Exploiting Hollywood 1980

Ed Basti asked his partner, Ms. Zhang, to read the financial data of the "Daily News" given by James Wells overnight. They showed Ronald and Douglas Jr. a pie chart on a computer screen.

The business of "Daily News" can be divided into three parts, the sales revenue of newspapers, the advertising revenue of newspapers, TV stations and radio stations, and the rent of the Daily News Building.

Among these three, the selling price of newspapers is now negative because it was lowered by the previous boss to increase circulation. Advertising revenue has been on a downward trend over the past few years. The biggest supporter of the group's operations is real estate.

The essence of the problem that the newspaper company is facing now is that the real estate business is booming, and the shareholders no longer want to subsidize the newspaper every year, because the newspaper business has not made any contribution to the increase in real estate income.

Advertising revenue from radio and television stations is also shrinking rapidly. The media in New York is very competitive. In the past few years, the three major wireless TV stations have been accumulating strength to acquire or sign contracts with local TV stations. Nationally syndicated programs can be purchased at much lower prices than local stations and can attract much larger advertisers.

Coupled with the rapid growth of cable television stations, WPIX would have been doomed if it had not been backed by New York, the most developed city. The TV station's main source of income now relies on its television broadcast contracts with the New York Yankees baseball team and the New York Giants football team.

Radio advertising revenue has declined slowly but steadily. The number of listeners who have time to listen to radio every year is inevitably shrinking year by year.

"Doesn't it look like a good business?" Douglas Jr. was a little disappointed. He wanted to join a newspaper that could win the Pulitzer Prize, rather than a tabloid like the Daily News that loses one million a year...

"Whether it is worth investing in is related to an individual's valuation of the business. For the same business, some people feel that the future is hopeless, while others feel that the future is bright. They also have different views on how much the company is worth..." Ed Bastian replied with a smile.

"What do you mean?" Little Doug didn't understand.

"You have to ask Ronald, he's the master of investing." Ed Bastian didn't want to overwhelm him.

"What he means is that if I can find a way to make money, then the newspaper and TV station will not lose money in my hands, and it can become a profitable business." Ronald replied with a smile. This is the same as Buffy's keen eye for the Washington Post's rise to fame. When everyone felt that the newspaper was losing money, he was the only one to see the irreplaceable status of the Post.

Of course, from the perspective of Ronald and Buffy, we reach the same goal through different paths. Ronald smiled proudly and explained to Fa Xiaoting.

"For example, in terms of broadcast content, I found that the programs on New York TV stations and late-night theaters are relatively old, and they are all Hollywood black and white films. If we can purchase more Xiangjiang martial arts films and Corman-type B-level exploitation films, there will be many more potential audience. And the cost is not high.

You know, those people who watch movies on TV stations in the middle of the night are not here to enjoy Hollywood classics. They just want to..."

"You just want to see beautiful women and violence, right?" Little Doug thought after thinking, isn't this a coincidence? "There is also Staten Island. Although its purchasing power is not as good as that of Manhattan, it has a large population and there are not many TV stations on the island. As long as WPIX TV station is introduced to the island..."

The two good friends laughed evilly. It seems that this transaction is still done.

"In addition to movies, we also need to stabilize the broadcast contracts of the two major professional sports leagues. I also discovered a phenomenon. Last year's strike deeply hurt TV stations. Everyone is afraid of the kind of TV series that invested heavily in family entertainment in the past.

On the one hand, the average number of TV sets owned by households has exceeded 1, and even more so in New York. More young people no longer watch a TV set with their parents. On the other hand, TV stations are also afraid of another strike, and the ratings of several evergreen TV series have plummeted this year. "

Ed Bastian clicked twice on the computer, and another histogram appeared on the screen. Family Ties, Growing Pains, Blue Moonlight Detective Agency, these evergreen dramas all fell out of the top ten ratings this year.

"What do you have in mind?" Ronald looked closely at the chart. Ed Bastian was obviously prepared. This is beyond the scope of an accountant's work.

"I have noticed that there are some so-called reality shows that are used by TV stations to test the waters. Such programs do not have detailed scripts and rely largely on the performance of the participants, and the cost is also low. There are also this kind of talk shows, which are not No longer limited to late-night male hosts, some TV stations are targeting various drama markets and are also launching various female host shows..."

Ed Bastian gave Ronald some more analysis.

"Go on..." Ronald listened intently. Buffy had told him the secret of investing. Investors and operators are always two different people. You cannot buy a business and then run it yourself. Before making an acquisition, you must first ensure that their management team is excellent and stable.

"As for radio, I have noticed some recent advertising in New York City. There are two markets worth noting... One is classical music. Loyal audiences listen for a long time every day, and their purchasing power is also attractive enough to advertisers. .

Another similar industry is the radio station that broadcasts traffic conditions. Many people who need to commute will pay attention to it on time when commuting every day..."

"Where's the newspaper? What do you think?" Ronald asked again.

"I want to do the opposite, increase the selling price of each newspaper and reduce the cost of color printing. Only such readers will have enough money to buy advertisers' products. Instead of throwing it away after reading the magic story every day..."

"Puchi" Ronald couldn't help laughing. The "magic story" he mentioned is the nickname given by New York citizens to the fake news made up by the Daily News. The typical story is that a multi-millionaire mysteriously drowned, his property disappeared completely, his daughter was desperate, and suddenly a young and handsome guy knocked on her door.

"How much does it cost for us to buy all the media businesses of the Daily News?" Little Doug began to calculate. In this transaction, Ronald was responsible for solving the program problems of the TV station in the future, and he was responsible for solving the broadcast tower of the TV station and radio station on Staten Island, because his family was a landlord, and many TV station facilities suitable for construction were on his family's land. The two of them jointly invested and introduced some familiar Wall Street capital. This was secondary to making money from buying and selling. Increasing the media influence of the two was something that a lot of money could not buy.

"If we divest the real estate and sell it now, it may cost 50 million to 100 million," Ed Bastian pressed the keyboard, and an acquisition plan appeared on the last page, giving an estimated price.

"Is that so?" Ronald thought about it. If the two of them wanted to raise the money, they would have to sell some assets or find Wall Street people like Bannon to borrow money.

"Of course, a better way is to be a patient hunter and wait for the right time..." Ed Bastian turned another page.

Among the three media, the most valuable is WPIX TV. His broadcasting contract with the two major professional sports teams in New York is about to expire. If there is a problem with the renewal at that time...

"But in that case, will there be competitors?" Doug asked.

"No... Not every operator has such a forward-looking vision. The Daily News has been begging for so long before..." Ronald looked at Ed Bastian, a partner of Pricewaterhouse's New York branch and his own accountant. He had previously rejected a job offer from PepsiCo, and it seems that he was not just dissatisfied with the low income...

"Let me talk to Ed alone..." Ronald winked at Doug.

Ed Bastian also winked and asked his assistant Miss Zhang to leave.

"After the merger, I invite you to be the general manager of the new Daily News. Are you willing to accept?" Ronald made the offer straight to the point. Ed Bastian has excellent professional ability and became a partner of Pricewaterhouse at the age of 31. He is also a good person. During the internal review, he found a bunch of worms, otherwise he would have become a partner a few years earlier.

Such an outstanding talent, since he has done so much homework, it is conceivable that he has ambitions for this. It just so happens that the people in Ronald's pocket are mainly artists, and such business talents are in short supply.

"Of course, I thought I still need to recommend myself..." Ed laughed.

"One advantage of talking to smart people is that you don't have to worry about all kinds of politeness. I'm curious, why are you not interested in the vice president position that Pepsi invited you to be? Instead, you are interested in my newspaper."

"If you weren't my client, I might have accepted the invitation..." Ed Bastian said his thoughts with a smile. First, Ronald brought him a lot of income. He is the eldest son in a family of six children, and he wants to give his brothers and sisters a chance to receive a good education.

Second, Pepsi is already a well-established large enterprise. If you go there to be the vice president of an international business unit, or if you are parachuted in from an accounting firm, you will be constrained in many places. How can it be as comfortable as Ronald's position as the general manager of a media company here?

"I will give you the highest industry treatment, and if you manage well, you will also have corporate options. You continue to improve your ideas for running the business. As for the timing of the acquisition, we have to wait patiently..."

Ronald and Ed Bastian agreed on the terms of cooperation. The other party happily shook hands with Ronald again. He will now prepare for various acquisition investigations and subsequent business routes.

"By the way, what is the software you use to display pie charts and bar charts?" When sending him out, Ronald pointed to the software on the computer and asked him. This feeling was very familiar.

"It's Microsoft's PowerPot. It's very convenient, isn't it? Miss Zhang is an expert. Originally, we had to shoot this demonstration with film, and it would take at least until tomorrow to be ready."

"Microsoft?" Ronald thought that he should continue to increase his position.

He invited Douglas Jr. in again and told him that he was going to hire Ed Bastien.

"There is one more thing. I will agree to the Daily News's request for help and allocate $500,000 in advance to help them survive the rest of the year. The acquisition of media requires government approval. Can our friends provide support?"

"In terms of acquisition review, we can ask George Jr. to come forward to smooth things over at the National Communications Administration. In terms of local government, I plan to ask Mr. Congressman from Staten Island to come forward. The mayoral election is very fierce now. I don't know who will be the next mayor. If we bet now, there may be problems." Douglas Jr. also thought of the route.

"Very good, we will quietly prepare and wait for the right time..."

The acquisition team was quietly formed, and Ronald's personal lawyer Lindsay Doll and Mickey Kanter also participated. In addition, Bannon was also interested in this. In addition to wanting to join in a small share, he also used his relationship on Wall Street to get bank credit.

"TV stations are the future, Ronald, the future." Bannon was very excited. After he successfully shot a movie in the film and television industry, his old friends on Wall Street regarded him as a rare banker who understood Hollywood. Many people used him as a broker to find investment targets for the fund.

Wall Street funds seek stable returns. Compared with the box office gambling of movies, they prefer the stable returns of TV series.

So Bannon himself also got some TV series projects and wanted to sell them to the three major wireless TV stations. But so far, there has been no success. He was very happy when he heard that Ronald was going to buy a TV station. Having an acquaintance in the TV industry makes things much simpler.

"You don't know how popular TV series are now. I invested in a comedy TV series, which I think is very good. The TV station has asked us to shoot a pilot episode to test the waters. Those old TV series are slowly dying out, which shows that change is coming..."

"I don't know as much about TV series as you do now. If our acquisition is successful, you have to provide more TV series for our TV station to broadcast..." Ronald felt very comfortable when he saw the other party's confidence. Wall Street scammers have to be so confident...

"Ronald, do you want us to focus on the case with the Japanese game manufacturer Capcom, or on your future acquisitions?"

Lindsay Doll, the lawyer, came to Ronald to ask about his plan. After all, they are still a small law firm, and Mickey Kanter's business strength is not much. If Ronald wants to go both ways, they have to introduce more manpower.

"The acquisition has not started yet, so should we settle the Capcom matter during this period?" Ronald didn't understand and discussed with his private lawyer.

"Transnational lawsuits consume a lot of manpower. We sent someone on a business trip to Tokyo, and it takes a long time to go back and forth. If we don't increase the manpower, I think we should focus on solving one problem first. What do you think is the order?" Lindsay Doll's interests are on Ronald's side. She doesn't want Mickey Kanter's people to increase indefinitely.

"Lindsay, in your opinion, how long will it take for the case with Capcom to make substantial progress? How likely is it that they will reach a settlement?"

"The jurisdiction can be fought for a year. Their company is not very big, and this is their second best-selling game. Of course, they hope to drag it out as long as possible. The possibility of a settlement is not great, because for Capcom now, a settlement means taking on potential risks when the company is developing rapidly. They have copied Hollywood in more than one game...

In addition, the Japanese government is actually quite hostile to our American companies. Their Ministry of International Trade and Industry always wants to close the domestic market, and we have a long history of suffering losses since World War II.

So, I don't have much hope that this case will be resolved in a short time."

"Well, then I'll listen to you. Focus on the acquisition case, and find someone over there to follow the normal process." Ronald has great confidence in Lindsay's professional ability. With such a lawyer who started from humble beginnings to help watch over, he won't be deceived too much by other lawyers.

"Okay, then I'll call Gray Eyes Mickey and inform him of your attitude. I have to go, my child is still being looked after by a nanny..." Lindsay stood up and said goodbye.

"Wait a minute, you just said Capcom is in a period of rapid growth, so they are not very strong now, right?" Ronald suddenly remembered something.

"Yes, they just merged with two other game manufacturers, and the branch in America was established not long ago. I estimate that according to their development speed, if they can develop another successful game like this, they will be qualified to be listed on the venture capital board of the Japanese Stock Exchange."

"Soga, so compared to suing, is it easier for us to acquire them?"

"This?" Lindsay didn't expect Ronald's idea to be like this, "American companies have many restrictions on acquisitions in Japan, but that is for listed companies. For start-ups like this, it is not without opportunities..."