Sean Carey may be in the vanguard of the television industry’s exploration of the digital space.
But he is the first to admit that he has no idea how the industry plans to monetize programming and distribution on new media. “Anyone who says it is a science is lying to you,” he says. “There is definitely guesswork right now.” In Carey’s case, that guesswork is supported by a keen understanding of the entertainment business.
With more than 15 years at Sony Pictures Entertainment (SPE), Carey has projected finances for films and played a key role in such deals as the acquisition of MGM. Now, as senior executive VP for Sony Pictures Television (SPT), he’s leading the studio’s charge into the digital age.
FROM BOX SCORES TO BALANCE SHEETS
A lifelong sports fan, Carey originally wanted to be a sportscaster. But by the time he left Syracuse University, he realized that financials, not box scores, were the numbers he wanted to build a career from. So he moved to Los Angeles to jump head-first into the high-flying, Hollywood lifestyle. The rewards, of course, were not immediate.
“I lived at a fraternity at UCLA in a one-bedroom with three guys,” he recalls. “I was trying to get a job, and everyone else was trying to have fun.”
Carey began his career at Creative Artists Agency (CAA) in corporate consulting. There, he learned the business side of entertainment, working with such clients as Japanese electronics giant Matsushita, which CAA was advising on its eventual $1.6 billion acquisition of MCA.
But Carey soon turned his attention to business school. He picked up two jobs on the side—waiting tables at Johnny Rockets and bartending at catered events —and began saving up for tuition.
After a year and a half at CAA, Carey jumped to the accounting department at SPE’s Columbia Pictures, where he had access to every contract the studio had ever executed. He also made enough money to enroll in business school a year later at UCLA.
After earning his MBA in 1993, Carey returned to Columbia. As a motion-picture planner and analyst, he crunched numbers to predict profit levels and determined whether or not the studio should greenlight such films as Francis Ford Coppola’s Dracula.
In 1996, Carey became VP of corporate development at Sony Pictures, where he focused mainly on bringing third-party financing to movies, such as deals with insurance companies to hedge against films’ flopping.
EXPLORING DIGITAL DISTRIBUTION
Although Sony Pictures was prominent in film and television production, it had no distribution channels, chiefly due to its foreign-ownership restrictions. But with the explosion of the Internet at the end of the millennium, the Web became a major focus of corporate development.
Carey and Sony began talking with major players like Yahoo! and AOL about strategic alliances, as well as investment and acquisition possibilities, although none came to fruition.
But Sony stayed focused on digital distribution and production, creating an entire division to handle it. And by 2000, Carey was running corporate development for the whole company, working with both the television and film divisions.
In addition to playing a pivotal part in the 2004 MGM transaction, in which Sony and Comcast led a consortium to acquire the legendary studio, Carey worked on the 2001 sale of Telemundo to NBC and the joint-ownership deal with Liberty Media for GSN.
FISHING IN THE DIGITAL STREAM
But after several similar transactions, he became restless for change and jumped at an opportunity to join SPT President Steve Mosko to develop the company’s digital strategy and position the studio as a more forward-thinking business.
Says Mosko, “Sean is a terrific team player who worked his way through corporate development and will be an integral part of not only our digital growth, but the growth of the entire television business in the near future.”
Like the rest of the industry, Carey and SPT are trying to figure out how to maximize revenues in the digital world. To that end, Carey is focused on building Grouper, the online video aggregator that SPE acquired last August for $65 million, into a profitable video platform. And SPT is looking at the possibility of launching broadband channels this summer.
“The beauty and the curse of the digital space is that there are no barriers to distribution,” Carey says. But the challenge, he adds, is getting content or a new broadband channel to stand out in that great expanse.
And he believes that allowing television networks to stream the studio’s content online (after broadcasting it over the air) helps lead the audience to it.
“We’d rather have a show get picked up for another season,” he says, “and if allowing a network to stream it in a limited fashion helps in that regard, then we should be accepting of that, even though we acknowledge that it will have an impact in syndication.”
That’s where the guesswork comes into play—along with the financial expertise on which Mosko and Sony have come to rely.
“I am a strong believer [that streaming shows] is incremental,” Carey says, before pausing to let the figures run one more time in his head. “Or at least not 100% cannibalistic.”