Jamal Khashoggi: Hollywood & Int’l Film Firms Await Clarity But Are Now Reevaluating Saudi Arabia Investments
Leading U.S. and international film companies have been largely quiet so far on the disappearance of Washington Post columnist Jamal Khashoggi. Behind the scenes, however, they are reevaluating their investments in and from the country.
International outrage over the fate of Khashoggi, who has been missing since entering the Saudi consulate in Istanbul on October 2, has been growing as sources within the Turkish police say they have evidence of his murder. The incident threatens to derail Crown Prince Mohammed bin Salman’s efforts to reform the kingdom’s economy and international image. The Riyadh stock market had its biggest fall in years on Sunday.
Saudi Arabian officials vehemently deny Turkey’s claim that 15 Saudi men abducted and murdered the U.S.-based journalist, who is one of the most respected commentators on the Arab world. Donald Trump initially threatened “severe punishment” if the critic of the Saudi regime has been killed but has since suggested the disappearance could have been enacted by “rogue killers”, which seems to indicate a desire to smooth over the crisis.
Prominent business leaders have distanced themselves from the regime. Virgin Group founder Richard Branson has suspended a $1B investment project while JP Morgan, Uber and Ford are among those to cancel their sponsorship of a high-profile investment conference in Riyadh next week. Media outlets Bloomberg, CNBC, the New York Times, CNN and The Financial Times have also pulled out. Actor Gerard Butler has canceled a trip to the country for a screening of his movie Hunter Killer.
This is quite a reversal from the mood earlier this year when Mohammed bin Salman, or MBS as he is known, launched a coast to coast U.S. charm offensive. Entertainment and business leaders said to have met him included Bill Gates, Rupert Murdoch, Elon Musk, Peter Thiel, Tim Cook of Apple and Disney’s Bob Iger. Disney and Fox have had sizeable Saudi investment in recent years while Amazon and Apple are among tech giants reportedly looking to expand their Saudi footprints. AR outfit Magic Leap has raised hundreds of millions of dollars out of the country. Ari Emanuel and producer Brian Grazer reportedly threw a dinner for the Crown Prince who is buying a $400M stake in Endeavor. That was the plan, at least.
Endeavor is one of a handful of film and media companies now reassessing its ties to the country following Khashoggi’s disappearance. Sources close to the company told me “the firm is monitoring the situation closely and is considering its next steps”. Those steps include backing away from the $400M investment deal. I hear this is a likely eventuality. Today, Ari Emmanuel told Mipcom delegates that he is “personally really concerned” about the situation, adding he couldn’t say more for “legal reasons.”
WWE is another entertainment brand starting to distance itself from the Kingdom. As reported by Forbes, the company has started to dilute online mentions of the country in editorial for its multimillion-dollar Crown Jewel wrestling event in Riyadh.
Governments and major firms the world over do business with the oil rich nation. The lure of political influence, financial investment or of being part of cultural change has often trumped qualms over the country’s social justice and human rights record. A more open and tolerant Saudi Arabia has been welcomed by the film industry, especially at a time when the Chinese government is cooling its Hollywood courtship. Huge investment in the country’s entertainment sector, including the reopening of the country’s movie theaters has proved a tantalizing proposition. For the exhibition community in particular.
Cinema chains AMC, IMAX, Vue International, iPic, Vox (a MENA brand which is already up and running in Saudi Arabia) and Kuwait National Cinema Company are among those to have announced licensing plans in the country. Earlier this year, AMC hosted a historic Black Panther premiere in Riyadh, one of the country’s first public film screenings in decades. None of those exhibitors were available for comment when we reached out but company sources at multiple of them have confirmed that their plans are now on hold until they have more clarity on the Khashoggi situation.
Sources close to leading international cinema chain Vue tell me Tim Richards, the firm’s founder and CEO, has cancelled his appearance this week at a board meeting for Qiddiya Investment Company, the entertainment park which is a cornerstone of MBS’s development program Vision 2030. I understand Vue is now considering whether to move forward with plans to launch tens of multiplexes in the country. Should evidence emerge that Khashoggi was murdered by Saudi Arabia’s monarchy, the firm will ditch those plans, a source said.
For those in the Middle East, this situation has dangerous implications. One local industry source told me, “There is a lot of caution and fear about speaking out on this subject but there has been growing uncertainty about how viable the Saudi entertainment project is. This latest incident could push it one of two ways: the West could back out of investment plans or MBS could pull the plug on the whole entertainment project as retaliation for Western accusations or sanctions. Everything is being questioned right now.”
Another in the region said international spats and local administrative complexities had pumped the breaks on Saudi market entry from the West even before the Khashoggi affair.
One leading film company executive who has been working closely with the country expressed a sentiment I’ve heard quite a bit in the last week, “I’m extremely sad and disappointed by this situation,” they said. “We thought the country was turning over a new leaf and heading in a different direction. MBS was inspirational. People now feel betrayed.” The Saudi Film Council was unavailable for comment.
While Saudi expats I have spoken to have maintained for some time that MBS is a wolf in sheeps clothing, the winds of change he engineered earlier this year convinced many. Cultural and social evolution, such as allowing women to drive, enticed Wadjda and Mary Shelley director Haifaa Al-Mansour, historian Mona Khazindar and playwright and theater director Maysa Al-Sobehy to join the country’s new Culture Board.
Given its financial reach there is barely a corner of the world untouched by Saudi influence. The U.S. brokered a $110B arms deal earlier this year. In addition to the pending Endeavor deal, the Saudi Public Investment Fund took a minority stake in Deadline and Variety owner PMC earlier this year.
The Saudi relationship has long been a conflicted one. The rise of apparently progressive and modern MBS may have temporarily blurred lines but for the film industry, Jamal Khashoggi’s disappearance is now putting that conflict into sharp relief.