Michael, Baby, Have We Got a Deal for You . . .

To: Michael Ovitz

Creative Artists Agency

Ex: Mickey the Agent

Re: New Media

Hey, sorry about taking so long to get back to you, but you know how life is at the top: deals, deals, deals and demanding clients that deserve only the best.

Speaking of which, you know I’m only too happy to give you my thoughts on how CAA should be repositioning itself to take advantage of new media technologies. That’s what friends are for. I gotta tell you, while things may be tight here in Hollywood, I can’t help but see tasty little targets of opportunity just waiting for you and CAA to gobble up.

Play your new media cards right and you’ll be defining the future for Eisner, Murdoch and Levin--not to mention the real world. If not, some feisty young associate will be running the next CAA.

But frankly, Mike, I’m confused. Maybe it’s that you play your cards too close to the vest or that you haven’t decided what game you’re going to play. I thought you were trained to be a master of aikido--not karate. However, instead of going with the flow and momentum of these new media opportunities, it seems like CAA wants to impose its style on this nascent market.

Remember, CAA got burned trying to turn Archer Communication’s clever QSound technology into an audio industry standard. While you successfully helped broker the Matsushita/MCA deal, all those tantalizing promises of “multimedia synergy” seem unlikely to materialize anytime soon. While your people are certainly talking with everybody who matters, it’s hardly clear what you’d like your vision of new media to be--except that you and your clients will be at its center.

Do you think the basic problem might be that CAA is more comfortable being a yenta than a midwife? It’s not enough to get media companies married, you’ve got to help them deliver their innovations. That’s the way you can create the pop culture infrastructure for the next century.

Of course, that doesn’t mean you have to hire a bunch of folks from Caltech and Stanford to analyze technologies for you; what it means is that you and your people have got to start thinking more about the intersections between technology and pop culture. The future of CAA should be representing the digital Disneys of tomorrow.

Let’s start with the obvious. Increasingly, movies and television rely on brilliant software designers creating fascinating special effects. As you know, the future will see computer-generated imagery for sets, scenery, fantastical creatures and--yes--the digital manipulation of actors and actresses. Don’t you think that CAA should think about representing the kind of computer talent you find at Lucasfilm’s Industrial Light & Magic and Caltech’s Jet Propulsion Lab? Don’t you think that representing these “digital scriptwriters” could give CAA truly valuable insights into the future directions of technological opportunity both in Hollywood and beyond?

That’s aikido, not karate.

You’re already in the analog intellectual property business with books, scripts and video. Why not handle digital properties as well? Don’t you think you could significantly expand the marketplace for software designers from Sony, Matsushita, Apple and Microsoft? (I’ll concede that, with more than 700 clients, representing a new phalanx of programmers might be a stretch.)

The same philosophy applies for the home entertainment market. You know the numbers: Home video is essentially flat; so, at $4.9 billion, is theatrical release. But Mike, home video games--as represented by Nintendo, Sega, et al--is now a $5-billion-a-year business. The video arcade business now tops $6 billion a year. Please tell me, how many video game designers does CAA represent? Nintendo is more profitable than any studio in Hollywood. When are you going to package deals for them? CAA is supremely well positioned to be a medium to integrate home video with home video games; interactive television with cable TV systems; the regional Bell operating companies with computer game networks. But innovation doesn’t spontaneously erupt once the deal is packaged.

You know I think you and CAA are loaded with vision. I just think it would be a good idea if you took the opportunity to articulate the role new media was going to play in it. Gotta hop . . . I’ve got Geffen on the other line and he swears he’s going to buy something. . . .