In a bold bet on the digital future of entertainment, Time Warner Inc. has selected its digital guru -- Kevin Tsujihara -- as the new chief executive of Warner Bros. Entertainment.
Time Warner Chief Executive Jeff Bewkes' selection of Tsujihara, currently president of Warner Bros. Home Entertainment, was something of a surprise. Bewkes on Monday passed over two seasoned executives who have been responsible for the Burbank studio's marquee businesses: Bruce Rosenblum, who is in charge of television production, and Jeff Robinov, who is head of Warner Bros.’ prestigious movie studio.
But Tsujihara's humble and low-key personality turned out to be key during a protracted two-and-a-half-year corporate run-off between the three executives. Bewkes was impressed not only by Tsujihara's management style but how he handled himself in the tumultuous process, according to company insiders.
It is unclear whether Rosenblum, who is chairman of the Academy of Television Arts and Sciences, will remain at Warner Bros. beyond August.
Career uncertainty also surrounds Robinov, a former talent agent who has spent years nurturing relationships with top Hollywood directors, including Chris Nolan (“The Dark Knight”), Ben Affleck (“Argo”) and Todd Phillips “(The Hangover”). However, Robinov has had a better working relationship with Tsujihara than with Rosenblum. Robinov has several years remaining on his employment contract.
The selection was made by Bewkes and Barry Meyer, chairman of Warner Bros. Entertainment, whom Tsujihara will replace when Meyer retires at the end of this year. Meyer has spent 14 years running Hollywood's largest movie and television studio, which is responsible for such juggernauts as the "Dark Knight" and "Harry Potter" film franchises, critical winners like the Oscar favorite "Argo," and profitable television shows like "The Big Bang Theory" and "Two and a Half Men."
The fact that Tsujihara has been running digital distribution, home entertainment, video games and leading the studio's anti-piracy efforts strengthened his candidacy. Hollywood has been rocked by a digital revolution that has upset the economic models that have long underpinned the industry. Tsujihara has been a strong proponent of UltraViolet technology and he championed the studio's acquisition of Flixster as well as making the studio's content available on a variety of platforms, including iTunes and Xbox.
Tsujihara, however, does not have deep experience in movies or television. In fact, he founded an online income tax filing business before joining Warner Bros. in 1994. He has spent most of his tenure overseeing the studio’s digital distribution, video games and DVD sales, which have plummeted along with those of other studios’ in an industry-wide slide.
The promotion of Tsujihara comes after a long, tense bake-off between Tsujihara, Rosenblum and Robinov. In September 2010, Bewkes established an Office of the President, made up of the three senior executives, to foster team work and allow the three executives to become more familiar with each other’s divisions. The plan quickly unraveled, creating tensions, disharmony and gossiping among middle managers.
However, Bewkes felt that the process was successful because he ultimately was able to identify the most resilient executive who could navigate choppy waters -- a necessity in the current environment, according to an insider familiar with Bewkes' thinking.
The selection of the affable Tsujihara also speaks to Bewkes’ apparent desire to maintain Warner Bros.’ genteel business culture. Warner Bros. has long been Hollywood’s premiere studio, and the professorial and buttoned-up Meyer has become something of a dean of Hollywood studio bosses in an era of corporate ownership.
The historic Burbank company, founded in 1923 by brothers Jack, Harry, Sam and Albert Warner has had only a handful of management changes in its 90 years. The studio is regularly No. 1 or No. 2 in the box office ranking, has the top market share in home video and sells more TV shows to networks than any other studio. Revenue in 2011 climbed 9% to $12.6 billion.
A year ago, Rosenblum was widely expected to get the nod. Warner Bros. has a long tradition of advancing its television executives, including Meyer and former chairman Bob Daly. Rosenblum, 54, was Meyer’s longtime deputy and the television business is the most profitable part of Warner Bros. He is expected to stay on through the transition, although his current contract ends in August.
But last summer, ranking movie studio executives began a behind-the-scenes campaign to thwart Rosenblum’s chances at the top job. Some of Bewkes’ advisors also viewed Rosenblum as campaigning too hard for the job, which Bewkes had strongly discouraged.
It is expected that Tsujihara will sign a five-year contract.