Chapter 460: Chapter 460: Online Mall
Broccoli means "西兰花" (broccoli) in English. Coincidentally, the Broccoli family, who controls half of the 007 series' rights, originally made their fortune by selling vegetables.
Albert Broccoli, who discovered the 007 IP, was a strong-willed individual. To demonstrate his absolute control over the 007 series, Albert repeatedly stated in media interviews that if vegetable prices couldn't be negotiated, he would rather discard all the vegetables than sell them.
Regarding the 007 series, until Simon took control of MGM, the Broccoli family never made any concessions to MGM. The fundamental reason was that over the decades, each 007 film, as a major production, had always been profitable, never incurring any losses.
Hollywood is inherently very conservative. When Westerns were popular, everyone rushed to shoot Westerns. When buddy films emerged, a slew of buddy films appeared. When teen horror movies were a hit, the market was flooded with teen horror films. This conservatism stems from the significant risks in the film industry. Any production company deciding on a project worth millions of dollars is far from as carefree as outsiders imagine. Hence, following already successful film models becomes the best choice for most production companies. Essentially, it's trend-following.
Just like the movies from across the ocean, Hollywood's trend-following is relatively benign, supported by the solid North American market, allowing it to continue and remain strong. Due to its conservative nature, the 007 series, which never incurred losses, became MGM's most valued "broccoli."
However, Simon, who never lacked fresh vegetables, didn't mind if the seller dumped their vegetables when a price couldn't be agreed upon. When Sherry Lansing approached the Broccoli family under Simon's terms, the Broccoli family, accustomed to being strong-willed, naturally wouldn't compromise. Simon, not one to waste time, directly instructed Sherry Lansing to announce the indefinite suspension of the 007 series.
After MGM's announcement, the Broccoli family's reaction aside, the other MGM shareholders, who could potentially counterbalance Simon, showed little response after some concern. Last year, MGM's two blockbuster films were "A Few Good Men" and "007: GoldenEye." "A Few Good Men" grossed $117 million in North America, with global earnings expected to reach $200 million. In contrast, "007: GoldenEye" was projected to earn just over $80 million in North America, with a global forecast still at $200 million. Even with stars like Tom Hanks, Robert De Niro, and Demi Moore, the overall production and distribution budget for "A Few Good Men" was still less than half of "007: GoldenEye."
Despite being a collaborative project between Daenerys Entertainment and MGM, the cost advantage meant that "A Few Good Men" brought far more profit to MGM than "007: GoldenEye." After all, MGM shouldered the production and promotional budget for the 007 series, while the Broccoli family only managed the production. However, the Broccoli family took a significant portion of the film's profits due to their control over half the rights and involvement in production.
In the past, a turbulent MGM could rely on the 007 series as a stable project to support its performance. Now, under Simon's control and moving towards recovery, the series wasn't deemed essential. Following "A Few Good Men," the second project by Daenerys Entertainment and MGM, "A Time to Kill," had already started last year and was scheduled for this summer. With MGM's revival in mind, more collaborations were expected. Comparing the returns of "A Few Good Men" and "007: GoldenEye" and observing MGM's notable changes over the past year, it was clear where the shareholders would stand after Simon's decision.
When MGM announced the 007 suspension, Simon was in San Francisco, not Los Angeles. On Thursday, January 23rd, the long-prepared Amazon online mall officially launched on the Eaglet portal. This was the first sub-brand launched by Eaglet, with previous business units named after Eaglet. By the end of 1991, the number of World Wide Web users in the USA reached 13.17 million, with 7.68 million on America Online.
With 13.17 million web accounts, averaging 1.6 active users per account, the number of American internet users reached 21.07 million, equating to 10% of the US population at the time. These users represented the most educated and financially capable 10%. Over 20 million netizens, the most powerful consumer group in the US, could no longer ignore the internet's rise.
Since the latter half of last year, funds and companies had been pouring into the internet industry, and even the federal government was paying significant attention to its development, indicating explosive growth. The surge in the internet industry benefited the personal computer sector greatly. Despite a predicted stagnation in global PC shipments due to economic downturns, 1991 saw 23.87 million units shipped, a 19% increase, driven by users seeking better internet experiences.
The rise of the internet was unstoppable. Although the new Amazon launched three years earlier than its original timeline, with the backing of the Eaglet portal, it had over 20 million potential users upon launch. Furthermore, Eaglet's increasingly mature online payment tool, Ypay, provided a sophisticated payment solution for the Amazon online mall.
In Simon's plan, Amazon would focus on book sales for the next three years. Choosing online book sales as the start of physical e-commerce had numerous advantages. The well-educated internet users had a high demand for books. Compared to physical bookstores, the online mall could offer a vastly greater variety of books, ensuring users' willingness to try online book shopping. Simplifying the types of physical goods sold could also reduce the complexity of e-commerce operations. At the same time, the Amazon online mall would help the Eaglet team gain experience in running e-commerce websites, warehousing, and logistics.
Although no special launch event was held, Eaglet had already begun advertising on networks, TV, radio, and newspapers before the online mall's opening. Simon arrived in San Francisco on the morning of January 23rd. At 9 AM, the Amazon online mall officially opened. Despite initially limiting delivery areas to the East and West Coast metropolitan regions, excluding the northern Great Lakes and vast central and southern areas, the mall saw over 100,000 orders within just 31 minutes of opening, thanks to heavy promotional activities. By 5 PM, eight hours after opening, the total number of orders reached 870,000.
It's widely known that evening is the peak time for online shopping. After work, Simon flew back to Los Angeles. By 9 AM the next day, after 24 hours, the Amazon online mall had processed 1.32 million orders, selling 1.56 million books and achieving sales of $32.76 million. This seemingly simple set of data was no less than a miracle for many. No physical bookstore in the world could match selling over 100,000 books in a single day, let alone over a million.
Thus, the Amazon online mall's emergence, like Eaglet's Ypay and Ystore launched last year, demonstrated the feasibility of internet-based e-commerce almost overnight. Following the announcement of Amazon's first-day sales, traditional physical bookstores and retail giants like Walmart quickly turned their attention to the internet, holding emergency meetings to discuss the necessity of launching online stores.
Despite the traditional media's nitpicking attitude towards the internet, they still began to proclaim the arrival of the e-commerce era following Amazon's first-day sales data. For Eaglet, the seemingly impressive numbers from the Amazon online mall's first day also meant numerous challenges. Eaglet had spent $20 million on advertising in just the past half month to ensure the online mall's immediate popularity. The overwhelming first day proved the advertisement was excessive.
Achieving 1.32 million orders on the first day meant significant server load. Although the Eaglet portal could handle such user visits thanks to continuous data center expansions, the Amazon online mall's pre-set access limit was 5 million. Without emergency plans, the online mall could have crashed on the first day. Eaglet's cloud computing project had entered substantive testing but needed at least another year for large-scale application. The fixed-volume data processing and storage mode of traditional methods would cause significant cost pressure.
Still, as long as the online mall had a good start, these efforts would be worth it. The main challenge was the logistics pressure behind these orders. The mall team's best prediction was a million orders on the first day, but reality surpassed it by 30%. Fulfilling these 1.32 million orders, even with America's advanced postal system, was a colossal challenge for Amazon's still-experimental warehousing and logistics system.
Therefore, the mall team's first decision after the first day was to pull as many ads as possible from various platforms. They couldn't afford more publicity. Simultaneously, the team began contacting other courier companies besides USPS, almost planning to complete the first large batch of orders at any cost. Everyone understood the importance of the first impression. If users waited half a month for their books, it would severely dampen their enthusiasm for future online shopping.
To help the mall team overcome difficulties, Simon sent Nancy Brill over. With her extensive warehousing and logistics experience at Blockbuster, she could significantly aid the mall team. Nancy unhesitatingly requested a special consultant title at Eaglet, with a salary, of course. For logistics, Alice Ferguson, in charge of mall operations, had to explore handling the unprecedented single-day order of 1.32 million, with Eaglet's high-level team brainstorming solutions.
Simon bluntly stated that if they failed, they'd have to return and be his housekeeper. The Westeros system's early internet industry layout was at a critical stage, with e-commerce
being the priority in Simon's plans, leaving little patience for failure.
In the busy days, another weekend quickly approached. The 8th Sundance Film Festival had opened on January 16th. Following "Run Lola Run," Sundance had thrived, and Hollywood independent films flourished under the success of Gaia Films. Before this year's Sundance, Robert Redford hoped Simon, Sundance's most prominent figure, would attend. While Redford didn't suggest Simon be a judge, knowing Simon's unavailability and Sundance's incapability to afford him, this year's jury chair was Katherine.
Busy during the opening, Simon planned to attend the closing ceremony on January 26th, Sunday. Arriving in Park City, Utah, on Saturday, Janet stayed with the kids, and the assistant in charge of building cabins for Simon's visits stayed behind. January still brought spring-like weather to Los Angeles, while Park City was a winter wonderland, an ideal secluded setting for a romantic getaway.
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