Chapter 526： strategy

Barry Diller has not yet performed his duties, and the structural reorganization and strategic reconstruction of the New Universal Group have naturally fallen to Dunn.

Fortunately, when it comes to the strategic decision of the general direction, Tang En is quite confident.

Maybe he is not good at micro-management, but he has a vision beyond the times. He knows which strategic direction to develop, and the future of the group will be more competitive!

Future media giants, such as Netflix, Disney, and Comcast, are all role models for reference and learning!

Netflix is ​​now Dunn's company.

As for Disney and Comcast, it's best to make arrangements in advance and take away the resources that originally belonged to them!

"In the next 18 months, we will invest 300 million US dollars to expand the scale of Universal International Distribution and Universal Home Entertainment, and ensure that our film distribution channels can be spread all over the world! Not to mention the first in the industry, we must also cooperate with Disney, Warner Bros. level one!"

Although the group's senior management has not yet been formed, Dunn has been impatient to hold a meeting for the existing executives.

It is necessary to set up an accurate and clear goal and direction for New Global Group.

The global distribution channel is slightly weak, only in some mainstream developed countries, with complete establishment; some developing countries cooperate with Paramount to distribute and share risks; even worse, small countries have no distribution at all. channel, the film should be handed over to the local distribution company.

This is too lacking in the style of a large group company!

The issuing branch, on the surface, will get a higher share of the account by doing the issue by itself; the deeper meaning is the establishment of the brand image.

The brand value of Disney and Warner is so high because they have channels all over the world.

In the past ten years, Universal Pictures has changed hands several times. First, Panasonic, then Seagram, and then Vivendi. These parent companies are very irresponsible.

It takes time to build the best global brand.

The past decade has marked the beginning of economic globalization.

The sooner you eat crabs, the greater the profit!

Fortunately, it's only 2002, so it's not too late.

Tang En took over the "Universal" label, and he must make the "Universal" brand come out in an all-round way!

The first step is to build a global distribution channel.

Although, the group company has a lot of cash flow pressure after repaying $2.3 billion in debt in one go.

But the latest "Spider-Man 2" videotape, DVD release situation is very gratifying!

Within 3 days of its launch, the sales in North America successfully exceeded 200 million US dollars!

Television copyrights have also been looted by countries around the world.

The first round of broadcast in North America will definitely be in charge of the sta TV network, so this money does not need to be considered. However, for the first round of overseas sales, negotiations can be completed within half a month, and a revenue of nearly 100 million US dollars can be obtained.

And with the latest split accounts of "Spider-Man 2" and "Pirate League: The Curse of the Black Pearl" by the theater chain, New Universal Group has an additional $470 million on its books.

While Martin Scorsese's hit "The New York Times" box office... not as good as expected.

However, New Universal Group is not short of money!

"The first step is to open up global channels. The second step is to make New Global a real multinational group! Not only must there be a headquarters, but also an overseas headquarters! The customs tax, from now on , if you can avoid it! Brandy, you can grab this piece yourself, choose a suitable area, and build the overseas headquarters of New Universal!”

Tang En is no longer the Xiaobai he used to be.

Now, he does not say that he is proficient in US tax rates, but he also understands the general tax laws.

The United States implements a "dual taxation" system, also known as a "global taxation" system.

It's about national policy.

The green card of the United States reads: "No matter where you are in the world, you will be protected by the world's most powerful navy, marine corps, air force, and army."

That is to say, as long as it is an American, or an American company, anywhere in the world, it will be protected by the same laws as in the United States.

Whether it is cowhide or fact, behind this protection, there is a tax problem.

Because only when you pay, can people protect you!

Therefore, the U.S. tax agency requires that as long as the company is registered in the United States, no matter the profit obtained in the United States or abroad, it needs to pay U.S. income tax!

Such a rigid requirement, of course, is deeply disgusting for business people.

Because the money earned overseas usually has to pay a tax in the host country, if at this time, the US tax agency collects another income tax {usually calculated at 35% of the federal income tax}, it is a single income, taxed twice!

This is the so-called "double taxation" system.

It is said that the US tax is high, but it does not mean that the domestic tax is high, but this abominable "double taxation".

Even if the film and cultural industries have special care, there will be tax cuts. Funds go back to the U.S. with only about 20 percent federal tax.

But it's still hard!

According to international common practice, the proportion of the movie's credit is 35% for the producer, 17% for the distributor, and 48% for the theater.

In other words, a film, even if it is released overseas, usually gets 52% of the box office share.

However, some countries have good protection of intellectual property rights, and the share of accounts is higher, reaching 53% or even 55%, which is higher than that of the United States; some countries are relatively backward, or domestic protection, or special national conditions, the share of accounts is lower , like 33%, 30%, 25%... or even 15%.

On average, the overseas share of Hollywood films is about 45%.

However, if this 45% of the split income flows back to the United States, it will pay about 20% of income tax.

In the end, the overseas box office split ratio that Hollywood studios can get is about 45%*{1-20%}=36%.

"Spider-Man 2" grossed $1.29 billion worldwide and $730 million overseas.

If not deducted by U.S. federal tax, the overseas share will have $329 million; once it is deducted, it will only be distributed to $260 million.

The tax department ate a full $60 million!

This is not to mention, overseas DVD sales, overseas copyright sales, overseas peripheral product income, overseas vacation tourism income, etc., all have to encounter such problems.

Is there a problem to solve?

Of course there is!

Capitalists have long thought of ways to deal with it.

Since the return of funds is subject to tax deduction, the overseas branches of American companies simply do not remit this part of the income back to the parent company in the United States.

This naturally avoids the trouble of "double taxation".

Therefore, in order to avoid paying high income tax, American multinational companies generally choose to keep a considerable amount of overseas profits outside the United States.

For example, when Apple was at its peak, the cash flow was terrifying, nearly $270 billion!

However, in the case of huge cash flow, Apple still has to borrow from banks or issue bonds when it has a big move.

Why?

Because Apple has more than 260 billion US dollars of funds kept overseas in order to avoid taxes!

Apple is like this, Google is like this, and Microsoft is like this!

According to statistics, for multinational companies listed on the US stock market, the overall proportion of US companies' cash retained overseas is as high as 65%.

Hollywood film companies, including Disney, have insufficient cash flow and need overseas profits to maintain the operation of their parent companies. Coupled with the support of preferential tax policies, most of their overseas income must flow back to the mainland.

This is of course not what Dunn wants to see!

He wants to build a super company that rivals Microsoft, Google, Apple, and Facebook in their heydays!

In the future when Internet companies dominate the rankings of giant companies, Dunn's New Universal Group can have a place!

Therefore, there must be a large enough basic framework!

In the future, the business of New Universal will develop, and the income from Blizzard, Universal Studios, overseas licensing of TV programs, and overseas peripherals of movies will be a very terrifying figure.

It is impossible for Dunn to give the US government a cut in vain.

Therefore, Tang En's second step in the strategic adjustment of the New Global Group is to find a country or region with "reasonable" taxation, establish an overseas headquarters, and hoard overseas income overseas!

With this money, we can better expand overseas markets. After all, overseas markets are much larger than the domestic market in the United States.

If the money is still too much, you can wait for some special periods such as the outbreak of the Iraq War, or when the CCP takes power, to reduce the "tariff" opportunity, and then transfer overseas funds back to the United States.

Tang En looked at the more than 20 group executives in the conference room, and his pride came spontaneously. Although there are many positions for the heads of individual divisions, there are still vacancies, including major business divisions such as television media and interactive entertainment.

But seeing the CEOs of Blizzard, Pixar, Mifflin Publishing House, Netflix, Universal Pictures, Marvel Entertainment, USA TV Network and many other companies gather together and listen to his "teaching", it is still an indescribable pride!

Next, Dunn talked about the development of the TV media department, focusing on the quality content of the sta TV network and the channel breadth of the usa TV network. And promised that when the time is right, he is likely to initiate an acquisition offer to the nbc TV network!

However, the person in charge of this department has not yet taken up his post, and Tang En is still trying to find a way to dig talents from other companies, so he has not started this topic.

The same is true for the following tourism and vacation issues, but Dunn has already made instructions - vacation tourism will be the key business development in the future!

Not only that, but immediately negotiate with the Osaka city government to buy back the 50% stake in Universal Studios Osaka in their hands.

In 2001, the revenue of Universal Studios Osaka exceeded 100 million US dollars; in the first three quarters of this year, the revenue has exceeded 90 million US dollars.

The Asian market has a lot of room for development!

Especially the mainland on the other side.

It has been rumored in Hollywood that Warner Bros. is negotiating with some companies such as China Film, and will jointly establish the Hengdian Film and Television Group, and in Hengdian, it will become the world's largest film and television shooting base.

Warner has seen the potential in China.

Dunn, of course, will not miss it!

7

(Sanqi Chinese)