we also weren't competing into this huge boom in, you know, sports broadcasting across like every, you know, game and through every country, like all of that is also all there. And you know, the nature of social media also then gave us a net, further splintering, you know, across the board, you know, in terms of what, what, you know, the creative community starts to generate, and we find other new likes which may not have been on the map before. So unfortunately, what we're still lingering in is this period of, I would say, passive engagement, where, you know, contributed by the endless scroll. You know, whether it's vertical or horizontal, you know, we don't actually work to make choices. You know, you go back to a prior period. You picked up the alternative weekly in your hometown that came for free because it was selling you ads, but it had the movies listings. And you surveyed those movies, and you made a choice, and it better be worth it. You were serious about it, because it meant you're getting out of your cat, off your couch. And whether you drove there, took public transportation, you were spending money and time and inconvenience, and so you wanted to be an informed viewer. There's a lot of this, you know, like, I think is only transitionary, right? You know, adjusting to a world of abundance and distraction requires a cons, a conscious choice for you to start to select right what you want. And since we do have access, or presumed access, to the history of media and entertainment, we can actually make pretty good choices about what we want, and since anyone I believe now is capable pretty quickly at putting together a list that should keep them entertained beyond A reasonable doubt at the maximum rates of consumption, you know, for the rest of their likelihood of living. You know, you know, whatever that is, right. You know, like I am now, I once got as high as 350 films in a year. I think that was my peak. And now I run around 200

a year, but I'm not going to run out of good movies. I don't. The only reason I need new movies is because of their cultural context, because of they're made by people who live in this world with me, right here, right now, and what I can learn from that, but the history of cinema has supplied way too many movies for me to ever get through my desired list, you know? And I think that there's a transition where, like when we recognize that, when I choose, and I no longer do to watch his show, because everybody else is watching it, right? I'm choosing to not watch something that I know I will respond to positively because I understand what my own tastes are now, right, you know, and I've seen everything I possibly can, except for all the titles that are there. But that nature of abundance and distraction affects the art too, right? Whether we choose to make stuff that is designed to keep you hooked in a click through environment, or we choose to make a different type of work that might require a deeper commitment and deeper submersive experience, along with a deeper reward for for that sort of engagement, right? But all of this in both our selection and discovery, our prioritization, our compensation for our engagement, our mindfulness. In our concentration on prioritization and choice, none of this has yet to really been built in a structure, so we're kind of either on our own or in our community to help with that. I think I hit most

Zack Arnold

Oh, my goodness. I don't know about you, but I'm exhausted. For anybody that was wondering why Ted, hope they're my friends. Is your answer? You just got a free 30 minute masterclass on understanding acquisition, distribution, domestic markets, foreign markets, attention spans, aggregate content, vertical integration. Frag, like, I don't even know where to start. There's so much amazing stuff in there. This is like a drop in the hat of the kind of stuff that you share on sub stack. I have never learned more throughout my 25 plus year journey in this industry to better understanding not just how do you tell good stories. I've always been very much a crass person, learning about editing storytelling like, you know, on the story level, the narrative level, but I've never had such a great over kind of arching understanding of how the business actually works, why we make the things that we do, since I discovered your work. So this right here, that's why I wanted to invite you. And now I want to do what I think many, or at least some might be thinking, which is addressing the elephant in the room. The elephant in the room is the vast majority of the people that I hope are attending the summit, I would presume, because they're my audience and they found me. They're the creatives, they're the artists, they're the storytellers, they're the boots on the ground that are doing the work. And I would presumably some of them are like, ooh, producer, studio, executive, like, why are we having him being a part of this conversation? And I want to share something that you wrote which is going to transition us talking so much about the business side of things to a little bit more of the art form. So we can figure out, how does this become merit based again, and it is about the greatest stories rise to the top, rather than we just need people to click through this right here, I think, is the sentence, or sentences that maybe say whatever it takes Ted hope is going to be on the summit. So these are your words. You said that movies should be creatively ambitious. They should say something substantial, and that those who made them, this is the important part to me, that those who made them were special people who deserved our support and honesty. Because in the creation of both art and business, never forget the human side of the equation. First of all, so many more on the studio executive side, the producer side. I only wish that they could see the value that all of our creative contributions bring versus the spreadsheets we need to acquire users, we need to please the shareholders. This, to me, is the reason that I don't think there's anybody else on the planet that lives at the intersection of these two things better than you do. I want to do a little bit of insider baseball to help people understand it a little bit deeper level, why things suck. And you can tell me if I'm wrong, but this, this point, really hit home for me. It's that in 2015 when, uh, Jeff Bezos, former CEO and clearly chairman, founder of Amazon, he said, we make movies to sell shoes, and you enter this world where you're told that, as you said, I never thought I was gonna make films peddling power drills. You were told the customer is worth more than the content, and it's all about things like first user streams. So I don't wanna go too deep into it, but I wanna get some insider baseball to help people understand, why don't we just make good movies anymore. There's a reason behind this. There's a machine that's creating the quote, unquote, content that we no longer want to watch. So let's talk a little bit of this insider baseball from your years at Amazon.

Ted Hope

Sure, and you know that people forget, and I have to remind myself, so I'm not surprised they forget. You know how some of that Amazonian thinking was such a gift on a creative level too, right? Because, you know, all systems get rigid, and then they start predict living to essentially, to preserve their their status and position, right? And you see this in film, particularly because it was such a capital intensive art form, right? So they, they go for the established audiences, right, which, for the longest period of time in America, was about 1616, year old straight boys white, right, you know, and you know, you had, yet it was such a great art form that communities, families, you know, and everybody wanted in on it. But yet, the dominant system was supplying for a very specific, targeted audience. The audience. The rise of independent film, you know, started to recognize that there were many underserved audiences. My friend and frequent collaborator, Christine Bucha on, you know, once when she was asked like, how do you. Determine, you know, who you're making a movie for. She said something to the effect of, we look to see if they ever parade. If they ever parade, they're organized, you know, get them out, right? And Amazon's thinking was a bit of on that same level, what the beauty of being in everything store was entering the film business was what, where they saw pockets of behavior that could be addressed to different audience segments, right or consumer groups, and you could start to see when, by the design of their program, you know, which was essentially free shift, free to get free shipping. You paid a premium and you got all these other things, one of which was the subscription service. Initially, you could see that there were customers who were identifiable, that were not using the video product, right? 20 to 30 year old Latinos and that yet they were a huge movie going audience who over indexed, right, and yet they weren't using it. And lo and behold, there wasn't enough content that that was either made by them or starred in them. So for a lot of people who think things like die di was designed, you know, from a political social it was a great business practice because it produced, in general, and still will produce a general supply for underserved audiences, right? And what that meant for somebody who was essentially a commissioning editor or publisher, as it were, as my role was, while I was at Amazon, you could now start to look at a wider variety of creators and a wider variety of narratives. You know, in terms of what you thought excellence might be. I had a real benefit, which doesn't sound like a benefit to much of coming in when the audience was small, right? The audience. What that meant, though, was like when we had 30 million users, 50 million use, 70 million years, 120 million you like, through that growth, that's who you were targeting, right? So as somebody who, through his career, has always made authored work. Our authored work is a large part it may not even escape the part of the Venn diagram that that has prestige cinema in it, right? It should, but it may not yet, you know, and it usually got categorized as art house. I would say that it it also had historic grind house and other, quote, exploitation, flair, fair and flair within it. But it was that wasn't fully utilized by the industry. And you. And the early benefits of algorithmic program and direction was that it could help those audience segments find more like it, provided you had it. It took the studios, all of them a while to recognize it wasn't enough to provide a title that appealed to a specific audience segment, you might get a lot of first stream users who would join just to see that movie, but if you didn't have the quote shoulder content To keep them engaged on an ongoing basis, right for me, what it really did, I think, is my the biggest kind of aha moment came before I joined Amazon, when I was running a startup boutique stream at fandore. And you know, the 25% of the employees had already been involved with successful startups and thus became millionaires. And they were really lot of their own. You know, career choices was trying to pick the next successful startup, and since they they already were, you know, economically secure. They had no hesitation confronting the CEO, which was me with, did it? I know what the hell I was doing. And you know what? I think a group of them decided was, quote, funny, was like Ted. You think this film streaming service? Service is a film business related enterprise. It's not it's about audience acquisition. And do you know how to acquire audiences? And they had a kind of go to phrase got honed further over the time, but it was like, this applies whether you're an artist or a CEO, you have to understand that that audiences are built by a regular cadence at a consistent quality of supply in an environment that people trust and want to participate in, right like thinking that through the regular cadence at a consistent quality now when, when there are challenges in execution of that right. That was initially in that peak content era, what was often thought to be, you needed to, quote, supply a film a week. Disney, Paramount, Netflix, all announced they were giving you a new film a week. You know that, you know, when you look at like most studios were putting out 15 they were all sudden, claiming they were going to, do, you know, um, you know, close, closer to four times that amount Crazy, right? But they meant even something more than that, because, you know, each of them had their own definition of how many audience segments there were and how many audience segments each title might apply to. But let's just assume, at a minimum, it was 15 different audience segments and four or three to four groups at any interview. Film might have appealed to, you know, all of a sudden, you know, you needed to do a film a day. That's five films, three segments, 15, you know, data, you're basically having to do it constantly, and there's no way that they could staff appropriately to fulfill that business goal or that business tactic, right? You know that you might be able to generate that number of movies, but you're not going to set them up. So the need to start to drop titles, as opposed to launch titles, also becomes, you know, part of the equation along the way. And then you start to see that actually managing towards excellence, which is what the producer's job is, right? Trying to make lift the good into the great. Really doesn't matter for most of the audience like them, they want to be comforted. They don't want to be challenged, right? You know that that, that feeling of seeing what a remarkable human,

everyday person is capable of, which, to me, is just like, it's a religious experience. It's like, you're you're feeling the presence of something greater in all of us, right? It's just like, makes my eyes watered right now just thinking about it, right? And yet, we've seen that in cinema, we've seen that in sports, we've seen that in music and literature and art, we see that in our families, we see that and all of these things, we know it's an everyday occurrence. It's not a miracle, right? We can have a system that can lift that, but you know what? It's time consuming, it's costly, it's risky, and the system that has now been built no longer wants it, right? You hear from, I hear from other producers in meetings, and they explain, you know, if we have one more day of shooting, we can do this and catch this, and we all agree, much, much better, much better. Not worth it. Not worth it. Like, my favorite part of the process is, I think the final 10% and it's one of the reasons this is so it's my favorite is so aggravating, because you are truly in the realm of the unknown. You are fidgeting right? You're trying to fix this thing to a level of perfection that the nuance level that I know that virtually every filmmaker I've worked with, every editor I've worked with, every screenwriter I've worked with, cares so deeply about but I can tell you, even the film critics and film executives miss it. Right? You know, when you when you like the like, why bother on that last 10% right? The reason you bother is because, actually, those that final 10% makes the film timeless. I think it is that piece that becomes what we're seeing. Is that representation of, Oh, my God, they they reached beyond their. Capacity. And somehow they got hold of it, they, you know, it lifted them up, right? You know, like that. That is such a like when you see an athlete or a performer in the zone, right, like it, like, how can you not have that warm wave go through your body? And I think you see that in narrative execution, in gorgeous cinematography, in that type of thing, when you're looking at it and it just feels true when we feel seen and heard verified. All of this comes together. It's transcendent, right? But execution for excellence is costly and unfortunately, not a good business model. Now it could be and it will be like I'm I'm not sure I'll see it in my lifetime, but because I firmly believe that there are processes that we can use to elevate the good into the Great. And it's not about individual genius, right? It's about process and faith in the process, devotion to the process that allows you to get to that level. They will become a time when in all cultural industries, there will be, I don't think it's a unicorn. I think it's a workhorse, right? It's a it's a Clydesdale it's like Clydesdale horse that, those are the horses that pulled the Budweiser brewery truck back in the day with a huge hooves. You know, that is willing to do that, that labor of that 10% that's hard to justify, justify for $1 and cents sort of thing, but it is a reason that cathedrals get built. It got built. Pyramids got built, that that museums got built, that libraries got filled, and we will, you know, we will obtain that commitment and devotion again, but it's going to take a while and as and it takes the individual and the community support to say this matters, and I'm going to do it, but it's a resistance. It's not a settling for this is what it is. I can get my movies made. You can get your movies made. And basically, you know, get by on a c plus and keep working forever, as long as you don't rock the boat. You know, if you actually think that art is a transformative technology, a transformative experience, a transformative joy. You know, you can say like, oh, I'm willing to put my life into that and maybe make a few fewer things in exchange, you know, to try to deliver that mark,

Zack Arnold

right? Well, here's a term that I never would have ever conceived to have brought together until you just said it. But I would argue that I don't know every single person that is logged in that's viewing this right now, but I would argue we're probably the creative Clydesdales. Anybody that's still here listening to this conversation, we are the ones that are not giving up. It's not just a matter of, well, I guess I still need to find a gig in the film industry. It's like we actually care. We are the perfectionist. We are the storytellers that want the whole that 10% is what we want our lives to be, and we get lost in the timeline, lost in the page, lost in the session, whatever it is, it's that 10% where we're going from good to great. That's why we get out of bed in the morning. I know that's why I get out of bed in the morning. The amount of nos that I've had in my career from really great opportunities because I said I don't want to spend my days telling these stories or working with these people, or these being the values of the team that I'm working with. I've said No, way more than I've said yes, and I should put together a resume of here are all the shows that I didn't work on that I could have because I don't want to be a part of that. We are the 10% that wanna do good to great. And this is something I talked about in my conversation with the author of the book Blood in the machine, Brian merchant. It used to be fast, cheap, good pick two. Now the problem is fast, cheap, good enough. We get all three. And that's why those that actually still care like, why is this dribble number one or two on Netflix or Amazon or max or whatever the hell they're calling it now, right? That to me, once we have an understanding of how the machine is built, and I think the biggest takeaway for me is that bad movies or bad TV shows or bad content, that's not a bug in the system, it's now a feature of the system. Once you understand that, then you can make decisions about where to go next. So where I do want to go next in this conversation is again, oh, did you have something you wanted

Ted Hope

to add? Yeah, yeah, you know, because, you know, there's a tie back to this, you know, in the, you know, Bezos his poetry of we make movies to sell shoes. You. You know that we found, studies found previously that that the more frustrated and irritated, unhappy, unsatisfied we are, we have a common response, and that is to shop, right? So the American way, yeah, so, so when we're unhappy, you know, we look for material or experiential, you know, it's perhaps, as try to say, fulfillment, but that's what we you know, plug that hole with that. And it's interesting, you know, like the let that the nature of an irritant, you know, and what it prompts for us, you know, I don't think I would have become a filmmaker as much as I loved movies if I wasn't irritated by The movies of my time of when I was 18 and coming of age, I really wasn't happy with what was coming out of America. And it's such a small period, right? Because by the time I was like 22 I was happy, right? The American Independent thing of Spike Lee, Jim jar, Susan, seidelmen, Cohen brothers, all had blossomed by by by then, and or if not blossomed, had emerged. And I was like, that's what I want to do. I saw what I wanted to do. And perhaps four years earlier, I might have been acquiescent, like, Oh, I'm getting enough supply, you know, I don't, I don't need to make it myself. But you know, the the benefit of the failed reasoning of the test kitchen of one myself, you know, I if I wasn't happy, I figured there must be a lot more like me who weren't happy, but the I would argue that you can see within a system as a tool of evolution, even you know that that our frustration is often the source of helping us accelerate a path. So when I look at era of abundance, slash peak content and the rise of meh, you know, just mediocre ambient viewing sort of thing I see also the the the equal and opposite reaction of people who start to say, You know what I'm going to do something different, you know. And I think there's a whole challenge as we set out on our creative life, you know, to manage, you know, sustainability, you know. And I certainly know that the period I came of age didn't prioritize that any in any meaning of the word as it should have. And luckily, I was had got a lot of good breaks, and good fortune went my way, so I could, you know, pursue it, right? But I think you can look at it now and take stronger measures to make sure you have a sustainable, manageable, creative life that you can maintain and do it on your own terms and embrace that things won't always go your way, that you know. You know they will, you know, I do believe that good work always gets seen, but it may take a while for it to be appreciated. Yeah, along the way,

Zack Arnold

exactly. So what another area where you and I definitely share an affinity is we spent a lot of time talking about the problems. Well, here's what's been happening, here's why it happened. But I'm also a big fan of solutions, and you are too, and you write all about them. For example, you recently wrote about cinemas secret formula, which is not just stating the problem, but offering solutions. And you also love frameworks, like I do, and acronyms or RCA recommended courses of action. So I'm going to state what I believe is kind of my thesis about where I think we're going next, having no idea where we're actually going. I'd love to get your take on it, and then I want to dig into what you believe are some of the solutions and the practical steps we can take so we just don't keep staring at the news in social media and saying it's all going to shit, and there's nothing that I can do about it. To say what you said about agitation. We've seen cycles throughout history, even throughout the cycle of filmmaking. Over the last 100 plus years, we have these cycles of regurgitate regurgitated content. It's all kind of the same thing. And then there's this generation that says enough is enough, and that's what brings us the easy riders and the raging bulls. And you know, the lot of the films that you made came from. That period of agitation. And I would argue, a really interesting intersection is going to be, number one, an agitation with the lack of content that's being made now, despite the fact that we have enough movies to watch until the end of time. The other thing is that great art comes from making sense of reality, and right now, reality makes no fucking sense at all. And if we ever needed a time for great storytellers that are really angry and agitated to take an opportunity amidst the chaos, it's this right now. It's help us understand what is happening to our lives, what is happening to politics, what is happening to our relationships, what is happening to society. If people take that reign, I believe it comes from all this agitation and chaos. But then the question becomes, well, where is it going to go? And this is the other kind of core thesis of this entire summit, is, I think that the future of entertainment, and I want to use the word content creation loosely, but the future of really great storytelling is the intersection of what I'm now calling legacy Hollywood, because that's what I was called by a content creator, but legacy Hollywood and the creator economy, I think there's an intersection of these two, because right now, the content that's out there, especially user generated, they know how to build audiences. They know how to game algorithms, but holy hell do they not know how to tell good stories? We know how to tell stories. We're the best storytellers in the world, but we don't know how to grow audiences. We don't know how to acquire users. We don't know how to get people to smash that subscribe button. I think the intersection is of these two, plus that third intersection of people that are really angry about where we are now and telling stories to help us make sense of it. So what are your thoughts about that? And how do we integrate building a community or communities around this concept?

Ted Hope

Yeah, I completely agree with your analysis. And I would add a few other levels of spice, you know, to it. And one of them you mentioned before, in that, you know, the the movement returned to a generalist mindset, you know, from a specialist, or, I would even say, a holistic way of thinking, or perhaps in, you know, the Silicon Valley speak, you know, a systems based, you know, approach and, and that is, you know, working from well, for First, we've always relied on the dominant corporate marketing and sales structure To support our art and what we've been experiencing over, really, the last, you know, 15 years. But cinema has been pretty immune to it, until very recently. It is across all of the cultural industries, and that is the disintermediation, you know, of the industry, which is a mouthful of a word for just me, meaning, you know, the all in one supplier, you know, the a business made up of middle people you know along the way, versus direct service suppliers. And I think you can balance that with, along with the kind of concept of core incentives or the wrong incentives, and a lack of principles and values from the creators on, it just wasn't needed. I think all you have to look at all those simultaneously, which is a long way of saying we will start to see a new era of distribute distribution and marketing services arrive so that the the owner, operator, the artist, entrepreneur, the creator class can can actually maintain the value or the ownership of their work, you know, and what that means for the typical filmmaker, the person still embedded in legacy, I'd extend it beyond Hollywood, but like the legacy model of filmmaking, is that, just like you cast your actors, just like you cast your crew, you're going to have to cast your distribution and marketing people, right, you know, and those services will rise up. Now, previously, I thought that. I thought this was going to happen quicker, right around like 2012 or so, 2010 to 2012 I got very excited by the growing DIY movement in film, and that that first era of streaming, and what it kind. Could bring, even if it was still generally driven by dial up still at the time, and the expansion of storytelling platforms, cross platform, world building and storytelling that there were some excellent, successful examples in all aspects of that. But it didn't come together in the way that I thought it would. And I think a lot of it, you know, came because first we had world financial collapse, you know, due to the mismanagement of our banking system. And then you you had the era of cheap money, which really just made the powerful more powerful and increase the disparity of wealth in this country and the world, which allowed the dominant players in any business industry to enter new industries and follow a the most predictable model, right? Yet it kept going, right? So I bet on it, it didn't happen. I changed. I found a new model. I found new opportunity. I learned some things, but meanwhile, the reasons it first all took hold remain and progress has been made so and you see this really across the other cultural industries that are much more efficient in their cost of production and ability to reach and engage with audiences, because they're not long form, and they're not requiring so many teams of people, but as new technologies, AI and others come along and allow us to get more self sufficient and the services you see The restriction in the distribution we talked about the consolidation, but also the limiting of titles like in America. One of the things I had left out in the current state was you can call it runaway production, but that's not what it is. It's pushed away production. It comes from a lack of leadership in both the state and federal level, and I would argue, a misguided thought process in our union leaders, as much as I support the protection of all the labor classes like I think we've been short sighted in how we see How to build a strong industry here in the States, but it's all been been pushed out. So in America right now, all you have the only like homegrown production that financially makes sense is the low budget movies. You know, really, you know, I would say really, under three, maybe under two. Others might say under five, right? But I'm going to say that that lower number and the conceptualization creative of the blockbusters, everything you know, they make those movies outside of the country, mostly now, some get to land in Atlanta, but most of them go elsewhere now and then the in the the only thing we market beyond that is the award worthy, recognized tour master brand work, right? So unless you can break into that, there's no place else. But I know by my own test kitchen of one and those of my family and friends that we actually all desire a much varied menu of it, right? And yet they're not going to serve up the film that isn't trying to, you know, win the popularity contest of the awards. And mind you, I love what has happened in our awards industry. You know, which is a validation of authored, ambitiously authored, work of an independent level, whether it's Sean baker or nomadland or, you know, you know, we can get moonlight parasite, yeah, like, those are all exactly. Those are all films that are highly authored work, all of an independent nature, yes, of, you know, international status and top level festivals, but like that gets distributed. But there's a lot of super interesting, intriguing work that is not in that vein, that that no longer has the easily embraced business proposition of it, and as a result, since, I think. You have this thing where you have many more folks of the artist level who want to work in that vein, and very few less people in the business level who can take it on. There becomes a greater need. And since it corresponds with the anti competitive practices of the global streaming platforms, the lack of success based bonuses for both the investor class and the creative class, and the proof of concept that you know the Creator economy has demonstrated, people say, Wait a second, I need to do something different along with this, the need for a holistic embrace of both the business practice and the creative practice and the exploration of oneself As an artist or an entrepreneur

with improved tools, so and with that formula of how audiences are built through that regular cadence at a consistent quality in an environment people trust and want to engage with, and all of those contributing factors, to me, looks like a perfect storm for a kind of a new model, where, on one level, you have the long term, but projects that you're working on, and that's where you have to be able to push for that final 10% that is the excellence of execution sort of thing. But you also have, let's almost call it, a programming layer, right? That that is the kind of thing keeps you coming back like you say, I'm here, which I think often will become a shared community, right? We are gathered here today because we care about these things. We have an affinity. We have an alliance. We are bonded in this. And then there's the short term, or more personal, which I think has one of the things social media helped expose, is that kind of need to be seen and heard on an individual level, so the individual, the community and the art, right? Art is an exception. It really is, like, it's remarkable, right? But, but it takes more time. Generally speaking, it can be, you know, sudden, and there's things to learn in that too, but, how do we now as artists and entrepreneurs service those three fields, right? And you the platforms. And one of the things I get very excited, although I think the naming of it is really wrong. But newsletter platforms, the rise of individual publishing. And the reason I don't like newsletter so much as the definition or the label is because, if it makes it seem like it's all text based. But when you start to take like the remarkable volume of creators that have did this kind of first era of the Creator economy. And you see that there, you know, proficiency with video and audio and interview and and, you know, image capture and all of that. You know, you say, I want to put it on a newsletter platform, you have a stop, huh? Wait, I want to take that and make that a newsletter, but yes, exactly. It's not a newsletter. It is a all content, all forms of expression, community, right, you know, and that's what you know, like, you know, friends who use the other newsletter platforms, I think, miss out on in terms of, say, sub stack. You know, to me, you know sub stack is, you take medium and you merge it with your mailing list, right, your Mail Chimp, right, and then you add on notes, which is essentially Twitter back when it when it worked, and it's old Twitter before it burned down into that or toxic hell it is now. And then you have WhatsApp in the chat, right? You know? So, so you have all of these things, and that's what we actually have to get good at, along with recognizing how to do video and image and text and audio and how to do all those things in a world that not just comforts but also provokes that gives us the joy of what feels. Like discovery of saying like, wow, like when I think of music, books, art, film, and like when I saw something outside the realm of my imagination, but yet somehow it spoke to me, like, like, I couldn't have conceived of this, but I know this is me, like I remember those moments, you know, they're seared into my genetic structure now, like never to be let go of, and I want to have that increased experience through this New Medium and new new platform, or, you know, collection of mediums as it were, and yet, in that becomes a business model, right? Be because all of us in an era of distraction and precarity, and frankly, planned obsolescence of the owner, operator, artist, entrepreneur. We have to establish our beach hold with which is essentially a ownership of our audience, a deep participation in our community where we take responsibility for it, right? Like I've become fond of saying independent film has failed, right, that 40 years of doing the wrong thing, but I want to take responsibility for it, right? Like, I'm not saying they failed. I failed. We all failed because we didn't shift it into what it could be. Come when I saw what Spike Lee, Jim jarmus Khan, brothers, Susan Seidman and folks, I helped Ang Lee and others, all kind of created. I wanted a artist. First, cultural industry. You know that that worked and I got corrupted. I liked getting a good paycheck from Amazon, you know, like I liked helping other movies get made with, you know, under that structure. But what I never tried to really do is, how do you build a ecosystem that allows a multitude of artists and entrepreneurs for a multitude of audiences, have a sustainable practice, right? And with I believe we can enter that realm, and we will enter that realm. But in the meantime, we have to know how we're going to remain financially secure, doing what we do best and what we love, right, which means, like a handful of different side hustles, a willingness to be able to say, this is going to be a dream deferred for a little while, while I do this, or I can contribute to this and contribute to that. And, you know, build the structures, the operational improvements that are necessary to reactivate revenue streams that we've neglected for too long? Yeah,

Zack Arnold

and you're speaking right directly. What I have been writing about, speaking about, podcasting about for the last three years, which is, as everybody's focused on the Rise of the Machines, what we should be focused on is the rise of the generalists, because this is now the transition, not towards something, but back to our default state, which is, as human beings, we are generalized. We have a multitude of different skills, abilities, passion, knowledge, and to have been fed this false idea that we are going to become complacent widgets on the assembly line of somebody else's dreams in the industrial revolution, this is the way towards productivity. Like that never worked. But now at least we realize the curtain has been pulled back. This was all bullshit. And like you said, it's not about asking or answering the question, how do we build a sustainable career? It's how do we have a fulfilling, sustainable creative practice, and dabbling with sub stack video versus newsletters, versus Content Creation versus working at Trader Joe's to pay the bills. I had a very deep conversation with a five time Emmy winner that just said, I need to support my family. I'm going to work at Trader Joe's. Like, there is absolutely no shame in that whatsoever. And he actually, he found a lot of value in doing it. So having said all that, the short version is, you and I are very much on the same page on so many things. But where I want to leave us? Because there are we've covered about 5% of what I wanted to cover today, which I assumed would be the case, but I also I want to be very, very respectful of your time. So where I want to end is a statement that you made at the very end of your book, which shameless self promotion is hope for film. And you said, as long as we are willing to fight for the culture that we want, as long as we embrace movies that get under our. In the cinema will prosper, regardless of the company that underwrites it or the screen that it shines on. There is hope for film. You wrote that in the before times. Do you still agree that there is hope for film?

Ted Hope

Absolutely, absolutely. And I feel, you know, very fortunate that that was the last name I was given and granted, but I keep using it to kind of do I use it on my newsletter, my sub stack newsletter, but I use it to kind of keep my devotion and practice energized, right? And I find new ways to look at it. My wife, you know, shared with me, Vanessa, shared with me recently a quote she had found about, you know, how hope is precisely why we are willing to walk into the unknown and deal with uncertain outcomes along the way. And you know that feeling the drive like, why are we climbing this mountain today? How come nobody's forged this path yet I feel we should walk here, but the path goes there. How do I get off this train and jump the tracks? You know, that's hope, right? And I think in times of chaos, art, in all its forms, really resonate. And it resonates because it's human, because, you know, that is a core quality of what art is, right? Even when we've embraced different forms of minimalist, industrialized, you know, production. We love the fact that it comes from, you know, who we are, as as individuals and as communities and shared experiences. And I think that we become sharper in our ability to recognize where it is and hear the different tones, right? You know, the number of words we have to express something is often based around the amount of exposure we have to that thing, right? So, you know, they would say that Inuits have 32 ways to describe snow, and we call it snow, right? We basically still use one word to describe love, right, or to describe cinema, okay? So we have movies and film too, but and content. So we have four words to describe what we do and one word to describe our reaction to it. And, you know, once we get to 3035, words to describe that, I think that we will say we're at a good point, but until then, we're going to have to keep entering those realms of a unknown and pull out and try to, you know, point out what there is I find, you know, like I like the phrase, and this was very Amazonian, but, you know, also tech based thinking to describe pattern recognition, you know. How do we come more adept at spotting what we like or don't like at earlier in earlier stages? You could call that conditioning too, right? You know, but the one of as I've embraced that and tried to refine my own pattern recognition for the things that I like and don't like, which is a series of kind of deep discussion and evaluation and probing and consideration pondering, I start to see different ways it's expressed, whether that's themes, you know, quiet nuances, and the only way I found to describe those things is secret languages, right? Like, we don't quite know how to express it, right, but we still know we are being, you know, seen and heard and recognized. And I see it in cinema. When I work to develop movies with different, you know, individuals, I try to lean towards the expression of a multitude of themes, not just an a theme and a B theme, a dominant and submissive theme, but but a subordinate theme. I tried to name and define 25 different things at work in this movie, and they're not all going to be engineered for payoff or escalate. Ation, you know, and de acceleration or conflict, or any of that. They are the secret languages that that show us that we've been seen and heard, and it's why a movie might speak to us. I just recently, you know, I've spent my life, you know, mostly listening to to a handful of different musicians, Bob Dylan, Neil, young Lou Reed, Leonard, Cohen being at the Nick Cave, being at the top. But there's, you know, I can name another 15, but coming, you know, living in this age where eventually everything ever recorded, whether in a final form or in a demo or alt version, becomes released. I get a lot of joy at hearing the alternate versions of what could be, and I'm currently going through the six discs of the velvet undergrounds The Velvet Underground. And there's a mix in there called the closet mix. And Lou Reed wanted the sound is mono and compressed. And so it really feels like you are in the box with Lou singing directly to you, and his vocal experimentation is a little bigger than he does. And you know, and then he did, and there is a boldness, like when he lets his, what we assume is his personality fly. You know that that is so unique and distinct, and it's not perfection, it's rawness, right? And idiosyncratic aspects, and somehow, like in that,

that's my secret language, that that Yelp, that weird little Yelp, that vocal cracking, that thing that makes it feel real and authentic in a distinct individual way, and it just sets off bells inside of me, like, like, wow. And and I, and it leads me on a big memory trip, you know, when I'm 15 years old and hearing, you know, rock, his song, rock and roll, and sweet Jane for the first time. And what, how it affects me deeply along the way, and my path to this over 40 years, to get to this song and the you know, which will only be like so important to me for this week, right? But like, man, I've already had, like, four great experiences listening to the the songs over and over again. And so the hope for film. Part of that is, I really do believe we will come up for 35 with 35 words for the expression of every aspect of what we do, and people like me are going to be moved to tears by each expression that we find along the way, and right now, the fact that we haven't brought the mechanisms, the processes to help elevate that search and that definition by those more qualified than I to deliver that is super exciting to me. Like I look at it and I'm like, you know, one of my favorite collections of anything is what Lenny Kaye put together back in the 60s. Lenny Kaye Patti Smith's guitarist, but he curated nuggets, which is this fantastic collection of early 60s, proto punk garage bands, right? And that moment where everyone started to realize you got yourself a guitar and a drum and practiced in your garage, and there was some place you could go down and lay down a track, and you know, if you sounded a little odd and fun like that was good. And I love that period of vocals where there's a bratty sound, you know. And I think they caught something that didn't catch out right? He collected it. It helped. They wouldn't be punk rock. Sex, sex, pistols, clash, Ramones without that album collection driving it the same way that the Anthology of American folk music that Harry Smith put together is directly responsible for Bob Dylan. And you know, everything that comes out of out of that we are at the garage band. We. Here at the moment in cinema, where the 15 year olds have picked up the guitars and the drum kits and they play that one lick that they really love over and over until they found words that that that fit over it, and they go off into the recording studio. We haven't done our Sergeant Pepper yet. You know, we we haven't done Blonde on Blonde. We are getting to that level, right? But it's a slow process, and we need better technology, better systems and better practices and processes to get us there. So like to me, it's uphill. Yes, the system is against us, right? It really is against artists and entrepreneurs right now. But we can change lanes. We can shift the tracks. We can say, I'm mad as hell, and I'm not going to take it anymore. You know, Peter Finch network. We can go that, that, that, that route and and we will, and we will. We will solve this together. We'll make it better working together.

Zack Arnold

Wow. Well, I'm sure I can speak for everybody that's here. My brain hurts right now, but in all of the best ways possible, all the best ways possible. And I say this horrible pun intended honestly, truly, before this conversation versus after. I'm more hopeful for where we're going in the future than I have been. And I've always been the pragmatic optimist. I've been against the doomsayers and the naysayers, and I've been doing my best to stay in the fray find solutions for all of us. I genuinely feel more hopeful and this vision of we are now in the garage band era and the kids that are on YouTube getting millions of views, selling their candy bars. This is going to be the intersection that I keep talking about, which just makes me so excited to be a part of it, even though it's scary as hell and it's very uncertain. But having said that again, we could go on forever, but I want to be respectful of your time. I want to thank you so much for sharing all of your expertise. I'm going to make sure everybody has a link to find you on sub stacks so they too have hope for film, but Ted, dear Lord, I'm so glad I had the courage and gumption to say, Who am I to send a cold outreach message to Ted hope. And yet, here we are so Ted, I'm beyond grateful. Thank you so much.

Ted Hope

This was a lot of fun. Zack, I really appreciate you inviting me. Thank you.

Transcribed by https://otter.ai