Disneyhead seem to suggest it would be WB paying Universal essentially operating their park and designing attractions in lieu of the paying a licensing fee and WB would be paying for the attractions for a small portion of the profits.
Which was my point as why it would be bad if entertainment partners decided to cheap out since they dictate attraction costs as they are paying for it.
Oh I see. Yeah, given how Universal is financing these park investments (borrowing for the immediate expenditure and then paying off with cash flow from the resorts' profits), I don't think Universal would want a cheaper arrangement like that. Universal resorts throws off $2 billion+ in annual earnings before interest/taxes/depreciation/amortization.
Could it be cheaper for Universal? Sure. But it'd be a smaller overall profit pool for Universal too so I don't think they'd do that.
More likely would be Universal borrowing $1.5-2 billion to build a 100 acre "Warner Movie World" and then giving Warner 30-40% of the park's profits in exchange for a permanent right to use their name and DC in Orlando (assuming DC in Orlando is carved out of the Six Flags deal). Maybe toss in LOTR movie look as well and I'd call it a fair deal. Warner would earn $60-80 million+ a year for just giving its name and DC/LOTR rights.
Obviously a lot of conjecture here, but WB holds the cards here. They will be the ones dictating the terms of the next HP and LOTR contracts. If they decide this is the way they want to do it, I'm not sure Universal can just say no.
In a weird way, the Warner-Universal deal for Harry Potter is now like a cable channel carriage agreement for paytv providers...
Why? Because imagine the scenario where Universal and Warner are unable to come to terms by June 30, 2029. Do you want to imagine what attendance would look like that winter if Harry Potter is completely closed in USF/IoA post-expansion?
I'm not saying that would happen, but it's just a point of reality that Universal is now extremely dependent on Warner for USF/IoA given how important Harry Potter is.
If that extends to LOTR (i.e. using the movie look from Warner as part of a Tolkien deal) as well as DC in a potential 4th dry park, then I'm sure Universal might want a more permanent arrangement.
There'd be a very heavy reliance on Warner at that point, and unless there's something more permanent than 15-20 year deals, it's a double edged sword. Great IPs, but very costly.
An example of a more permanent arrangement would be a permanent fixed ratio of profits in exchange for rights (maybe closer to the Spielberg deal but not quite as open ended) like I mentioned in the above response if a bigger deal was worked out for the 4th dry park.