20 Oct 001: A US studio’s $70M China Mistake and What they Learned
Lionsgate’s President of International Film and TV Distribution, Peter Iacono talks about what’s necessary to be successful in China as well as Lionsgate’s foray into the Chinese TV market.
Lionsgate made a $70 million dollar mistake in China but luckily learned from it.
Motivational Quotes – Bruce Lee
To encourage them to continue on their path to achieving their own green light.
To hell with circumstances, I create opportunities.
Caryn: Hey everybody, 大家好（Dàjiā hǎo）, this is Caryn McCann, and welcome to Episode #1 of the “China Hollywood Greenlight Podcast.”
Caryn: Hello this is Caryn McCann, the host of the “China Hollywood Greenlight Podcast.” A Podcast about creating and distributing content for both Hollywood and China. Any links mentioned in the Podcast can be found in the show notes. At the end of this interview, I will give you my takeaways. As promised in Episode 0. The Podcast format is, both procedural and episodic. By “Procedural” I mean, I will use the same format by asking each guest the same questions. By “Episodic” I mean, after the interview, I will update you on my own journey to getting my film, TV projects going. So, you can have a room-side seat into what it takes to get a China/Hollywood Greenlight. So, let’s begin.
Before I introduce a very special guest. I’d like to start out with a motivational quote for our listeners. “To encourage them to continue on their path to achieving their own green light.” This is a quote from Bruce Lee, he said, “To hell with circumstances, I create opportunities.”
Now, I would like to introduce today’s guest,
1.5 Billion Dollar Deal
Peter Iacono is the President of International Film and TV Distribution Lionsgate. Lionsgate has one of the largest Independent Film and Television Businesses in the world. Mr. Iacono oversees international distribution, sales, marketing, 3rd Party acquisitions, as well as international format sales and productions. Back in March 2015, Lionsgate sealed a $1.5 Billion-dollar deal with China’s Hunan TV. That deal encompasses film finance, as well as Hunan’s foreign language output deal. And international markets, and a TV production component.
Caryn: So, welcome Mr. Iacono, and thank you for coming on the show today. Why don’t we begin by you telling the audience a little bit more about yourself and your business?
Peter: Okay. So, I am, I’ve been in the film and entertainment business for a couple of decades now. More time than I think I care to admit to. So, let’s just say, a couple of decades. And started off, on a very traditional route, Disney, and Corporate Finance. And then moving to Warner Bros. in Corporate Strategy, and then went to Sony. Where I was President of International Television Distribution. And then moved onto the role of President of International Feature Film Production.
Then I moved to London for a little bit, I was President of ITE. For the last, my goodness the last 8 or 9 years, at Lionsgate, where I am President of International Distribution for the Film and Television Group.
Caryn: Wonderful. Now, why don’t we begin with some questions? I know, no two days are the same? But, just to give the audience some understanding of your job. Can you tell me, tell us 2 or 3 tasks you do every day?
Peter: Sure. And your right, no day is the same. The first thing that usually happens on a typical day usually is you look at your Blackberry – oh sorry – you really don’t call it your Blackberry anymore. That really does kind of date me. You look at your phone and somewhere between 5:30 a.m. in the morning, and 6:00 a.m. You know, you start looking at all of the Emails that have come in. And then there’s usually 1 or 2 crises you have to address immediately. So, usually puts a crisis somewhere in the world, that has to be dealt with. And then, sort of a typical part of a day, in terms of a routine part of the day, because we are in Los Angeles California. And they have offices all over the world. We’ll start, I’ll start on by talking to London, or Paris, or Milan.
And then people who are working in those offices. Catching them at the beginning/end of the Los Angeles day, towards the end of the workday. And then we’ll move to the Latin America office after that. And then we’ll move to the folks who are in L.A. and then, as we get into the evening. We’ll start contacting the folks who are in Australia, and Japan, and Hong Kong, and the Continent of Malaysia. The day moves with the sun. That’s one of the predictable parts of the day, it moves with the sun. And then, there’s any job that happens here in the home office. As well as what’s happening abroad. And so, usually, I’d say that my most important role, is making sure that everybody has what they need to do their job effectively. And making sure that communication is happening effectively around the world.
FEEDING THE PIPELINE
So, also we’ll always be organizing monthly calls with the whole world. Which happens about 0:30 a.m. in the morning L.A. time. So, unfortunately, if we’re late for the people in Hong Kong, and China, and Mumbai. But, that’s super, super, early in the morning, for most people in Los Angeles, California. And also, organizing quarterly meetings where we’re all getting together. But, just to make sure everybody, that communication is working, and that everybody has everything they need to do their job effectively.
And another major part of the job, is? When you are facing and coordinating with production, and our networks. Because we do Starz now. Which is a big, big, part of our strategy, both domestically and internationally. It’s also, greatly enhancing production. And what we are making ourselves. And even making it more attractive for people to work with us on a distribution basis. So, we have a big, big, part of the world. Is, for lack of a better word for it?
Feeding the pipeline, and making sure that all those offices around the world, where people are looking to distribute, Lionsgate Television shows, have a continuity production and supply, it is faced with production, on-going production. We all like to make sure the pipeline production can take on feedback from what is working around the world. Where people from around the world might have noticed to suggest, and questions they may have about productions we have, the on-going shows that we have season after season.
Caryn: Speaking of around the world, that leads to my next question. As I mentioned earlier in 2015, Lionsgate made a major deal with Hunan – the Chinese TV Studio and Film Group. How do you find the Chinese as business partners? And you suggest the listeners find Chinese partners?
Peter: Another excellent question. You know, it’s all, it’s really, really basic. I really hate to say this but there’s no magic to it. It’s hard work and persistence, and diligence. And I’m even going use a little bit of your quote today which was fantastic. Which is you don’t look at the obstacles, you look at how you make opportunities.
Because especially with the Chinese market. There are often times many hurdles that you have to achieve. But, we have a wonderful group. This is led by a woman named, Annie Yim, who is based in our Hong Kong office. And also on the television side, and on the film side. A brilliant woman, Wendy Reeds, who is based in London. And they work very, very, closely together. And are always on the ground, in China, and making relationships, and talking. The thing is always I feel like I’m emphasizing the same point when I answered the first question.
But, really it’s all about dedication and being in tune, and the sensitivity and dedication of being on the ground, in front of people, meeting people, talking about what they are looking for. And you know, listening is a big part of, I cannot underemphasize the importance of listening and communication. And figuring how we can work together. So, and lastly, Lionsgate because they have a supportive executive team, the executive team that’s very focused on the Chinese market. And very supportive of doing forging relationships. And doing innovative deals in the market. So, it all comes together quite nicely.
Caryn: Tell us an obstacle that you encountered on a past project, and how did you overcome it? And what did you learn?
Peter: Oh, really. My biggest obstacle? The biggest obstacle we encountered was a long, long, long, long, time ago. And one that I’m not sure how best to relay it. Except for the fact, that I worked for a company, that had a beautiful, beautiful movie, that was not well received by the Chinese Government. The Chinese Government asked us not to distribute it, around the world, anyway, around the world. And we have invested $50 million dollars in the movie, maybe $70 million in the movie. So, really taking it off the market, and then absorbing a $70-million-dollar loss is not an option. So, we did release the picture around the world. And as a result, we met with incredible resistance from the Chinese government.
For the next few years, and then with anything, we tried to do. I think it was a great lesson learned. One where we all go, and I think the most important part or lesson learned in that was? That we will make mistakes along the way. Or we’ll, you can’t always do things that will make everybody happy. But, the point is, how you recover from it. Subsequently, the lesson that we all learned, was how we brought that relationship back.
Thus how we forged a relationship and made amends. We met with a senior member of the Chinese Government repeatedly. And you know, explained our position, that we had to do what we had to do. And also, acknowledged all of their concerns, and found a way back.
We found a way so we are then making a beautiful movie with Johnny Mo, and everyone is happy. And we got things back up on track again. So, I’d say, it was an incredible obstacle. One we thought we could not, from which we could not recover. And we realized that recovery is all about taking responsibility and acknowledgment and making amends and forging our way ahead and that. And it was a long hard path. But it was quite proof all about we did it.
Caryn: Wow, you definitely have Guanxi with the Chinese Government.
Caryn: Speaking of pain points – if you could magically solve two pain points – what would they be
Peter: Oh, my goodness. Well, I think probably speaking for many content creators and distributors – the biggest pain point right now is – not necessarily the hurdles that one has to go through to have your programming appeal on the original broadcast. In the sense of compliance with custom and content, some concerns. But, right now, there’s an incredibly arduous process to go through. To get things put on the internet. It’s not the compliance aspect. I would love to match with something on the timetable text now. And I think to apply once every 6 months, the things that can be put on it, on internet service.
And we have to have a great many things, that one has to provide. If all things were happy and pride, and quite willing to provide. But, the actual process we have in place, right now. The cataclysmic of it is quite arduous. So, if there is one thing I could wave the magic wand – I could say, oh, we could submit anything at any time, rather than once every 6 months. Please let us submit anything at any time. And we were happy to work with you to address any mal-concerns at anything that we have created. But it would be lovely to have had a dialog with you every day, rather than once every 6 months.
Caryn: Is there a second pain point that you would like to magically solve?
Peter: Oh, my goodness that one was such a big thing.
Caryn: We can leave it at that.
Peter: I think so. The first one was such a gargantuan pain point for like, right now. So, I think right now, many things cascade from that. You know, we do a volume quote on the numbers, if there is anything else we need to manage. The one that’s been quite challenging recently, is that process where we can only communicate every once every 6 months.
Caryn: Okay, well speaking of the future, what sort of future project are you looking for? And what do you think that the Chinese studio broadcasters are looking for?
Peter: I think, you know, the great thing about working at Lionsgate is twofold. I mean, and I will answer this question. Too, I think that at the end of it you might say, hum, did he really answer the question at all? Because you seem to say, the same thing for everything. So, let me, because we’re a very wide and diverse company, and we’re a very entrepreneurial company, we always look at everything. But, our calling card, we have a calling card, and what we are most known for, and what we are best at is? Big drama, high quality, big drama, and it would be wonderful, to be able to figure out a way to make something in China that we could distribute around the world. It would be wonderful to take a Chinese story and perhaps, you know, make that in the English language.
UNSCRIPTED GAME SHOW FORMATS
The language that could be distributed around the world. So, maybe both could take something outside of China. Or maybe looking at a wonderful Chinese story that maybe could be distributed in China, and the region. Because, we are best known for high quality, great storytelling, big drama. That being said, we are also currently right now, looking at something possibly putting some unscripted competition game show formats on, right now, on the Chinese market.
So, it’s very, very, difficult, for information, big-budget drama. So, that’s why I think when I answer the question? It might sound like he’s fishing; it sounds like he’s looking at everything. Because if he’s looking at the biggest, highest quality budget drama. And also, looking at some you know, unscripted competition reality shows. And then he’s covering, he’s looking at everything from soup to nuts. Which there is somewhat an essence of truth because we’re always looking for anything that is unique. Where our calling card is, unique, and of good quality.
Caryn: In what language?
BABY STEPS INTO CHINA
Peter: You know, primarily we do produce in the English language, but we have been looking at getting a foothold in the Chinese market. And so, because this is new for us. Looking at an unscripted show, it’s a lot easier, it’s a baby step. It’s a great, great, first step into that market. And then you know, with luck it can blossom into scripted television shows and feature films.
Caryn: Okay, now I’ve asked you a few questions. But, let me ask you this – what question did I not ask you, that I should have?
Peter: Always my favorite most pressing question. Not one I’m most, both mostly because I don’t know if I have the best answer. But, I think that one question that we always ask us of is – and we wrestle with is this: How do you properly make programming that can work in and around the whole world? And with every month it is, is so unique, and so different, especially the Chinese market, which is a very, very, unique market. And great big and growing.
BIGGEST MARKET IN THE WORLD
Still, one of the biggest markets in the world. And continue to be one of the most dynamic and growing markets in the world. I think we could, what kind of a question, a rhetorical, it’s one I don’t have an answer for. So, a rhetorical question is one that answers itself. And this is the question to which I don’t even know the answer. So, you should, I’m glad you didn’t ask me that question. Because you would have stumped me.
Caryn: (laughs) OK we can save that for my next guest. Thank you for that question. So, the next question is – what advice can you give those aspiring to tap into the Chinese market?
Peter: Very similar to what I said earlier in the interview. It really is about persistence. And being there on the ground. There is no substitute for being on the ground, in the market. And even though, we have a very small office, in Beijing, which we are very proud of and happy. We established a few years ago, about 2 years ago now, our roots, and where we came from was the team in Hong Kong, and the team in London, going all the time.
And I’m talking to people and figuring out how we can align and make a partnership. So, it would be, a beat on the ground. Don’t be shy about it, and don’t thwarted by disappointment or, rejection, or being, don’t happen quickly. Because it is a wildly dynamic market where many times things happen quite brusquely. But, oftentimes, things happen, they look like they happen overnight. But, really they had a very, very, long gestation period.
Caryn: Exactly. Patience is a trait we all need to adopt. Now, my last question is how can our audience keep track of you? Do you have, would you like to mention any social media handles? Upcoming project details, or website links?
Peter: You know, the best website link is, our Lionsgate website, which is – www.lgtv.lionsgate.com and there you can see, that is the best place to see all the up and coming from the global distribution team.
Caryn: Great. Okay well, Mr. Iacono, I just want to thank you for being so generous with your time, your experience, and your expertise. You’ve given the China/Hollywood audience some great advice. Some great stories. And I’d like to thank you again, for coming on the show.
Peter: Well, it was great to be here. I’m so happy that you’ve had me. And if you ever want me back – I’d be happy to come back.
Caryn: Great, great. Well, Mr. Iacono thank you and we’ll see you at the premiere.
Caryn: After each interview, I will mention 3 key points as well as my own takeaways.
- (9:14) You Need to be on the ground, meeting people. And talk about what they’re looking for. So, that’s key.
- (9:23) Listening is a big part. Mr. Iacono couldn’t emphasize enough how important listening is in communication in figuring out how we can work together.
- (11:12) You will make mistakes along the way. The most important thing is how you recover from them.
- Lionsgate is known for its big high-quality dramas. And they are looking for a Chinese story that can be distributed around the world. And Mr. Iacono said shooting in English is a possibility.
- They will take baby steps to get into the Chinese TV market by finding an unscripted competition gameshow format. This could then blossom into making narrative TV shows and feature films over there. So, if you have a competitive reality TV idea – pitch it to Lionsgate.
- Be Original. Mr. Iacono emphasized Lionsgate is looking for unique So, writers, don’t rehash last year’s big hit into some derivative story. Be original.
- Be persistent. Don’t be thwarted by disappointment or rejection or if things don’t happen quickly.
So, that was my first episode. The link to this episode’s show notes and any links mentioned can be found in ChinaHollywoodGreenlight.com/session001
As I mentioned in episode zero – this podcast is both procedural (here I mean – I use the same question format for each guest every week). It’s also episodic in that I tell you about my own journey to get my own green light.
China Hollywood Greenlight Podcast – Episode 001
Peter Iacono, President of International Television & Digital Distribution, Lionsgate
Host: Caryn McCann
Guest: Peter Iacono – President of International Film and TV Distribution – Lionsgate