Warner Bros Entertainment

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Warner Bros Entertainment is the division within media giant Time Warner which houses its substantial film and television production and distribution businesses. In recent years it has been one of the world's most consistently successful movie studios as a result of movie mega-franchises Harry Potter, The Matrix, Lord of the Rings/The Hobbit and Batman/The Dark Knight. As a result, it was the #1 studio by US box office for three consecutive years between 2008 and 2010. It reclaimed that position once again for 2013 and has been among the top three every year but one since 2000. The group's equally substantial television production division is responsible for such global successes as Friends, the West Wing and ER as well as more recent hits including The Big Bang Theory and Two & A Half Men.

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Warner Bros Online Warner Home Video
Warner Bros Pictures Warner Bros Television

DC Comics

Castle Rock Entertainment
MAD Magazine Warner Bros Animation

Parent

Time Warner

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 8th Jun 2017: Warner Bros ended a run of critical (though not financial) flops for its DC superhero series with the release of Wonder Woman, which not only received almost universally positive reviews, but also looks set to be a spectacular box office success. It also represents a triumph for female filmmakers, not least director Patty Jenkins. Weekend US box-office of over $100m marked a record opening for any movie directed by a woman, and one of the top three for the year to-date. International markets generated another $122m, making Wonder Woman likely to be Warner's most successful release this year.

Adbrands Weekly Update 18th May 2017: Warner Bros appears to have scored the first movie mega meltdown of the summer with a disastrous opening for its big budget medieval romp King Arthur, from Sherlock Holmes director Guy Ritchie. Industry buzz puts the cost of the flick at around $300m to make and market, but despite a massive national opening across more than 3,700 screens, it took less than $15m at the US box office in its opening weekend. International theatres added around another $29m. Warner got off to a cracking start this year with The Lego Batman Movie and Kong: Skull Island, but its three subsequent releases have been big disappointments. CHiPs and Unforgettable had the benefit of low budgets to recover, but King Arthur makes for an appropriately legendary fail.

Adbrands Weekly Update 5th Jan 2017: Final figures for December confirmed a record-year for movie studios in 2016, with total box office reaching a new high of $11.38bn. The year's undisputed champion was Walt Disney. Despite fewer releases than any of the rival majors (just 16 in 2016 compared to 37 from Warner Bros), it topped $3bn in takings, equivalent to a staggering 26.4% share of the market. No studio has ever before even got close to that sum The previous record holder was Universal last year with $2.4bn, or just over 21% share. Disney had no fewer than six of the Top Ten releases, and was the only studio with not just one but three new releases taking over $400m. And that doesn't include the holdover takings from Star Wars: The Force Awakens, released at the end of 2015. Warner Bros came in second for 2016, but more than $1bn behind at with $1.9bn. Fox, Universal, Sony and Paramount made up the next four places.

Adbrands Weekly Update 22nd Dec 2016: The year hasn't quite ended yet but Walt Disney has already set a new record for global box office, having topped a combined total of $7bn earlier this week. That surpasses previous record-holder Universal which hit $6.98bn in 2015. The final surge was led by Rogue One: A Star Wars Story, which scored a spectacular $290m in its opening weekend; less than The Force Awakens this time last year, but significantly better than had been expected. Like Universal and Disney in 2015, Disney and Warner Bros have between them dominated the current year. Disney has no fewer than five of the ten biggest movies of the year, including all of the top four, and that doesn't even include Rogue One. Captain America: Civil War, Finding Dory and Zootopia all topped $1bn a piece, with The Jungle Book close behind at $967m. Warner scored three top ten releases in Batman v Superman, Suicide Squad and Fantastic Beasts.

Adbrands Weekly Update 3rd Nov 2016: In another major blow to major marketing networks, the WSJ reports that Warner Bros and sister business HBO have moved their US digital media accounts - Warner's alone is worth in excess of $250m in billings - from Omnicom's OMD to Merkle, the CRM agency recently acquired by Dentsu Aegis Network.


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Background

Free for all users | see full profile for current activities: By pure chance, the Warner Brothers movie studio and its future partner Time Inc were founded in the same year, 1922. Born into a Polish-Jewish family which had emigrated to Canada in the late 1880s, the four Warner brothers Albert, Harry, Sam and Jack had tried their hands at numerous odd jobs before setting up a travelling Nickelodeon picture show in 1904. They spent their profits buying up a few small cinemas in Pennsylvania and Virginia, before moving into distribution. In 1917, they bought the rights to a book by the former US ambassador to Germany just as America entered the First War. The movie they produced of the book the following year was a hit, and they finally formed Warner Bros Inc in 1922, securing their future with a series of movies starring one of the first dog stars, Rin Tin Tin. Unable to match the box-office successes of the leading studios, Warners experimented with new technology instead, including the idea of making pictures with sound, an idea dismissed by the majors. In 1927 their first "talkie", The Jazz Singer, created a sensation, propelling the company into the top ranks of movie studios. The brothers moved fast to consolidate their position, acquiring one of the country's biggest cinema chains in 1928, followed in 1929 by First National, one of the biggest studios of the silent era, by then in decline. The latter deal gave Warner control of a large studio lot in Burbank which still forms the core of its operations.

Warners enjoyed a series of big popular hits over the following two decades. These included gangster movies in the 1930s with James Cagney and Edward G Robinson, musicals including 42nd Street and The Gold Diggers of Broadway series, and several successes with Humphrey Bogart in the 1940s including The Maltese Falcon and Casablanca. Other stars contracted to the studio included Bette Davis, Errol Flynn and, from the 1940s, Joan Crawford. In 1944, the studio acquired an independent studio which was churning out a string of animated shorts featuring character such as Bugs Bunny and Daffy Duck. The Looney Tunes cartoon series was to provide Warner with one of its longest-running moneymakers. In the 1950s, Warners and other studios were hit hard, first by government pressure to sell off their hugely profitable cinema chains, and then by the increasing threat from television. Warner was one of the first majors to set up a dedicated division to produce TV shows - including Maverick and 77 Sunset Strip - but slipped into loss in 1958. The pressure led to conflict between the brothers, which came to a peak mid-decade after Jack Warner manoeuvred his siblings out of the business, secretly buying up their shares. 

Despite the success of Oscar-winner My Fair Lady in 1964, the studio was acquired by Canadian distributor Seven Arts in 1966, then by Kinney National Service two years later. Kinney was a general conglomerate built up by entrepreneur Stephen Ross, with subsidiaries including DC Comics and Mad Magazine among other diverse businesses. In 1971 Ross spun off his non-media interests as National Kinney Corporation, and grouped the various publishing and entertainment companies as Warner Communications. The group was also bolstered by the acquisition of magazine publisher National Periodical Publications and lens and camera manufacturer Panavision. The film studio scored spectacular successes with The Exorcist and Superman series in the 1970s and early 1980s. In 1976, Warner Communications bought computer games pioneer Atari, which went on to generate spectacular profits for the group in 1981 and 1982, before racking up equally spectacular losses in 1983 and 84. Atari and other diversions were quickly sold off to allow the group to concentrate on its core businesses of movies, music, TV and publishing.

In 1986, both Warner Communications and publishing company Time Inc [see Time Inc profile for background] were among the investors in fast expanding cable and satellite network Turner Broadcasting Systems. To finance his acquisition of MGM/UA's film library, Turner had sold minority shareholdings to more than 30 different cable operators including Time's ATC and what was then Warner Communications. Time and Warner's shared interest in Turner led to more complex negotiations, and finally a full merger in 1989. The deal was very nearly derailed when rival studio Paramount mounted a hostile bid for Time. To protect themselves from predators, Time and Warner took on huge debts of almost $14bn, but these led to massive interest payments which kept the group firmly in the red for most of the 1990s.

It was hardly an obvious match. The differences between the two sides were considerable: one was a sober East Coast Ivy League institution; the other a flashy, even vulgar, West Coast show biz entertainer. But gradually the two sides learned to live with each other, their debt-heavy marriage eventually strengthened by the takeover of Turner Broadcasting Systems in 1996, which provided a bridge between the two extremes and finally pushed the group into profit towards the end of the decade after years of losses. Conflict didn't stop the business from expanding in the meantime. During the first half of the decade, Time Warner acquired and launched a number of magazine ventures, as well as theme park operator Six Flags (sold in 1998 for almost $2bn). Retail operation Warner Bros Studio Stores, a rival to Disney Stores, launched in 1991. The same year, the group debuted cable stations Court TV, Comedy Central and HBO Asia.

In 1993, chairman Steve Ross resigned following a battle with prostate cancer (he died the same year), and after a brief internal power-struggle he was replaced by Gerald Levin. The same year, with interest payments an ever-increasing burden, Time Warner spun off its filmed entertainment and cable interests into a separate company, Time Warner Entertainment (TWE). In a series of complicated deals, it sold small shareholdings in this new entity to Japanese companies Toshiba and Itochu, and a further 25% to telecoms operator USWest, using the cash to reduce its debt mountain. However the relationship with USWest quickly soured. In an attempt to claw back control of TWE, the group swapped its two Japanese partners' shares for holdings in the main Time Warner Inc parent.

The partnership with USWest, subsequently renamed MediaOne, was further strained by Time Warner's announcement that it would acquire all of Turner Broadcasting in 1995. USWest/MediaOne launched a lawsuit, arguing that the Turner business should be acquired by the Time Warner Entertainment entity in which they owned shares, not Time Warner Inc, but the case was quashed. The row was partly offset by an agreement by the two sides to merge Time Warner's high speed internet access network Road Runner with MediaOne Express to create the nation's largest broadband online business, completed in 1998. Microsoft and Compaq each took a 10% stake in Road Runner that year. Time Warner regained management control of Time Warner Entertainment in 1999, after the acquisition of MediaOne by AT&T, although the telecoms giant kept hold of the 25% shareholding. The group also agreed a deal with AT&T to offer local telephone services across Time Warner's cable lines.

AT&T's stake in Time Warner Entertainment went into play in 2002, following the telecoms company's decision to sell its AT&T Broadband division to rival Comcast. In August 2002 the two companies agreed a new restructuring. Time Warner reacquired AT&T's shares for a combination of cash and shares, giving AT&T a 21% stake in a newly restructured Time Warner Cable division. That holding was subsequently transferred to Comcast, following completion of the merger of Comcast and AT&T Broadband. 

In 2004, Time Warner joined the bidding to acquire MGM, breaking up long-running negotiations between MGM and Sony. After initially offering a stock-only deal, TW raised its offer to up to $4.6bn in cash in September, but subsequently withdrew its bid in the face of a higher offer from Sony Pictures. See full profile for current activities


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