Hollywood’s Oxygen

They are some of the most well-paid people in Hollywood. They’re welcome at the most exclusive parties and are constantly brushing elbows with the town’s biggest names. Leaving aside the numerous jokes to be made about Hollywood’s oxygen, I am referring to the agents that manage the town’s top talent. These agents provide a continuous stream of deals “in a town that needs deals like oxygen,” as the Financial Times characterized agents’ place in their story on the industry.

Mainly known for fetching their clients top-dollar contracts, agencies are being forced to expand their repertoire. In the past, garnering promising and proven talent may have been enough. Today, though, agents are finding themselves forced to find new ways to offer value, and they’re forced to do so in a changing environment. Studios are making less movies (last year saw a 20% drop), and becoming less willing to take risks on an incomplete picture. Agents are adding value by “packaging” movies – a term referring to attaching a director, star, and script.

Citing fewer movie productions and sharply declining DVD sales, Jeremy Zimmer, partner at the talent agency UTA, states, “Real agents aren’t bookers any more, they are job creators…we have to be creative.” Agencies are looking to other areas for additional revenue sources. Television has become increasingly important with agencies fighting to package pilot shows for big profits.

Others are looking not to create new content, but rather to bring existing content to a new audience. For example, Creative Artists Agency, the largest talent agency, which manages infamous curmudgeon Simon Cowell, worked on contracts to bring his hit UK show, The X Factor to the US.

Further still, agencies are vamping up their efforts on branding their clients. One agency helped singer Gwen Stefani create a clothing line, while CAA snagged a marketing deal with the New York Yankees’ new stadium. In contrast to the growing concern over the use of sports endorsers, CAA has made a strategic decision to pursue some of the world’s top sports talent. The bottom line is a valuable lesson for any industry: when opportunities seem scarce, adapt by creating your own.

And as for who really came out on top at the Oscars? CAA lead the pack with 9 awards (out of a dominant 28 nominations)

For more info on agencies’ Oscar nominations and awards, go here: OSCARS! Which agencies were the big winners?
Read last month’s Financial Times story on the agency industry here: Hollywood’s golden talent agents

Terry Hayes