Chapter 201: 201: TIMES Have Changed

The weather in Las Vegas was cool and pleasant in March, and the open-air garden inside Caesar’s Palace Hotel was bustling with guests either dining with drinks or lying in the sun, as waiters moved to and fro with trays. Around noon, the filming of “MIT-21-TEAM” also halted, and it was time for a lunch break.

At a table shaded by a sun umbrella, Natalie, wearing large sunglasses, was seriously reading her script, occasionally discussing with Rachel who sat across from her. They were talking about the scene they would shoot in the afternoon and had just taken a sip from their drinks when they heard someone laughing in French beside them, “BONJOUR! Ladies, may I join you?” Natalie, without looking up, replied in French, “Va-t’en! (Get lost!)”

“Does that mean ‘please sit’? Thank you.” Wang Yang smiled, pulled out a chair and sat down, while his assistant Joshua also took a seat on the other side. Glancing at the inscrutable Natalie and the smiling Rachel, Wang Yang asked, “How’s the script reading going? Any questions?” Rachel shook her head with a smile, “I’m fine, but we’ll only know if you’re satisfied when we’re in the moment.”

Wang Yang nodded, and Natalie turned another page and said, “I don’t have any questions either; it’s quite understandable.” She then took off her large sunglasses, revealing eyes filled with curiosity and intrigue, and said, “But I do have a different question. The newspapers said your company made another acquisition these past few days, didn’t they?” With a raise of her eyebrows and a questioning tone, she continued, “But like those newspapers, I don’t understand why you would acquire Artisan? For those 6000 movies? But…”

She shrugged slightly and said, “I hear they’re not so great. Why? If it’s not something you can talk about, just pretend I didn’t ask.” She flashed a tender smile and added with a giggly voice, “I’m just plotting the course for my handsome Charlie’s movie empire.”

“What’s Handsomecharlie-Films?” Joshua couldn’t help but ask as he looked at a proud Natalie, laughing, “Don’t tell me it’s your company?” Natalie nodded frankly and countered, “What of it? That’s going to be my company in the future.” Wang Yang, grabbing a drink from a passing waiter, said with a smile, “Charlie is her darling.”

Natalie nodded again affirmatively and playfully asked, “So why did you do it? I’ve thought of all the downsides to this acquisition; couldn’t you?” Her comment piqued the interest of both women, and Rachel’s face also showed curiosity. Joshua, propping his hands on the table, glanced at the two women and thought to himself, “Ah, my lovely Natalie! She’s interested in this as well!”

“There’s nothing that can’t be said, but just listen and keep it between us for now,” said Wang Yang, smiling as he met the eager gazes of Natalie and Rachel and the curious look of Joshua. Their desire to know was strong, unlike Jessica who rarely asked about his company’s affairs. When it came to Artisan’s acquisition, Jessica simply smiled and said, “Congratulations! This must be another big surprise, right? Awesome!”

Looking at the two women, Wang Yang gathered his thoughts before continuing, “Your confusion comes from a prevailing business theory, the 80/20 rule. Only best-selling products make money, with 20% of hit movies creating 80% of a company’s performance; conversely, the remaining 80% of poor movies only produce 20% of the performance and are unsold inventory. Producing them can lead to losses any moment, without even securing that 20% performance.”

Natalie, biting on her drink straw, muttered unclearly, “Yeah, that’s why Artisan went under, right? Their movies are all from that 80%, not a single one from the 20%. Does ‘Veggie Baby Adventures’ count?” Rachel also questioned with a puzzled smile, “That’s also why it confuses everyone about Fireflame, don’t you want to invest the money in pursuing that 20%?” Joshua listened intently, his face thoughtful, his attention so focused he ignored even the sizzling beauties passing by.

“Yes, ‘Veggie Baby Adventures’ is part of that 20%, in fact, it sold well,” Wang Yang explained with a smile. “But Artisan’s failure wasn’t due to a lack of blockbuster movies; it was their failure to manage those 6000 movies.” He turned to Rachel, “Pursuing blockbuster movies is the right strategy, but have you considered the risk? You might spend 100 million and end up with a terrible movie.”

Rachel frowned slightly, while Natalie questioned, “100 million turns into bad movies just like that? Without a single opportunity?”

Wang Yang spread his hands nonchalantly and chuckled, “No opportunity, but also no risk. Because, when we acquired them, good movies and bad movies already had price tags. 100 million for 50 good movies, or 5000 bad movies, you buy what you like, and there’s no risk in spending that money. Many wonder why Fireflame doesn’t finance films; it’s because we don’t need venture capital, we need a safe path.”

“Still, you haven’t explained why we acquired Artisan. You think those 6000 movies are worthless.” Wang Yang took a sip of his chilled drink to moisten his throat, then looked at Natalie, Rachel, and Joshua, “But that 80% isn’t worthless; they can make money, because times have changed! They’re just as important as the mainstream 20%!” He laughed, “Guys, it’s no longer the era dominated by the 80/20 rule.”

Feeling excited to hear the crucial point, Natalie mused to herself, “This guy’s used to directing; even his everyday speech can stir emotions.” She had some business savvy—the 80/20 rule no longer ruled? She asked, “Why?” Joshua, although not quite getting it, tried hard to remember, feeling his memory was better than ever.

“The Internet has changed everything, drastically lowering the attention cost for any product.” Wang Yang listed off on his fingers, “You know, there’s search, Amazon, Ebay… a regular person will search online, make purchases. In short, it’s no longer ‘what we can offer to customers’ but ‘what customers demand from us.’ There’s no such thing as an unwanted product; even the coldest movie has a certain sales and rental volume over a year.”

Natalie’s eyes lit up instantly, and she blurted out, “Are you saying that 20% of the annual total sales of 6000 movies have the effect of mainstream ones?” Across from her, Rachel blinked and asked, “Are there really that many?”

Wang Yang nodded with a smile, the company’s operations over the past few years had proven it. He laughed, “As long as the channels are wide and plentiful, the total sales of those non-mainstream movies with very little demand can match the total sales of mainstream movies with large demand. For example, ‘Star Wars Episode I’ sells 100 sets in one day. Despite the poor reviews it received and the female lead’s performance being criticized as terrible, it indeed belongs to that 20% of movies.”

“Haha!” Natalie nodded in agreement, pretending to be clueless, “Who played the female lead in that?” Joshua quickly said, “Natalie Portman!” Wang Yang said, “Keira Knightley.” Natalie, biting her straw, shook her head and said, “Don’t know either of them.” Rachel revealed a slight smile without speaking.

Under the gaze of the three, Wang Yang continued with a smile, “It sold 100 sets, but ‘Cult Movie 1,’ ‘Cult Movie 2,’… the total of 1000 unsellable movies also amounts to 100 sets a day. So now the situation is that mainstream products account for 50% of the sales, and non-mainstream products also account for 50%, but do you know how fierce the competition is in the former market? Why not do this…”

Seeing him apparently searching for a word, Natalie quizzically “YEH?” making a sound, and Rachel tried to prompt, “Niche market?” Wang Yang suddenly recalled a future adjective to describe this market characteristic. While pulling out paper and pen to draw storyboards from his pocket, he laughed, “I don’t know, it’s like a long tail. This long tail represents the past 80% of goods that were unsellable, but it has realized the total of many, many small markets.”

Natalie and Rachel both tilted their heads to look at the paper being drawn on the table, with Joshua also propping up his hands to peer over.

Wang Yang drew a slope-like shape on the paper with a pencil, pointing at a short peak in the graph and laughed, “These are mainstream, just 100 movies, 50% sales.” Then, pointing to a long descending line ending in a tail-like stretch, he laughed, “This is the long tail, 10000 movies, 50% sales. Why not focus on this tail? Why fight to the death with others at the head?”

“It does seem to be that way…” Natalie pondered over the drawing, then turned to Wang Yang, asking a crucial question, “Are the costs the same for 100 and 10000 movies?”

“Originally, they were not, so the 28 law ruled the market, but as I said, thank God for the Internet! And for such developed information today!” Wang Yang put down the pen, raising his hands in a celebratory gesture. Rachel and Natalie laughed along as he laughed, “All this can reduce the cost of sales per product, don’t look at Flame Film having over 8500 movies…”

He smirked with a crinkled nose, whispering, “But we hardly have any inventory. We only burn the discs when a customer places an order online, and the video rental stores around have demand. Then we deliver it to them. What cost is there?”

Remembering the company’s performance in the past few years, Wang Yang added, “And because we have a large base, the volatility of total revenue is smoothed out by the law of large numbers, making the growth of this long-tail revenue very stable.”

As he spoke, Natalie and the others had understood it was always possible to accumulate little by little, but in the past, the more variety there was, the higher the per-item sales cost became, ultimately making it unprofitable or even a loss. This is like a disc store needing 100 square meters to put 1000 movies on the shelves; how much more space would be needed to display all 10000 movies?

But the Internet significantly reduced the cost, making it possible to overturn the 28 law. Packing a million movie listings into a website would require much less than a physical store like a supermarket would need to display just a hundred movies…

Now, the long tail of Flame Film is like McDonald’s delivery service: we make and sell only if there’s a buyer, and there’s simply no loss on this business alone. However, this is predicated on actually having that many customers frequent the long tail.

Natalie, thinking, couldn’t help being amazed and asked as Rachel did just before, “Is the total sales of those cult movies really that high?” Rachel, eager to get an answer, also looked at Wang Yang.

“According to the situation with our original 2500 movies, YES!” Wang Yang nodded emphatically, raising his drink in a toast and said with a laugh, “Our goal is clear, FF takes the head, and FM handles the long tail. Just watch whether Flame Film will go out of business or keep getting better.”

With that, he drank his beverage to quench his thirst.

Having received their answer, the trio fell into a reflective silence, digesting what they had heard.

“Wow…” Natalie muttered in wonderment, her eyebrows perked up with interest as she asked, “I think this is an incredibly great business philosophy, what should it be called, ‘Long Tail?'” Rachel also smiled and said, “The Long Tail Theory?” Joshua was repeating the words “The Long Tail Theory” under his breath, committing them to memory.

Wang Yang smiled, reminded of something, and with renewed enthusiasm, he said, “That’s right, you guys might know this, or maybe not, but Blogger introduced a new system a few days ago, now you can make money by blogging!” Joshua immediately became very interested and asked eagerly, “How so? I really didn’t know, you can make money from blogging? How much?” Rachel vaguely recalled this and asked in confusion, “That Google ad placement system?”

“Yes, Google AdSense. Individuals can join and publish ads, and you get a commission every time there’s a click,” Wang Yang explained, shrugging his shoulders. He believed this system could benefit Blogger and many other websites, perhaps even launch them to new heights. Looking at the trio, he continued, “If you’re a small website, you can also join and publish ads; if you’re a company, you pay Google a certain advertising fee, and then you’re in the ad system. That’s the Long Tail Theory.”

Natalie listened, feeling somewhat puzzled again, until she saw him shake his head with a sigh, “You wouldn’t believe what Google could get out of this, think about it, they can quickly gather millions of small and medium-sized websites, hundreds of millions of individual customers. If you took any one of them out alone, they’d seem like an atom compared to the big advertisers working with Yahoo or Microsoft; but the sum of this long tail…!”

He didn’t reveal any specific answer as he laughed, seen by the three who were deep in thought, and simply shrugged and continued with a laugh, “If I were Yahoo, or Microsoft, I’d be fully committed to developing similar technology right now, otherwise their status on the internet will definitely be caught up with by Google, then surpassed, and then defeated… Seriously, Yahoo is such a disappointment now, not because of Terry Semel’s management, but because its technology is constantly falling behind and failing to keep up with trends… I have no idea what Jerry Yang is doing, but if this continues, Yahoo will be slowly eaten away by Google, and within a few years, it will be too late…”

As he spoke passionately about IT, the trio gradually lost track of the conversation, with incomprehensible talk about Yahoo biting off more than it could chew, and Google taking a cool approach… Seeing him looking like he so wished he were Terry Semel, becoming the CEO of Yahoo, Natalie couldn’t help but burst into laughter, almost spitting out her drink, “What kind of Best Director is this?” She laughed and asked, “Why don’t you study IT?”

Rachel also laughed and said, “Now there’s a new IT superstar.”

“Maybe.” Wang Yang chuckled and scratched his head, no longer continuing with the Yahoo Google talk, instead he said “I did consider applying to Stanford, either the business school or computer science, but then I didn’t.” Natalie asked curiously, “Why not?” Wang Yang burst into laughter, looked at the three, and shrugged, “Why not? I applied to University of Southern California, New York University, UCLA… all for film production majors. Why? Because I like it.”

With an encouraging smile, Natalie said, “Please, brother! You should have gone to Stanford at that time! Then I wouldn’t be sitting here now, I should be attending classes at Harvard. It’s all your fault for making me skip class.” Wang Yang looked at his watch, stood up, and said, “Yes, if I hadn’t studied film, I wouldn’t have met you guys. Forget it! Talking about IT is okay, but working on it every day as a job would drive me insane.”

He shook his head with a laugh and said, “That’s not the kind of dish I’m after, film is.”

“Haha, it seems someone got carried away by someone’s legs,” Natalie said with a suggestive laugh; Rachel didn’t understand these seemingly random words, but she started to suspect something and smiled as she glanced over at Natalie… Sure enough!

“You guys continue looking at the script, I’m off, going back to discuss the shooting plan with Varèse,” Wang Yang said with a smile, then turned to Joshua, who was lost in thought, and called out, “Joshua? Are you staying?” Joshua nodded, saying, “OK.”

Inside Caesar’s Palace casino, the intense faces of the gamblers were illuminated by bright yellow lights, mingled with the continuous chiming of slot machines, the ecstatic cheers, and the angry curses…. The “MIT 21 TEAM” crew occupied a central passage, with the twinkling screens of slot machines on both sides, and two cameras were set up in appropriate positions, with one in the front and one in the back, as the large production team took their places.

Wang Yang squinted at the viewfinder of the camera, as the disguised MIT team stood in front of the scene. He directed, “Natalie, move a little to the left; Ali, step forward…”

Following his instructions, Natalie, wearing a long brown wig with heavy eyeshadow, and Alexis with her long golden ponytail, both adjusted their positions on set. With the positions of Rachel and the other casino personnel on one side already set, and seeing that everything was in place here, Wang Yang raised his head from the viewfinder, smiled, and called out, “Alright, let’s start!”

This was a feature performance, and after relentless effort, female detective Belliveau had finally intercepted the cunning MIT group during yet another of their operations, declaring the capture of this band of genius card counters.

“Gentlemen, ladies, we know who you are!” The casino security guards, clad in black suits, blocked the way from front and back, eyeing the MIT group with a fierce gaze. The towering, bald-headed head of security said coldly, “You’re no longer welcome here!” Then, suddenly, the dozen or so casino guards stepped aside, and Rachel, who was behind them, slowly walked forward. She wore a gray-white detective’s overcoat and had a subtle smile hanging on her lips.

With a look of victory, pride,, and joy… Rachel stepped forward and stopped, scanning the members of the group opposite, one by one. If this were a movie screen, each look would have been a specific shot—Nick Cannon, Jay Baruchel, Karen Mok, Alexis, Daniel Wu—finally, her gaze landed on the less than one-meter-tall Natalie, her eyes filled with a sense of triumph, and she said with a smile, “The game is over.”

Natalie’s face was calmly smiling, as if it was no big deal, just a game of hide and seek with friends where she got caught. Alexis could barely contain her irritation and exclaimed, “You think you’re a superhero? The casino is not God; it doesn’t have a divine right to rake in money. We’re just legally making a buck off them! By helping the casino, you’re just aiding an evil devil!”

“Excuse me?” Rachel cocked her ear with a somewhat puzzled look on her face, then slowly revealed a devilish sneer as chilling as the one in “Paranormal Activity.” She laughed and said, “What’s that got to do with me? Let those idiots who dream of getting rich overnight die, let them! It’s legal, too. But I’m not interested in that. My only interest is capturing you folks.”

Jay Baruchel and Karen Mok wore cold expressions, and just as Daniel Wu seemed about to say something, Natalie suddenly chuckled and nodded, “The game is over.” She lifted the bulging chip bag in her hand and looked at the burly head of security, asking, “By the way, these chips can still be cashed in, right?”

Watching the performance at the scene, Wang Yang crossed his arms without any objection, feeling very satisfied. These days, the on-screen chemistry between Natalie and Rachel had been very interesting, as they both brought out the charm of their characters through their demeanor, tones, and actions.

Rachel was cool, but with an inadvertent action or line, Natalie was even cooler than Rachel. This was naturally by design because the audience was meant to stand with the MIT group, and the detective’s coolness served more to highlight by contrast.

“CUT! That was an excellent performance! Natalie, Rachel, you both really got the feel. What else can I say? Change the angle and keep going!” Wang Yang called cut with a smile and patted Valery Furst, who was operating the camera, on the shoulder.

Over there, Natalie and Rachel each stepped forward, faces full of smiles, as they raised their palms and gave each other a vigorous high-five, showing no sign of the tension present just moments before.

While everyone adjusted the camera positions and chatted with laughter, Jay Baruchel asked Kevin Spacey on the side of the set, “What was it like for you guys at the time?” Kevin Spacey laughed and said, “It wasn’t as suave; we were still confused about how they figured us out…”

Wang Yang walked over to Daniel Wu and said, “Daniel, I wasn’t that satisfied with your shot just now. I’m going to need a few close-ups later; you seemed a bit expressionless, without emotion…” Daniel Wu listened intently, nodding frequently.

Joshua enthusiastically handed a bottle of water to Alexis, acting like her personal assistant, and praised, “Wow, when you were delivering your lines just now, I could totally feel that sense of being in character yang always talks about! How do you do it? My acting has always been pretty bad.” Alexis unscrewed the cap and took a sip of water, smiling, “Thanks, I guess it’s all about feeling…”

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PS: I’m really hoping for monthly votes and recommendation tickets, as the rankings keep dropping every day, so any support would be great, thank you! My mom’s gamma knife surgery went well, and as long as there’s no recurrence, she’ll be fine, thanks everyone for your blessings! ^0^