Evolution Media Capital making mark in sports

In less than four years, Evolution Media Capital, a boutique investment bank backed by Hollywood's biggest talent agency, Creative Artists Agency, has made a mark in the sports and entertainment landscape.

Deals in which EMC played a hand include sales of the Texas Rangers and Philadelphia 76ers as well as the new TV agreements between the Pac-12 conference and ESPN and Fox. EMC also advised on the sale of CKX, the parent company of "American Idol" producer 19 Entertainment. Overall, EMC has had a hand in more than 20 deals with a combined value of $15 billion.

For CAA, which holds a large stake in EMC and houses the firm in its Century City headquarters, the relationship is part of a strategy to expand beyond its traditional talent representation business and create new revenue streams at a time when the movie and television industries are tightening their belts.

With CAA representing lots of big-name athletes, including Derek Jeter and LeBron James, and EMC often in business with team owners, the two have to avoid any conflict of interest. Hess insists that there is a strict division between the two operations even though they share real estate.

For more on how EMC has made its mark, please see the story in Tuesday's Los Angeles Times.

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-- Joe Flint

Photo: Robert Stanley, left, and Rick Hess, co-founders of Evolution Media Capital. Credit: Jay L. Clendenin / Los Angeles Times

 

Mark Cuban, Ryan Seacrest, AEG, CAA partner on pop culture channel

 

Four of the biggest players in the entertainment industry -- Ryan Seacrest, Mark Cuban, concert giant AEG and Hollywood powerhouse talent firm Creative Artists Agency -- are teaming up to launch a new pop culture cable channel.

Called AXS (short for access), the cable network is envisioned to focus primarily on live programming aimed at entertainment aficionados. It is to include a heavy diet of concerts and lifestyle shows and use production facilities at AEG's downtown L.A. Live complex as its on-air home base.

"The industry in Los Angeles is a sport," Cuban said of the channel's plans to cover show business on a 24/7 live basis. The network's flagship show is to be called "AXS Live," which Cuban described as a "'SportsCenter' for pop culture and music."

The joint venture will be rebranding Cuban's HDNet channel, creating a new network that is expected to debut as soon as late spring. Cuban launched HDNet in 2001 and has struggled to get the network widely distributed. Currently in about 27 million homes, Cuban said he thinks having the weight of AEG behind the channel will boost its reach.

"Everybody is going to bend over backwards to work with AEG," he said.

Dish Network, the satellite broadcaster with 14 million subscribers, has already agreed to increase its carriage of AXS by almost 10 million homes, broadening its reach to about 35 million homes.

AEG and Seacrest have been mulling the creation of a cable channel together for some time. However, it is easier to acquire an existing channel than to build one from scratch. Cuban became aware of their ambitions and reached out to AEG Chief Executive Tim Leiweke about partnering with HDNet last fall, officials said.

Seacrest is not expected to have an on-air presence on the channel, but his production company has a commitment to provide content for AXS. Seacrest, who hosts a popular morning radio show as well as Fox's "American Idol," also runs Ryan Seacrest Productions, whose offerings include "Keeping Up with the Kardashians" and "Jamie Oliver's Food Revolution." 

Interestingly, AXS seems aimed at competing primarily with E!, the cable network owned by Comcast Corp. E! also focuses on entertainment and popular culture and is home to much of Seacrest's production efforts.

Cuban said it will take about six months to change HDNet to AXS. Many of HDNet's shows including its coverage of mixed martial arts and "Dan Rather Reports," which features the former CBS News anchor, will transition to the new network with more live elements, he said. However, the more adult fare HDNet carries, including "Girls Gone Wild" are to be dropped.

"Anything that was TV-MA goes away," Cuban said, referring to the television industry's rating for mature adult content.

For AEG, the alliance gives it an additional  platform to promote its live entertainment business. The concert promoter and arena owner has a library of concerts, and its arenas are also used for high-profile events that can provide content for the new channel.

Terms of the partnership were not disclosed, but Leiweke said both CAA and Seacrest are making equity investments in AXS.

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-- Joe Flint

 

Morning Fix: 'Social Network' scores. Rupert Murdoch tilts right again. Sanchez adds to CNN's woes. Quick hook in new TV season. CAA gets an infusion.

After the coffee.  Before seeing if I had the Kansas City Chiefs going undefeated this season.

The Skinny. In Monday's roundup: Sony's "The Social Network" takes the top spot at the box office, but don't look for Facebook co-founder Mark Zuckerberg to buy the DVD. CAA has landed a big investment from TPG, a private equity firm, that the talent agency hopes will position it for a bright future in an uncertain world. No new hits so far in the TV season. Legendary producer Stephen Cannell, who died late last week, not only created great TV, he stood up for independent producers against the networks.

Sony likes this! "The Social Network," Sony Pictures' attempt to tell the behind-the-scenes story of the creation of Facebook and the legal battles that followed its co-founder Mark Zuckerberg, finished first at the box office, taking in $23 million. That is just a little off from what industry analysts had projected, and the movie easily beat the other two major releases that opened -- "Case 39" and "Let Me In." The real challenge for "The Social Network" will be to avoid being the MySpace or Friendster of movies, starting out hot and then vanishing from the zeitgeist. Box-office analysis from the Los Angeles Times and Movie City News. 

Zuckerberg's thumb is down. Although the box office was good, Facebook and Zuckerberg are not fans of "The Social Network," which people close the company claim is a very distorted look at the history of the social-networking site. Hollywood take creative liberties? Shocking. David Kirkpatrick, who wrote a book on Facebook with the cooperation of Zuckerberg, talks about what he thinks the movie got wrong in the Daily Beast. After reading his article and seeing the movie, I was more surprised by how much Kirkpatrick said the movie got right versus what he said the movie got wrong. OK, so Zuckberberg didn't have sex in a bathroom as implied with the movie; I think he can survive that hit to his reputation.  In the meantime, Zuckerberg is trying to improve his own profile, making a big donation to public schools in Newark, N.J., and appearing on both Oprah Winfrey's show and Sunday's episode of "The Simpsons."

Disney's new new media duo. Walt Disney Co.'s digital aspirations are so big that it takes two executives to run its interactive unit. Over the weekend, the company announced that John Pleasants, chief executive of Playdom, a social gaming site that Disney bought earlier this year, and James Pitaro, who oversees Yahoo Inc.'s media operations, will be co-presidents of Disney Interactive. They replace Steve Wadsworth, who left a few weeks ago. Details from Bloomberg.

CAA's new look. On Friday, Creative Artists Agency announced TPG Group, a firm whose investments include Burger King and Metro-Goldwyn-Mayer, bought a 35% stake in the talent agency whose clients include Steven Spielberg, James Cameron, George Clooney and Oprah Winfrey. The deal will also see CAA and TPG create a $500-million fund for future investments. The move comes as the movie and television industries struggle to adjust to the shifting digital landscape. Analysis from the Los Angeles Times, Wall Street Journal and Deadline Hollywood.

CNN's struggles. It is a cash cow with a brand known the world over, but Time Warner Inc.'s CNN has seen its ratings plummet in the U.S. over the last decade as Fox News has raced to the top and MSNBC has made big inroads. New York magazine looks at the unsuccessful efforts of recently ousted CNN U.S. President Jon Klein to shakeup the network and turn it around, and how its competitors have managed to steal the spotlight. CNN's headaches only got worse on Friday when one of its hosts, Rick Sanchez, was canned for calling Jon Stewart of Comedy Central's "The Daily Show" a bigot and for taking some shots at CNN management as well. The Washington Post on how Sanchez imploded.

Rupert leans right. Once again, News Corp. Chairman Rupert Murdoch has made a big donation that has people talking about the influence of his media company -- whose holdings include Fox News -- on the country's political climate. Murdoch wrote a $1-million check to the U.S. Chamber of Commerce, which is working primarily on behalf of Republican candidates. The New York Times takes a look at Murdoch's spending and what it has people saying about his company.

Quick trigger. The TV season is only a couple of weeks old and already two shows -- Fox's "Lone Star" and ABC's "My Generation" -- have been canceled. So much for having patience when, with so many shows launching at the same time, it's hard to get the attention of viewers. Of course, some shows just are not good, and all the marketing in the world won't make a difference. Variety has a look at the quick hook of the networks.

Inside the Los Angeles Times: Scott Collins looks at the lack of success for most of the TV season's new shows. Legendary producer Stephen Cannell, who died on Friday, not only made a lot of great shows ("The Rockford Files," "Wise Guy"), he was a strong voice for independent producers.

-- Joe Flint

Follow me on Twitter because it will make Monday go by faster. Twitter.com/JBFlint

CAA's Bryan Lourd: Yes, we're talking with investors

A partner at Creative Artists Agency publicly acknowledged Tuesday that the entertainment and sports powerhouse has been in discussions with private equity funds.

In remarks made during the Financial Times' Business of Luxury Summit in Beverly Hills, CAA managing partner Bryan Lourd confirmed published reports that the agency is meeting with outside firms, which he declined to identify. According to the New York Times, the agency is in discussions with private equity and buyout giant Kohlberg Kravis Roberts and investment firm TPG Capital.

CAA has been aggressively expanding its sports practice, and represents such athletes as NBA All Stars Carmelo Anthony and Lebron James, New York Yankees shortstop Derek Jeter, Dallas Cowboys quarterback Tony Romo and soccer standouts David Beckham and Christiano Ronaldo.

Lourd said all this growth -- including wooing top sports agents such as Tom Condon and Ken Kremer -- has been self-financed from internal funds.

"I'm told that's unusual. I'm told there's a better way," Lourd said during the morning keynote. 

Lourd said the discussions might not lead to a transaction, but CAA is interested in bringing smart people together in a room to discuss financial options. In the event that CAA brings in outside investors, Lourd said he and other top agents, Kevin Huvane, Richard Lovett and David O'Connor, would remain with the agency.

"That's not accurate that we'd ever turn over control of our company or leave," Lourd said. "We all love it."

Athletes and sports teams represent a potential growth business for the talent agencies, which are dealing with belt tightening in Hollywood. Film studios have been greenlighting fewer films and seeking to curb the amount of money spent on salaries and promotion. The television industry, similarly, is dealing with audience fragmentation and a deterioration of the syndication market, which can hurt the long-term value of television shows for agencies.

-- Dawn C. Chmielewski

Agent Bryan Lourd, left, with James Schamus, co-president of Focus Features, in Cannes, France. Credit: Michael Buckner/Getty Images for Focus Features