[Chapter 779: Report Card]
With the viewership surge from the releases of Sex and the City and the second season of America's Next Top Model, Lifetime Television seized the opportunity to launch several other original series.
Although these new shows did not match the ratings of the frontrunners, they filled the evening slots effectively, avoiding the previous fall's awkward silence when Project Runway and America's Next Top Model had galloped ahead while other time slots remained desolate.
As Lifetime began negotiating new revenue-sharing contracts with cable operators with renewed confidence, other media groups closely monitoring Lifetime initiated their own analyses of the network's rise. Sure enough, they planned to follow suit. This trend was not only visible in the film industry but also among the three Firefly companies that were gearing up for the FFM cable channel, which was also looking to follow the HBO model.
However, despite the booming cable television industry at that time, Eric did not worry about these latecomers. But, where capital firmly controlled every industry, there were not many willing to invest decisively while the situation remained uncertain. By the time they caught on, Lifetime would already have solidified its position in the industry.
...
The early months of the year were when major corporate giants presented their "report cards" to investors, media, and the public.
Having implemented a successful "blockbuster strategy" last year, and backed by the robust recovery of the U.S. economy, Time Warner's total revenue reached $11 billion in 1995. However, out of the 25 films released that year, only Batman Forever turned a profit, with a $100 million investment, grossing $330 million globally, along with substantial merchandise profits. Unfortunately, several big-budget projects costing over $50 million ended poorly.
Most notably, Waterworld, with a staggering $175 million production cost, barely earned over $80 million at the North American box office. Although it grossed $260 million worldwide, due to the generally low take and high taxes in international markets, Warner Bros. recouped just over $90 million from its global box office share, resulting in a loss exceeding $100 million for the studio on this project alone.
While the Turner Broadcasting System and HBO under Time Warner were highly profitable, they could not compensate for significant losses in the film division. Ultimately, the entire group saw losses of $280 million for the year, more than triple that of the previous year. When the financial report was released, turmoil erupted again within Time Warner. Ted Turner, founder of Turner Broadcasting and major stakeholder in Time Warner, even suggested splitting the company during a board meeting -- a remarkable turn given the recent trend of resource consolidation that some board members supported.
Viacom, firmly controlled by Sumner Redstone, also reported revenue exceeding $10 billion for the year, largely thanks to Blockbuster's strong rental and retail performance. Their revenue reached $10.7 billion, making them second only to Time Warner. However, unlike Time Warner's substantial losses, Paramount managed to achieve a net profit of $760 million for the year.
If we are to discuss comprehensive strength, the News Corporation, which encompassed a vast operational reach across the Western world, was comparable to Time Warner. However, the complexity of its financial and equity systems -- the businesses in various countries often operated independently -- made it difficult to consolidate. Thus, the subsidiary handling domestic film and television business, 20th Century Fox, effectively represented the corporation. This led to a similar standing between 20th Century Fox and Universal controlled by Seagram and Columbia controlled by Sony, not to mention the rapidly recovering MGM.
In early months, American media gradually recapped the performances of the six Hollywood giants but waited anxiously for the annual report from Firefly Group.
...
Despite the media's anticipation, which almost turned desperate, after several discreet board meetings and negotiations with main creditors, upper management ultimately decided not to release Firefly Group's financial report.
For a non-public company, releasing financial data usually had clear objectives. Last year, Firefly had published its financial data due to issuing an enormous $8 billion bond as it was not yet fully integrated after acquiring ABC Group, alongside Ron Perelman's purchase of Firefly bonds. These measures aimed to prevent unnecessary speculation and concern from the capital markets.
This year, however, everything within the group had returned to normal, free from internal and external troubles, thus there was no need to indulge the curiosity of the capital market or the media by engaging in such superfluous acts.
Of course, Eric's desire to remain discreet was another significant reason.
After months of financial calculations, Firefly Group's annual revenue ultimately stood at $23.9 billion, achieving an operational net profit of $2.57 billion. When considering subsequent payments from the sale of ABC's print media assets and Disney's animated studio, totaling $1.25 billion, Firefly's net annual profit reached $3.82 billion. This figure alone was enough for Firefly to boast to the other six, saying, "Come at me."
In comparison, Ford Motor Company -- the highest profit generator among American enterprises in 1995 -- reported a revenue of $128.4 billion with only $5.3 billion in net profit. Even without including Firefly's $1.25 billion non-operating revenue, its $2.57 billion net income comfortably placed them among the top ten American corporate profit rankings.
The detailed annual financial data was known only to Firefly Group's board and core executives, and even key creditors had a general understanding but wouldn't disclose anything to the media.
Thus, relying on publicly available data from box office earnings, television ratings, and other measures, the media and analysis agencies could predict that Firefly Group's earnings would be staggering. Yet, lacking specific data meant they could only estimate based on what was known.
Without Firefly's official endorsements, even if these media predictions were close to reality, they wouldn't gain widespread acceptance. Some members of the public, upon seeing the staggering financial figures attributed to Firefly in financial magazines, instinctively questioned the accuracy of those numbers. After all, if nearly $4 billion in annual profit was genuine, Firefly's earnings alone could rival those of the other six combined. Achieving such a feat would have never happened in Hollywood history, single-handedly capturing 50% of the entire industry's profits.
...
Amid this uproar, the release of Forbes magazine's 1996 Billionaires List sent shockwaves through the media.
After the launch of Windows 95, buoyed by Microsoft's dominance in the operating system arena, Bill Gates, who owned 40% of Microsoft, saw his net worth soar from $12.9 billion last year to $18.5 billion. Following him were Warren Buffett and three other billionaires who also crossed the $10 billion threshold.
However, the standout figure on this list was that remarkable $67.7 billion -- Eric's wealth had skyrocketed by $21.2 billion in just one year, up from $46.5 billion last year.
Upon the list's release, Forbes president Steve Forbes penned in the magazine, "If six years ago Eric Williams had risked his entire net worth on the Kuwait War, it would have been regarded as a reckless gamble. However, Eric has proven over the years that not only does he possess remarkable talent in film and media, but as an investor -- he has exhibited an exceptional insight that is hard to match.
Since investing in Yahoo in 1991, Eric has steadily allocated nearly $5 billion to emerging technologies and high-tech industries over five years. Today, those investments have quadrupled, now valued at over $20 billion.
While Eric Williams' investments in high-tech sectors appear very successful, it's undeniable that the increasingly formidable Firefly Group remains his true foundation. Over the years, the consistent and significant profits from Firefly have empowered Eric to exercise his prowess in the investment world.
Unlike publicly held corporations like Time Warner and Viacom, Firefly Group did not release its 1995 annual financial data. However, based on accessible public information, Firefly's total revenue for 1995 should be around $24 billion -- surpassing the combined annual revenue of Time Warner and Viacom.
As for profitability, Firefly Group's earnings capability is even more astonishing. Compared to Time Warner's $280 million loss and Viacom's $760 million net profit, Firefly's operational net profit for 1995 should fall between $2.3 billion and $2.6 billion, which is equivalent to four times that of Viacom and nearing the total profits of Time Warner, Viacom, 20th Century Fox, Sony Pictures, Universal, and MGM combined.
This astonishing profit capacity makes one wonder if the IRS might really consider imposing a 'space immigrant management tax' on someone. Just kidding."
...
With the new Forbes Billionaires List going public, the media could not help but engage in discussions. The most immediate impact occurred on the day of the latest issue's release when the magazine detailed Eric's investments in high-tech industries and their returns -- the NASDAQ index reacted quickly, surging 5% that day, with many tech stock stars including Cisco, AOL, and Microsoft even rising over 10%.
Forbes magazine maintained high credibility, and compared to other financial publications' exaggerated or conservative estimates of Firefly Group's earnings, the data published by Forbes gained significantly more acceptance.
The ongoing explosion of the global film market and Hollywood's territorial expansion were almost common knowledge, yet seeing the terrifying profitability of Firefly Group only left many investors undeterred by Warner Bros. and Sony Pictures' losses, and they still flocked towards Hollywood.
...
Amid this atmosphere, the 68th Academy Awards took place on March 25 at the Shrine Auditorium in Los Angeles, just as expected.
Although Eric received his usual invitation, he opted to stay absent. After all, sitting still for three hours at the Oscars was hardly enjoyable, especially since Firefly only garnered a few peripheral nominations this year, rendering his attendance unnecessary.
Drew, who had already started looking for a gown, also declined her invitation upon hearing Eric's decision. The two chose to snuggle up at Drew's luxurious Beverly Hills home and watch the live broadcast.
The script for The Shawshank Redemption remained untouched in the corner, and thankfully, there were no Oscar snubs this year.
Aside from the favorite, Forrest Gump, the other nominated films such as Apollo 13 and Babe did not show the same heat or impact to rival it.
Ultimately, Forrest Gump, with 13 nominations, swept Best Picture, Best Director, and four other awards. Tom Hanks successfully defended his title as Best Actor, creating a new milestone in Oscar history.
...
Though not present at the ceremony, celebrations were certainly on the agenda.
Since Firefly and MGM had collectively received major nominations primarily for Forrest Gump, it seemed unnecessary to hold a separate celebration. Moreover, after receiving a personal call from Tina Brown, the former editor-in-chief of Vanity Fair, Eric decided to hold tonight's celebration at the Oscar party hosted by Vanity Fair.
The party was set in an arts center below Beverly Hills, just under five miles from Drew's estate in Trousdale Estates. Eric and Drew were in no rush; they finished watching the awards live broadcast before heading to the party.
Shortly after 9 PM Pacific Time, the car pulled into the parking lot outside the arts center. As soon as Eric and Drew stepped out, the media reporters lurking outside surged forward, their bright flashbulbs going off in a frenzy.
Interviews inside the Vanity Fair party were strictly off-limits to the press, but outside, the organizers had no control.
"Eric, do you think the numbers released by Forbes are accurate?"
"Mr. Williams, what's your take on Tom Hanks winning the Oscar for Best Actor again?"
"Was there any PR involved in that?"
"Eric, how is your new film coming along?"
"Drew, do you and Eric have any plans to get married?"
"When are you planning to have kids?"
"..."
Eric and Drew merely smiled at the cameras amidst the cacophony of questions. A cluster of bodyguards and the event's security swiftly gathered around to escort the pair into the party venue.
*****
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