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JJ Abrams Turned Down Apple Deal Valued at More Than $500 Million, Signed With WarnerMedia for Less Due to Flexibility

September 14, 2019 | Posted by Jeffrey Harris
JJ Abrams

Earlier this week, WarnerMedia and Bad Robot announced a wide-ranging content collaboration agreement. Under the new agreement, Abrams and Bad Robot will create new projects for TV, film, video games, and digital platforms for WarnerMedia. The deal is slated to run until 2024. According to The Hollywood Reporter, filmmaker JJ Abrams along with his wife and producing partner at Bad Robot, Katie McGrath, turned down a content deal with Apple that was said to be worth more than $500 million. Instead, Bad Robot signed the aforementioned five-year deal with WarnerMedia that’s worth less at about $250 million and possibly more with financial incentives.

Under the deal, Bad Robot and JJ Abrams will develop new film, TV, video game and digital projects for WarnerMedia’s divisions, including Warner Bros., HBO, and the HBO Max streaming service. WB TV has been the TV home for Bad Robot since 2006, and now it makes the studio the film home for the company as well.

Per the report, Apple’s deal ranged at $500 million would’ve seen Bad Robot set up shop exclusively at the company. It appears the main reason why Abrams and McGrath rejected the deal was to have the flexibility to sell products to other outlets and companies. Apple wanted Bad Robot to only create new content and projects for Apple. For example, under this deal, Abrams wouldn’t be allowed to work on outside projects for companies such as Walt Disney Studios, where he works on the Star Wars franchise, or with Paramount Pictures for Star Trek. Abrams and McGrath wanted to be able to continue selling products and content to other third-party outlets, and they have a vision to turn Bad Robot into a consumer brand.

Another reason why Abrams and Bad Robot walked away from the Apple deal was the lack of a theatrical distribution model. Bad Robot makes a sizable income from the blockbuster features Abrams has directed. Additionally, there’s a lack of IP at Apple that Abrams could adapt for feature blockbuster and TV material.

Sources for THR also indicate that WarnerMedia CEO John Stankey influenced former Warner Bros. CEO Kevin Tsujihara stepping down from his post. Katie McGrath is a founding member of Time’s Up and reportedly conveyed to Stankey that Tsujihara’s presence as CEO was a “values” problem while she and Abrams were looking into options for Bad Robot. For Stankey, it wash reportedly his “personal mission” to lock in a deal with Bad Robot. Tsujihara was under fire after texts emerged revealing he had an affair with actress Charlotte Kirk in exchange for trying to help her land roles with Warner shows and films. Tsujihara later stepped down in March, which helped repair the values issue McGrath had cited for the company.

Additionally, the Bad Robot deal with WarnerMedia is believed to give Warner a “partial equity stake” in the production company. It’s currently an industry secret if that is true and if Abrams will still be allowed to work on other feature projects beyond his pre-existing deals. Sources say that it will be more about the “larger opportunities” that are available.

While the deal is initially valued at about $250 million, it could become even higher if Abrams creates successful new franchises for the media giant. JJ Abrams stated the following in the official press release on the announcement.

“It is a thrill for Katie, Brian (Weinstein) and me and the rest of our team at Bad Robot to call WarnerMedia our company’s new home. John Stankey has a powerful vision for the future of WarnerMedia and is committed to storytelling that connects people around the world. We are excited and gratified to be a part of this new chapter under his and Ann Sarnoff’s thoughtful leadership. I could go on for hours, and probably will, about the extraordinary Peter Roth and the entire Warner’s television group, with whom we’ve worked for over a decade, and I’ve wanted to collaborate with Toby Emmerich and his team for as long as I can remember. I am grateful for the chance to write, produce and direct work for this incredible company, and to help create films and series with a diverse and vast collection of inspiring storytellers. We can’t wait to get started.”