Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Hollywood's A-list losing star power (Dinosaur Media DeathWatchâ„¢)
Variety ^ | October 16, 2008 | Anne Thompson

Posted on 10/19/2008 1:12:14 PM PDT by abb

Film industry forced to change business model

Star value isn't what it used to be.

In defense of movie stars -- yes, Hollywood still needs them. But the opening of the Ridley Scott-directed thriller "Body of Lies" provides a vivid reminder that stars do have the potential to boost any movie ... as long as they don't cost too much.

Suppose Russell Crowe and Leonardo DiCaprio had been paid a third of their going rate, and the movie had cost a third less. Would the pic's $13 million opening frame have been seen as such a disaster?

Hollywood's problem is that once costly stars climb aboard a project, studios tend to ratchet up the scale with stunts and effects. They wind up trying to turn every movie into a tentpole.

Sure, the studios have pots of money to play with. But just like the world economy, the film industry has burgeoned out of control. It's inflated and overblown. It needs to let some air out of the bubble and return to a more reasonable size and scale.

For starters, Hollywood ought to throw everyone out of the $20 million club.

Warner Bros. insists it didn't pay full freight for DiCaprio and Crowe; they share the pic's adjusted backend gross. The CIA actioner, set in Iraq and Jordan, cost more than $100 million, not including worldwide marketing costs. Warners should have thought twice when it couldn't find a partner for the film. But execs thought they had star insurance; the studio could write off as much as $100 million on this picture.

The brutal truth about today's Hollywood is that the majors have been releasing too many films that cost too much money. Disney, notably, has gone the other way. Not only has the studio scaled back its releases, it's refusing to pay backend gross participants on its tentpoles until after the studio recoups its costs.

Paramount, in the wake of its DreamWorks divorce, plans to scale back to 20 films a year.

"What's going on in the economy on a global basis has an impact on every business," says studio chairman Brad Grey. "We're streamlining the company to make it as lean and agile as possible. You can be sure we will deploy our capital in a diligent and prudent fiscal way."

While Grey is still pushing forward with tentpoles like "Star Trek," "G.I. Joe" and "Transformers 2," he says he's "aggressively restricting backend deals," with first-dollar gross capped at 25%.

"It's incumbent upon everyone in the industry to look at our economics," he says.

The entertainment biz may be resistant to economic downturns, but studio owners are not. They're all carrying increasingly expensive debt. Paramount's owner, Viacom chairman Sumner Redstone, was forced to sell National Amusements stock to meet his margin calls. And Warren Buffet bought stock to bolster NBC Universal owner General Electric's fortunes.

This is the perfect time to fix the studios' broken economic model. The studios have to just say "no."

"We're at a crossroads," says producer Mark Johnson. "So much of what we've counted on isn't working. It's not a question of old school vs. new school. It's Lewis and Clark time, the things we're not sure about, that we hang our hat on, like movie stars."

Today's astronomical price inflation basically starts with nervous studio heads overpaying for movie stars.

Twentieth Century Fox was the first studio to top the $1 million payday mark with Elizabeth Taylor on the 1963 mega-flop "Cleopatra," which, with inflation, is still the most expensive movie of all time.

And back in 1988, there was much handwringing when Fox paid $5 million to Bruce Willis (who had made just one film, "Blind Date") to star in "Die Hard."

"This throws the business out of whack," MGM chairman Alan Ladd protested to the New York Times. "Like everybody else in town, I was stunned."

Paying a relative novice like Willis such a sum meant that all the other stars, such as Dustin Hoffman, who had scored $5.5 million for "Tootsie," had to get a boost. Indeed, there was nowhere to go but up during the boom-boom '80s and '90s, as upstart players like Cannon and Savoy paid hefty premiums to land stars such as Sylvester Stallone.

Then in 1996, Columbia Pictures, desperate to nail hot comedian Jim Carrey for "The Cable Guy," paid him $20 million. That meant all the other top stars, from Tom Hanks to Tom Cruise, had to get that sum, too. When Demi Moore landed $12.5 million for 1995's Striptease, the men had to get that much more. When Universal gave away first-dollar gross to Arnold Schwarzenegger on "Twins," it opened another Pandora's box.

After a long list of stars routinely commanded $20 million vs. 20% of the gross, studios even started sharing more of their DVD revenues with certain stars. Eventually, global action heroes like Harrison Ford and Mel Gibson were commanding $25 million, forcing other actor and director salaries up in relation. Even a midrange star like Kurt Russell was earning $15 million.

The movies that had to carry these fees became safer, more formulaic and less interesting, and to make their money back they needed to perform on a global scale. "The bigger the movie stars become," says Johnson, "the more constricting their roles and the scope of their roles."

Sequelitis contributed to boosting star fees. Once stars got paid a higher figure, agents would demand it again.

Studios vied for the stars and used paydays and perks (such as overpaid hair and makeup people, entourages, nannies, and chartered jets) to sweeten the pot. They indulged monstrous behavior and demands.

Finally, after Schwarzenegger collected $25 million to play Mr. Freeze in "Batman & Robin," Intermedia and C-2 paid the muscled star an unprecedented $30 million for "Terminator 3." Schwarzenegger may well be remembered in the record books as the highest-paid star of all time.

Today, new production company MRC, trying to compete with the studios, is offering talent like Sacha Baron Cohen not only a hefty upfront fee but an ownership stake in movies like "Bruno." "They're sharing our revenues," says president Tory Metzger, a former CAA agent. "Our upside is their upside."

But the overdue market correction on star salaries is already trending down. The studios are capping backend grosses at 25%. And they're insisting on recouping costs before delivering gross payouts, and they're putting overage limits even on top directors.

Viacom's Redstone signaled a seismic shift when he angrily ousted Tom Cruise from his Paramount deal after the star made more money than the studio on "Mission: Impossible 3" -- even after Grey had altered the backend formula.

Marvel is hanging tough with deals on its "Iron Man" sequel and was willing to walk away from Terrence Howard's pay demands to play War Machine, casting Don Cheadle instead. Marvel is investing in its characters and properties and isn't playing the studio game.

Lionsgate's Joe Drake ("Juno") is also hoping to eschew business as usual. But when he visited a major agency recently to discuss a slew of new projects, they asked: "Will you pay our clients' full freight?" While he doesn't see wholesale reform, Drake says, by giving talent more creative say in upside success, "there is an opportunity for the talent and the creative side to align their interests with the distributor, without the traditional push-pull relationship."

The studios don't have to play the same old game, either.

Bring costs down and they'll gain more flexibility to make better, more interesting and varied movies. They could lure adults back to theaters and appeal to niche markets without having to play it safe with four-quadrant pics.

If stars and studios want to make different movies, the studios don't have to indulge the stars: Let them go to the indies.

"Everybody's been riding the gravy train and nobody wants to get off," says one agent.

There are other ways to make studio movies on a slimmer scale.

Consider the George Clooney model: "Syriana," "Good Night, and Good Luck," "Michael Clayton" and "Burn After Reading," like the "Ocean's" series, all featured multiple stars working for less than their usual fees.

There's also the Clint Eastwood paradigm: His films are always produced with modest upfront costs.

"Going forward with anything execution-dependent," says one Warners exec, "we will try different formulas. The world has shifted."

Producers describe a distinct industrywide course change since the writers strike. Unfortunately, that often means studios shelling out for top talent while cheaping out on everything else. "Everyone is refusing to pay for anything," says one producer. "With the economy tanking it has gotten worse, with people walking away from deals: 'We're not paying your quote. Take it or leave it.' It's really scary. People who are trying to make a living are not making a living."

Ironically, Carrey, whose asking price has been in the toilet lately, stars in a Warners comedy that may hit the zeitgeist on the nose: In "Yes Man," he plays a negative guy who makes a pact to say yes to everything. Carrey said yes to not getting his usual price in a mainstream comedy. And if the movie hits, he collects -- bigtime.


TOPICS: Business/Economy; Extended News; News/Current Events; Politics/Elections
KEYWORDS: culturewars; dbm; hollywood; movies; television
Navigation: use the links below to view more comments.
first previous 1-2021-40 last
To: abb

>>>New Ways of Financing Journalism Will be Found, Georgia Journalists Say at NPC Forum

Last update: 1:04 p.m. EDT Oct. 15, 2008
ATLANTA, Oct 15, 2008 /PRNewswire-USNewswire via COMTEX/ — The future of journalism may be in niche products supported less by advertising and more by corporate sponsorships, by interest groups and by public broadcasting-style memberships, leading Georgia journalists said at a National Press Club Centennial Forum here Tuesday.<<<

Speaking as a former journalist...

Journalism will become what it used to be - a guy with an attitude, a printer, and a box of paper, supported by readers, sometimes, but usually supported by the writer’s own skills and struggle to put his or her thoughts to paper.

The modern difference is that the paper is less important than it used to be, and the street corner or the public square is now as large as the Internet.


21 posted on 10/19/2008 1:47:25 PM PDT by redpoll
[ Post Reply | Private Reply | To 6 | View Replies]

To: USFRIENDINVICTORIA

It’s a double edged sword. They need an Alister to get funding, but I never understood why they would put so many in one movie.


22 posted on 10/19/2008 1:48:56 PM PDT by teacherbarbie
[ Post Reply | Private Reply | To 10 | View Replies]

To: Marauder

For me it’s got to be the movie and the star I want to see. I won’t see movie for a star I don’t like. That just puts money in their pockets.


23 posted on 10/19/2008 1:52:06 PM PDT by teacherbarbie
[ Post Reply | Private Reply | To 15 | View Replies]

To: Arizona Carolyn

I’m curious to see how well Matt Damon does now after what he said about Sarah. Afleck tries to be low key now. I will never pay to see Angelina Jolie or Brad Pitt again.


24 posted on 10/19/2008 1:55:58 PM PDT by teacherbarbie
[ Post Reply | Private Reply | To 7 | View Replies]

To: abb

To All. I really enjoy both the subject (projected final downfall of Hollywood) and the humor with which it is discussed. Only on FR do you find the types of information that will help to improve the quality of our lives but ultimately, “Save the Republic”.


25 posted on 10/19/2008 2:01:43 PM PDT by gartrell bibberts (Good border security = high priced tomatoes. OK.)
[ Post Reply | Private Reply | To 13 | View Replies]

To: abb

“How will we be able to tell the difference?”

The actresses will be better looking.


26 posted on 10/19/2008 2:25:24 PM PDT by ansel12 ( When a conservative pundit mocks Wasilla, he's mocking conservatism as it's actually lived.)
[ Post Reply | Private Reply | To 13 | View Replies]

To: abb

There’s plenty of both karma and irony in the fact that “Body of Lies” with the arch-enviro DiCaprio in it, is full of enormous petrol explosions. It’s good that the public, forced to note the actor’s position can see what a “do as I say, not as I do” clown he is. Shouldn’t the ideal movie for DiCaprio be him, his bare feet, a field of clover and a love song to Gaia? He tanked in the completely ridiculous “Speed Racer” and now this dud.


27 posted on 10/19/2008 2:38:43 PM PDT by februus
[ Post Reply | Private Reply | To 1 | View Replies]

To: abb
“So much of what we've counted on isn't working.”

You don't know how to tell a story.

Ever since Speilberg (who's a pretty talented filmmaker)came along with his way of making it look so simple (much the way many old Blues players make blues guitar playing look simple)many in Hollywood labor under the conviction that story-telling and film making are purely mechanical and reducible to a modular process, ie; put this type of scene here, have this type of character there, put one of these about the middle, then add the same high end musicians playing the same type of score in the same high end room and mixed thru the same monster high end board, edit and--viola! A movie! Hollywood has never been better on the technical end but the brain dead imposition of pure formula on a script (and even to the writing of the script itself)robs the outcome of the force it might otherwise have.

28 posted on 10/19/2008 2:45:11 PM PDT by TalBlack
[ Post Reply | Private Reply | To 1 | View Replies]

To: abb
The brutal truth about today's Hollywood is that the majors have been releasing too many films that cost too much money

The brutal truth about today's Hollywood is that they have no stars worthy of the title, just a bunch of overrated overgrown adolescent posers, punks and sluts. And by and large their movies suck.

29 posted on 10/19/2008 2:55:59 PM PDT by hinckley buzzard
[ Post Reply | Private Reply | To 1 | View Replies]

To: teacherbarbie
They need an A-lister with today's movie economics model.

When the cost of distribution, along with other fixed costs of movie making, drops as the digital technology takes hold; the break-even point can be reached with a much smaller audience. The A-listers won't be needed to draw block-buster sized audiences. Digital distribution, combined with cutting star salaries to a third, would cut $30 million or more from the cost of producing a movie. That would allow another $15 or $20 million to be trimmed from the promotions budget. The average cost of “A” movies could easily be cut in half.

Another result of lower production and distribution costs will likely be a greater number of movies being made. Just as there are many more TV shows now, than in the days of the network oligopolies — the major studios will lose their oligopolistic powers over movie making. Who knows, there might even be some movies targeted toward a FR audience.

30 posted on 10/19/2008 2:57:12 PM PDT by USFRIENDINVICTORIA
[ Post Reply | Private Reply | To 22 | View Replies]

To: USFRIENDINVICTORIA

What MALE is an A-List star anymore??

Who is this generations John Wayne, Clint Eastwood, etc.?

Sissified males like George Clooney? Matt Damon? Leonardo DiCaprio?

They’re phasing out the last crop of macho males like Arnold, Mel Gibson, Stallone, etc. all “men” now must be simpering wussies to appear on screen.


31 posted on 10/19/2008 3:03:25 PM PDT by word_warrior_bob (You can now see my amazing doggie and new puppy on my homepage!! Come say hello to Jake & Sonny)
[ Post Reply | Private Reply | To 30 | View Replies]

To: Arizona Carolyn
Body of Lies likely suffered from having Leo in one of the starting rolls; I don’t think I am the only one who will not pay to see a DiCaprio, Afleck, etc. movie.

You are absolutely right. Body of Lies could be the best flic of the year and I wouldn't see it.

32 posted on 10/19/2008 3:08:53 PM PDT by Tidbit (Shoot low boys, they're riding Shetland Ponies.)
[ Post Reply | Private Reply | To 7 | View Replies]

To: word_warrior_bob
As I said, in the near future: “The A-listers won't be needed”. You've just described one reason why that won't bother me.

That said, I thought Daniel Craig's version of Bond (in Casino Royale) was pretty macho. It was a darker, more deadly Bond. Also, I liked it when his Bond said: "Do I look like I give a damn?" (When asked whether he wanted his martini shaken or stirred). This Bond isn't an effete metro-sexual.

33 posted on 10/19/2008 3:15:20 PM PDT by USFRIENDINVICTORIA
[ Post Reply | Private Reply | To 31 | View Replies]

To: USFRIENDINVICTORIA

Daniel Craig said he won’t mind if James Bond has a homosexual affair in the next Bond, it’s been discussed to “modernize” Bond. I kid you not.


34 posted on 10/19/2008 3:22:41 PM PDT by word_warrior_bob (You can now see my amazing doggie and new puppy on my homepage!! Come say hello to Jake & Sonny)
[ Post Reply | Private Reply | To 33 | View Replies]

To: word_warrior_bob

I want off this planet!


35 posted on 10/19/2008 3:27:20 PM PDT by USFRIENDINVICTORIA
[ Post Reply | Private Reply | To 34 | View Replies]

To: abb

I will no more mourn the death of hollywood than I would the death of osama bin laden, both are mortal enemies of America and the good and decent people who live here.

Where the vast majority of hollywood scum are concerned, I say good riddance to bad rubbish.


36 posted on 10/19/2008 3:50:21 PM PDT by Dr.Zoidberg ("Shut the hell up, New York Times, you sanctimonious whining jerks!" - Craig Ferguson)
[ Post Reply | Private Reply | To 1 | View Replies]

To: abb
Here's the big problem: using big stars ends up with just too much front loaded production costs to the movie, and that can result in a financial fiasco in no time flat!

The movie industry needs to follow the Clint Eastwood model of filmmaking: make every star earn their money by taking a percentage of the actual box office revenue of the film. As a result, Eastwood's movies don't end up with ridiculous front loaded costs, gets completed in production in short order, and this style of filmmaking has resulted in a lot of critical praise (and several Oscar wins, too). In fact, one of the truly great actors of our time (Jack Nicholson) nowadays does his movies by taking a percentage of the box office revenue instead of being paid up front, mostly because he already is very rich from his numerous past acting roles (he owns two houses side by side in the Bel Air section of Beverly Hills, CA).

37 posted on 10/19/2008 4:09:41 PM PDT by RayChuang88
[ Post Reply | Private Reply | To 2 | View Replies]

To: Dr.Zoidberg
Radical Islam and the neo-Communists of Russia and its allies are the enemies outside our shores; Hollywood, the MSM, and academia are the enemy within.
38 posted on 10/19/2008 5:50:48 PM PDT by Wallace T.
[ Post Reply | Private Reply | To 36 | View Replies]

To: Wallace T.
Hollywood, the MSM, and academia are the enemy within.

The worst thing about Hollywood is their attempt to corrupt our youth and take away their childhood. If a kid wants to see an r-rated movie, he'll get the video or watch it on HBO.

39 posted on 10/19/2008 6:17:28 PM PDT by Dr. Scarpetta
[ Post Reply | Private Reply | To 38 | View Replies]

To: teacherbarbie
They need an Alister to get funding

That can't be right. Offhand I can't even think of a movie starring an actor named Alister. Hollywood seems to be a No Alisters Club.

40 posted on 10/19/2008 9:35:50 PM PDT by Oztrich Boy (Every difference of opinion is not a difference of principle - Thomas Jefferson)
[ Post Reply | Private Reply | To 22 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-40 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson