New Medient Studios chief executive officer Jake Shapiro said the company will get to the essence of its being — that of making movies.
Shapiro, who was named CEO last Wednesday after company co-founder Manu Kumaran was dumped as CEO and chairman of the board, said production of “The Damned” will be announced later this summer. During a conference call with investors and also in interviews with news media later Thursday, Shapiro said pre-production has begun on the movie.
“Medient Studios is a film production company,” he said. “Medient Studios was created to make movies. So make movies is what we are going to do.”
The horror movie not only is set in Savannah, it also will be Medient’s first project shot in the Coastal Empire. The studio is building the largest movie production facility in the U.S. on more than 1,500 acres off Interstate 16 and Old River Road in Effingham County.
Shapiro said the company is finalizing the director, cast and crew for the movie.
“We hope to announce the start of filming later this summer,” he said. “One of the reasons we chose ‘The Damned’ is not just because it is set in Savannah, (but) Savannah happens to be the most haunted city in America.”
Entertainment veteran Charles Koppelman was named chairman of the board after the rest of the board voted to unseat Kumaran from his positions. Shapiro said the company will hold a shareholders’ meeting, which will be open to the public, within the next 90 days.
“This is one of the first steps in increasing the visibility and transparency of Medient,” he added. “We will do everything to increase transparency to our shareholders, to our directors and to our stakeholders.”
The new leadership, according to Shapiro, also has slashed away at what it saw as tremendous corporate overhead.
“There have been significant changes,” he said. “A Medient Studios in and of itself does not require a tremendous amount of employees or management. The production companies are what drives all the growth. We are creating a structure now where we have leaned down the corporate overhead to a strong, lean, tough team that can now build and create the individual movies for productions.”
At the core of the changes among Medient’s leadership was the continued fall of its stock prices and the continued stock dilution, Shapiro acknowledged.
“It’s one of the reasons that forced the board to take its actions,” he said. “Every single decision this company makes has to come down to that bottom line question — does it create shareholder value? It is all about running a tight, efficient ship to maximize the value and growth of this company.”
Shapiro also re-affirmed the company’s commitment to the studioplex in Effingham County. The new management team will adhere to the plan Kumaran laid out of shooting movies at a lower cost.
“One of the biggest issues in Hollywood and the biggest reason films lose money is because of cost,” he said. “That’s the biggest problem in the industry. So our model of using our own full-time crews, using all of our own equipment and reducing the cost of up to 75 percent, combined with the tax credits from the state of Georgia, generates anywhere from 30 to 70 percent margins. On that basis, just on foreign sales of those films, we should be able to generate enough revenue and production finance that every dollar we make domestically is actually pre-tax profit.”
Medient also pointed out that more and more films are being made on the East Coast, where labor costs are lower and tax credits are more available. In 2013, more than $3.3 billion was spent by television and movie makers in Georgia, according to the state Department of Economic Development’s film and TV branch.
“In my opinion, Georgia will be the new Hollywood,” Shapiro said. “The Medient vision is elegant in its simplicity. The concept of building and producing an intellectual property factory that utilizes its own equipment, its own full-time labor, creating jobs is fantastic and one this entire team supports whole-heartedly. We all know Hollywood is broken, but it wasn’t always this way.”
The changes aren’t limited to the management structure and leadership of the studios. While Shapiro said they will build the U.S.’ largest intellectual property factory in Effingham County, much of the entire plan has been shelved.
“Gone,” he said, “are the architectural wonders of the world. No suspension bridges built out of glass. Gone. No leaf concert buildings built out of fairy dust and engineering that doesn’t exist yet, that require hundreds of millions of dollars with no economic return in sight.
“Soundstages are the economic engines of this business,” Shapiro said. “A soundstage only needs to be a large rectangular box.”
The original plan called for the movie/DVD/video game production facilities to be in the first phase, to be followed by housing for the employees in a live-work environment. The other buildings, such as the Leaf, the giant glass structure to be used as an amphitheater, and the hotels and retail shops were slated for later phases.
“We will be building production offices,” Shapiro said. “We will be building post-production offices. We will be building this studioplex a stage at a time, a building at a time, a movie at time. The dream of building the soundstages is becoming a reality.”
Shapiro also said once production is wrapped on “The Damned,” the studio will go into its next production with its own crews and own equipment.
“We are going to put into action what has been dreamed and visioned up until now,” he said.
Said Koppelman: “I always believe that content is king. And if you combine great content with a world-class facility I think you’ve got the recipe for great success.”
A timeline of events over the last two years for Medient Studios, Inc., which was founded in 2002.
• September 2012 – Fairway Properties, Inc., changes its name to Medient Studios, Inc., and Manu Kumaran is named CEO.
• March 2013 – Medient executes a memorandum of understanding with the Effingham Industrial Development Authority for a $90 million production facility on 1,550 acres.
• August 2013 – Medient executes a 20-year lease for the property. The IDA also agrees to provide $1.25 million in site development.
• August 2013 – Medient holds groundbreaking for its project, which is to be the largest movie-making facility in the U.S.
• December 2013 – Former CEO and chairman of Martha Stewart Living and CEO and chairman of EMI Records Charles Koppelman joins the Medient board of directors.
• January 2014 – Medient completes acquisition of distributor Atlas International
• March 2014 – Charleston, S.C.-based Shore Development and Construction named construction contractor for Medient studioplex
• May 2014 – David Paterson, former governor of New York, joins Medient’s board of directors
• June 2014 – Board members vote to oust Kumaran as chairman and CEO. Jake Shapiro is named CEO, and Koppelman is named chairman of the board.