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--:-- Noelle King: On Sunday, Game of Thrones fans, and also HBO hopes people who never watch Game of Thrones, get to return to wild, wild Westeros for more politicking, more Iron Throne grabbing, more backstabbing, more frontstabbing, more wildly distressing sibling relationships. Also, there be dragons. They are power men should never have trifled with. House of the Dragon is a prequel to Game of Thrones. It's centered on the ice-blonde, ice-clutched Targaryen clan and set 200 years before Queen Dany loses her mind and burns it all down. But some things remain constant. I have decided to name a new heir. I'm your heir. If you watched Game of Thrones, you will not be shocked to learn the family rivalry ends up destroying so much. Coming up on Today Explained... War is a foot.
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--:-- Noelle King: Support for Today Explained comes from BetterHelp. Let me tell you a true story. Last weekend, I got an email from a listener who wanted to discuss their problems with me. And I said, look, I don't think that this is about me personally. At least I hope it's not. Why don't you try BetterHelp.com slash Explained. Absolute truth. As the largest online therapy provider in the world, BetterHelp can provide access to mental health professionals with a diverse variety of expertise. Find the one with BetterHelp. The one is not me, guys. Our listeners get 10% off their first month at BetterHelp.com slash explain. That's BetterHelp.com slash explain.
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--:-- Noelle King: Support for this show comes from Macy's. Layering is an art form. All it takes is a bit of intention, style, and, of course, the perfect cold weather staples. So find the perfect look for you with the help of Macy's Fall Fashion Guide, your one-stop shop for fall's latest trends and must-haves, curated by their experts. From leather to denim to cozy knits, find everything you need to piece together your new fall look. Explore the Macy's Fall Guide for yourself and shop in-store or online at Macy's.com.
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--:-- Noelle King: When people ask you what happened here, tell them the North remembers. It's Today Explained. I'm Noelle King. James Hibbard, writer-at-large for The Hollywood Reporter.
--:-- James Hibbard: Did Game of Thrones really change television? Absolutely. It is arguably the biggest show of the 21st century so far and completely changed what was considered possible in television. Season 8 of Game of Thrones has averaged 44 million viewers per episode. An HBO fantasy epic Game of Thrones also made Emmy's history, winning the most trophies ever in a season, including the top prize for best drama.
--:-- James Hibbard: First was, like, the level of production. That's the most obvious, right? It's like the battle sequences in the latter seasons of the show are just as good, and I think actually in some cases better, and certainly more coherent than what you often see in big-budget movies. I will not give my life for Joffrey's murder, and I know I'll get no justice here. And absolutely unlike anything done on TV before.
--:-- James Hibbard: And after Thrones, you saw this jump in budgets in terms of what companies were willing to spend. HBO spent $15 million on each individual episode of the eighth and final season of Game of Thrones, making it the most expensive series on television at the time. In fact, a single season of television can exceed $150 million now. For comparison, that is about the total budget of the new Spider-Man movie currently in theaters.
--:-- James Hibbard: There was also, and this is something most people miss, is the level of storytelling complexity was very groundbreaking. The show started very complex, and critics complained early on, it's so hard to follow. And by season five, the show is jumping between eight different storylines. You know nothing, Jon Snow. What they found is that fans actually liked that. They liked having this really meaty story that challenged them and that required, you know, a lot of dedication and thought.
--:-- James Hibbard: And then, of course, it was in terms of its genre, you know, fantasy, especially R-rated adult fantasy. That wasn't considered a genre that could attract a broad audience. I mean, there was The Lord of the Rings, but those were massive movies that were also family friendly. I never thought I'd die fighting side by side with an elf. What about side by side with a friend?
--:-- James Hibbard: And since Thrones, there's been this explosion in fantasy projects like The Witcher and Wheel of Time and Shadow of Bone and his dark materials entering the ring, so to speak. So millions of people, myself included, were wildly disappointed in the Game of Thrones finale. A Change.org petition that's calling for a remake of season eight has more than a million signatures. The creator of the petition has demanded a do-over with, quote, some competent writers.
--:-- James Hibbard: Do you get the sense that that response is at all shaping how HBO has gone about making this new show? To some degree. I think the season eight disappointment, along with the rejection of the other Thrones prequel pilot that was in the works before House of the Dragon that was shot for $30 million and then scrapped. I think both of those things together were reminders to everyone involved, just how high the bar is for executing a drama in George R. R. Martin's fantasy world.
--:-- James Hibbard: I think it really lit a fire, so to speak, among all those involved in Dragon to know that this is not just another show. This is a make it or break it project. And the expectations are going to be sky high. And if it doesn't work, they're never going to hear the end of it.
--:-- James Hibbard: What's the space that HBO is hoping to fill now that there are so many of these big budget fantasy series? Well, the show ended right as streaming was really starting to take off as this massive of competitive thing. So you had two things going on at the same time. You had companies wanting to build up their streaming subscriber lists. And at the same time, you have a show like Game of Thrones setting this example of here what an epic show really needs to be.
--:-- James Hibbard: There is only one war that matters The Great War. And it is here. So I think that really boosted and incentivized companies to invest in content to an extent that they never had before. And in terms of what hole they're looking to fill, they're looking to fill the Game of Thrones hole. They're looking to fill the hole on their platform that was created when Game of Thrones went off the air sooner than they wanted it to go.
--:-- James Hibbard: And now they don't just have the HBO Sunday night slot to fill. They have HBO Max to fill, which isn't constrained by a linear schedule where you only have a couple nights to program. So that is very much what they're trying to do.
--:-- James Hibbard: How realistic is it that we're all going to end up watching House of the Dragon, do you think? I don't think anyone's expecting the numbers that we're watching Thrones to watch House of the Dragon. What HBO needs Dragon to do, they're not going to be specific about the number it needs to hit. I'm sure they internally have a certain number that they're looking for it to do.
--:-- James Hibbard: I think the odds of it getting a second season, no matter what, are pretty high because they're going to figure that it's better to keep going in hopes that the audience will build than to cut it off after one season. So, I mean, ultimately, they want to see a number that's high enough that incentivizes them to not just renew it, but also to greenlight one of the other seven or eight projects that they have in development that are also Game of Thrones spinoffs.
--:-- James Hibbard: And that's the real key. Oh, my God. They have that many? Yes. Yes. They have four scripted and at least three animated. It. And I mean, of course, no one will say their fate hinges on Dragon. You know, the refrain is they judge each project by its own merits. But of course, they hinge on it. If Dragon flops, the odds of HBO investing in another live action Game of Thrones show anytime soon go way down, especially with the recent cutbacks.
--:-- James Hibbard: And if Dragon is a hit, greenlighting one of those other eight projects is going to be extremely tempting. So potentially decades of content hinge on this show, not just one show. What would you say right now is going to be this show's big competition? Well, the most obvious one would be Lord of the Rings. It's estimated Amazon acquired the global TV rights to the series for as much as $250 million.
--:-- James Hibbard: Which is so ironic, because George R. R. Martin wrote his A Song of Ice and Fire novels to be a sort of reality check response to the Lord of the Rings. Like, what if you did the Lord of the Rings, but people acted like human beings actually did during the Middle Ages, instead of acting like the heroic knights in shining armor that they do in Tolkien's land? Tolkien did certain things that are different than what I would do.
--:-- James Hibbard: And in the hands of some of the Tolkien imitators, those things have become cliches that I think have ultimately harmed the genre and made people think that it's, you know, entertainment for children or for particularly slow adults. Now you have Amazon making The Lord of the Rings in response to the success of Game of Thrones. That they're going to be rolling out episodes at the same time is almost bonkers.
--:-- James Hibbard: What happens if House of the Dragon is a flop? What are the stakes for HBO? What are the stakes for fantasy if people hate this thing? The stakes are pretty high for HBO and Warner Brothers Discovery. HBO needs more tentpole shows. And, you know, as we talked about, this isn't just one show, but a potential franchise like Disney has with Marvel and Star Wars.
--:-- James Hibbard: Streaming is the business of selling addictive distraction, right? And if you have one show that people love, then you have subscribers hooked for three months out of one year. And then maybe they come back after a year or year and a half passes. But if you have a franchise that has interconnected content and you keep greenlighting shows, then you have potentially a situation like Disney Plus has with Marvel and Star Wars where there's always another Marvel and Star Wars show coming within a few months.
--:-- James Hibbard: So that way you keep people subscribed and it goes on and on and on. And that's definitely what HBO wants. It is also what HBO's parent company wants. After the break, Recode's Peter Kafka tells us about a sort of real-life Game of Thrones playing out at Warner Brothers Discovery.
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--:-- Noelle King: Support for today's show comes from Adio. What is Adio? Adio is an AI-native customer relationship management system built specifically for the next era of companies. They say it's extremely powerful, adapts to your unique data structures and scales with any business model. According to Adio, Adio takes less than a minute to set up. And within seconds, you will have your email and calendars synced. You'll see all your relationships in a fully fledged platform, they say, all enriched with that actionable data.
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--:-- Noelle King: It's Today Explained. I'm Noelle King. Peter Kafka, senior correspondent at Recode and Vox covering media and technology.
--:-- Peter Kafka: There are so many media companies and I going to start by telling you I don't understand who owns who. Join the club. We made a map, by the way, that shows all this stuff. Oh, tell me about the map.
--:-- Peter Kafka: We literally made a sort of constellation of planets, and they all represent big media distribution companies. And what's happening is the big things are getting bigger. They're slowly absorbing the smaller things. And in this case, you've got Discovery, which was one of the smaller players in media, has absorbed the thing that used to be called Time Warner, which was one of the mightiest media companies on the planet.
--:-- Peter Kafka: It's been shrunk over time. Most recently, it was owned by AT&T, the giant phone company. AT&T bought it in 2016, finally owned it in 2018. And then in 2021, AT&T said, actually, we don't want to own a giant media company. We're going to hand it over to Discovery. And that is why Discovery now owns a thing called Time Warner. And the entire new company is called Warner Brothers Discovery. Simple, right? Easy to understand.
--:-- Peter Kafka: All right. Tell me about Warner Brothers Discovery CEO David Zaslav. Zas is a cable guy. I love the cable industry, and so my energy level is higher. I'm reading about it even in my part-time because that's what I love. He's a lawyer who went to work for what was then called NBC Universal and helped them put together all their distribution deals for their cable networks.
--:-- Peter Kafka: So you could watch things like the sci-fi channel and USA Network, or you could pay for them whether or not you wanted to watch them. And eventually he got put in charge of Discovery, which is the group of cable networks that brings you things like 90 Day Fiance and other reality shows.
--:-- Peter Kafka: We're almost to the end of the 90 days and now he's questioning things and I feel like, yeah, it's a short amount of time, but I've always been honest about who I am. He is not a programmer. He's not a creative guy. He's a deals guy. He's a manager. A couple years ago, he bought another cable conglomerate called Scripps that also does reality TV, put those things together.
--:-- Peter Kafka: 50 to 60 percent of the content that people consume is not scripted series or scripted movies. So for us, it's home, food, discovery, Oprah, crime, Chip and Joanna Gaines. And he gets paid really well because the stock keeps going up. He made a couple hundred million dollars in salary one year alone. But he has always wanted to be a full-fledged media mogul.
--:-- Peter Kafka: Ambition is the willingness to kill the things you love and eat them in order to stay alive. Haven't you ever read my throw pillow? He gets paid like one. He hangs out with them. But he has never gotten really the sort of respect in the industry. Up until now had been not considered a titan of industry. And if you wanted to play armchair psychologist, you could say he really, really wanted to be taken seriously, not just as a guy who operates reality TV networks, but as a serious titan of media.
--:-- Peter Kafka: What is he known for at Warner Brothers Discovery so far? What big moves has he made? Well, the first thing he did is he came in after a guy named Jason Kylar, who's ran Warner Media under AT&T for a couple years and caused a lot of agita within Hollywood because he was pushing to really turn the thing from an old line media company into a new line media company, which really meant he wanted to make the thing into a Netflix.
--:-- Peter Kafka: And that gave people a lot of angst, in particular a move he made during the pandemic to say all of our movies that are supposed to go into movie theaters in 2020 and 2021, we are going to actually bring them to streaming right away. The world is changing and that's the way the world's supposed to work. And so we're going to obviously adapt to that and in many ways lead the charge there.
--:-- Peter Kafka: Lots of people, including directors and actors and agents, all freaked out about that. The greatest contributions we can make as filmmakers is to give audiences the motion picture theatrical experience. I'm a firm believer that movie theaters need to be around forever. So David Zaslav comes in and says, well, all of that is out the window. I'm going back to the old ways. I love Hollywood. I love creative people. I love all of you.
--:-- Peter Kafka: And I believe that he believed that. But on the other hand, I think people were a little naive because when you merge companies, you always have to cut costs. In this case, David Zaslav had promised Wall Street He would cut $3 billion in costs. And if you just think about it for a second, that means he's going to have to lay people off and shut down projects. And sure enough, that is what he's doing.
--:-- Peter Kafka: The first thing he did was kill something called CNN Plus. Well, CNN's new streaming service, CNN Plus, is shutting down less than one month after it launched. CNN's new management made that decision after the site attracted fewer than 10,000 daily active viewers.
--:-- Peter Kafka: More recently, HBO has started disappearing. Some of its movies that you probably don't remember existed, but were still out there. There was actually a good one called American Pickle, a remake of a movie called The Witches with Anne Hathaway. These are all things that HBO Max had commissioned as HBO Max streaming movies.
--:-- Peter Kafka: And apparently not that many people were watching them and no one thought they would notice. And they just said, if we just take them off our service, we don't have to pay anyone for them anymore. We're going to cut that. He recently killed off a movie that's finished. It's a superhero movie called Batgirl. The company decided to shelve its $90 million Batgirl movie rather than release it on streaming.
--:-- Peter Kafka: A lot of backlash there. But I hearing this is due to a number of factors including the fact they did a test screening and the reaction by fans was not positive. We just started this week seeing layoffs first at HBO but they going to run throughout the entire Warner Media Discovery company for the next couple of months. You'll see layoffs at unit after unit after unit.
--:-- Peter Kafka: Why does Zazz have to cut costs? Warner Media and Discovery seem like successful brands. What am I missing? When you buy a company, generally you don't say, this company is great, we're going to not touch it. And even if you say that, by the way, you touch it.
--:-- Peter Kafka: And when you merge two companies that are doing the same thing, it is both reasonable to assume, and you definitely have to tell Wall Street, you say, we're going to make these two companies better by pushing them together. And one thing we're going to do is cut costs. He's also taken on a ton of debt that came with WarnerMedia when he bought it. He's got $53 billion total in debt that he's got to bring down eventually.
--:-- Peter Kafka: So he does have to find ways to pay that off as well. Between the consolidation, the viewers dropping off, the people going back to the movie theater, maybe. How is all of this affecting other streamers in the industry like Disney Plus, Apple TV Plus? So there's two groups to think about. There's the people who are in the business of selling media. That's Netflix. That's all of the old traditional media companies.
--:-- Peter Kafka: And for the last five years or so, Netflix has been king of the world and everyone in traditional media has been trying to contort themselves into a Netflix company. That's Disney, that's Warner, that's everyone. And the question there is, how do you build up enough scale to keep up with Netflix? Netflix is spending $18 billion a year on content. How are you going to keep up with them? They've got 220 million subscribers. They are the future.
--:-- Peter Kafka: That was the conventional wisdom up until late last fall. And then you can sort of insert a record scratch sound. And all of a sudden, Netflix's numbers start looking not so good. And Wall Street starts to sour on Netflix's grow, grow, grow, but don't make so much profit model. And then at the beginning of this year, Netflix freaks everyone out and says, not only is our growth slowing, which was the whole point of our company was to grow, grow, grow. We're actually losing subscribers.
--:-- Peter Kafka: Netflix is losing subscribers for the first time in a decade. The platform lost 200,000 subscribers in the first three months of the year and expects to lose 2 million more in the second quarter. And so what you see then is something that I've been calling the Netflix chill. You can think of it as a cold that is now sort of, or a contagion that's affecting the rest of the media business.
--:-- Peter Kafka: They are all saying, oh, this thing where we're supposed to grow our streaming business because that's the future. We're no longer getting rewarded for that. We kind of have to go back a bit to what we were doing. So that's one answer. And the other answer is you have Amazon and you have Apple who are also interested in streaming, but that is not where they make their money.
--:-- Peter Kafka: And they basically have an unlimited amount of money to spend on it because they make their money selling shoes or iPhones. So they can continue to spend as much as they want as long as they remain interested in this business. Amazon explicitly wants to have a giant Netflix-like streaming business. The reason they've got a Lord of the Rings show is because Jeff Bezos said, I want my own Game of Thrones show.
--:-- Peter Kafka: And they went out and spent, if you believe the reports, a billion dollars to make this thing. They're not constrained by traditional business principles. Right now, the rest of the media economy is torn between saying, we know the future is streaming. We know that the existing businesses running today are going away. But those are also the things that are making money right now.
--:-- Peter Kafka: And we have to balance those two things. We've spent the last decade talking about the golden age of television, peak TV. Prestige shows. Some of the stuff's been really good, frankly. Are we going to see more crud and less good stuff? That is an open question. So one scenario is, you know what? People like Game of Thrones, but they also like reality TV.
--:-- Peter Kafka: If you look at what people watch on cable TV and regular TV, a lot of it is actually fairly cheap programming. Doesn't cost a lot of money to make 90 Day Fiance. People like it. It's not going to win you a lot of awards. People aren't going to come to your Hampton's party and ask how you made it. But that's a good business. We're going to and we're going to do more of that.
--:-- Peter Kafka: And another version of it says, you know what? Everyone in Hollywood has been making too much stuff and it is diluted the talent pool. And instead of everyone trying to make as much stuff as possible, what if we all pulled back a little bit and concentrated the really talented people that work in Hollywood on making a few less things, but they'll be better.
--:-- Peter Kafka: I had BJ Novak on my podcast recently. This is the former star of The Office. He's got a movie out. And he was complaining about all the streaming comedies. The shows suck a lot. And if they were promising, often you take a talent that would be incredible as part of a show. And now they're not available to be on some dream team elsewhere.
--:-- Peter Kafka: And you end up with a lot of cute shows that get well-reviewed that no one actually cares about. So there is a version where you say, it's not so bad if we just slow down the machine a little bit and we make a little bit less. Consumers still have a ton of choice. You have way more choice now than you did in the old days of TV. Relax. It's going to be fine.
--:-- Peter Kafka: It's going to be fine and we'll get another office is what you've just promised me. That's what BJ Novak wants you to believe. Convergence. Viral marketing. We're going guerrilla. We're taking it to the streets while keeping an eye on the street. Wall Street.
--:-- Peter Kafka: I don't want to reinvent the wheel here. In other words, it is what it is. Buying paper just became fun.
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--:-- Noelle King: Today's show was produced by Amanda Llewellyn. It was edited by Amina El-Sadi. It was fact-checked by Laura Bullard and Tori Dominguez. And it was engineered by Paul Robert Mounsey. I'm Noelle King. It's Today Explained.
