How have the studios morphed over the years?
I think the studios have morphed largely to deal with the ever-changing nature
of the audience. ... And the bottom line for the studio is to make money. They
won't make art for art's sake, but they'll make art to make money. I think the
viewing habits of the audience have changed. ...
The studio will always change to fulfill the needs of the market. John Calley
said it really well about six months ago [in an interview I read]. John Calley
was chairman of Sony Pictures. He said, "I'm just tired of having to dynamite
people out of the houses in order to get them to see movies." The fact of the
matter is [that] there are those audiences who still need to leave the house.
Who are they? They're teenagers, which is the [largest] audience on a worldwide
basis, because they've got to get away from Mom and Dad. There's kids --
they've got do something on Saturday. And there's young adults who, in large
part, need to find a cheap place of entertainment in order to be able to go on
The older demographic has really faded from moviemaking. The more sophisticated
and edgier material that would appeal to an intelligent adult audience is
really now on television, which I think is probably a really good thing. If
viewing habits hadn't changed, you may not see "The Sopranos" on HBO or "Sex
and the City." But the adult audience is very comfortable seeing a movie on
television after six months of a theatrical release. So the content, therefore,
has needed to be adjusted for these audiences who need to find entertainment
and who need to leave the house. That's why there's so many wonderful projects
that really can't get made anymore, because teenagers don't want to see it. The
kids who saw "Toy Story" and "Shrek" don't want to see it, and, the young sort
of dating audience don't want to see it. So the sort of pictures like "Random
Hearts" are really going to be seen in the future on television, and not have a
What are these giant companies to the studios?
There were two historic things that happened over the last 12 years that
changed the fact of the business. Actor fees were getting a little out of
control. But Columbia made a deal, rightly or wrongly, for Jim Carrey for $20
million for "Cable Guy." That blew the lid off star rates. That changed the
business dramatically, because everybody else needed to get to that $20 million
dollar range. ...
Secondly, there was a movie at Disney that was not testing well called "Dick
Tracy," but Disney had a huge investment on it. It was coming out in June, so
they had to really go against this sort of word of mouth and really heavily
promote it. So they promoted it significantly higher than any other movie
that's ever been. So the marketing cost on that got to a certain level, and
everything else had to adjust. So between Jim Carrey and "Dick Tracy,"
everything went up significantly.
That became a problem for the studios, because they wanted to try to find a way
to try to mitigate their risk. So they got involved with other partners that
they normally wouldn't -- a German fund splitting up their rights.
There was a great cartoon in The New Yorker about eight years ago, where
there were 100 guys sitting around a round table all in suits, all with grey
ties, each looking at each other, and said, "Let's green-light this, boys." You
know, before, it was one guy; now there's a hundred people around the room. And
in order to be able to get those hundred people around the room -- I'm speaking
metaphorically -- you need a star. You need a homogenized piece of
entertainment, action-adventure, comedy -- something that is not particularly
edgy, particularly sophisticated, that everybody can feel comfortable with,
that is not making a political statement, that is not making a racial statement
-- but is basically just good, fluffy entertainment.
What has that done to guys like you?
Well, we ourselves, we're small, independent. We've made pictures like "Big
Night," and "The Opposite of Sex." We have another picture, "Whole Shebang,"
which Lion's Gate is releasing in the fall; but they're smaller movies. We've
largely made pictures for the specialized area. But it's impossible to really
make a living, cover your overhead, be able to continue to fund your next year.
So what we've done is we've joined forces with a German company, who basically
now bankrolls us. And we have a mandate to now move into the big
action-adventure area, the teenage comedies, the family event movies in the
area of, like, "Toy Story" or "Bug's Life."
We've had to change. We'll continue to work in the specialized area, but we've
now needed to grow with the market and provide entertainment for the worldwide
market, as opposed to the sort of more art house movies. We're going to keep
our hand in that, but we've had to really change.
Do you have any personal feelings about that?
Well, I think the most dramatic thing for me to adjust to is that I've never
been a television advocate. I've largely seen television as sort of fodder. But
I think television has changed -- significantly for the better -- in the last
couple of years. Who would have thought that HBO or Showtime would become,
really, the sort of cutting edge of entertainment -- certainly in America? It's
readjusted us to look more towards television in order to be able to provide
more sort of sophisticated adult entertainment, simply because we can't make
that for theatrical anymore. It's been an adjustment but ... if you're going to
survive and be prolific and try to make something that's of value, you've got
How has the management style of the studios changed?
The culture has changed by virtue of, 20 years ago, you had one guy who would
make a decision as to whether or not something would be green-lit. Today,
you've got multinational companies coming together to green-light a movie. You
have to stay in touch with your e-mail, because your German partner needs to
respond on a casting choice or your Japanese partner needs to sign off on the
It's not just one guy coming in to fund a movie. It's tens or several different
corporations coming together. That's changed significantly. Before, you could
have a handshake on a deal and say, "We're moving forward on it." Twenty years
ago at Paramount, you made a picture commitment with 15 pages of documents.
Today, it's probably six yards high. Legal has become a very big force in it.
And that's pretty boring, but necessary.
What does all that do to the kinds of films we see?
I think that the kinds of films that we see are becoming more and more
homogenized, because you have more and more people involved in the
decision-making process. A particular character or a particular scene might
offend somebody in Europe. A particular point of view might offend somebody in
Japan. And so things are coming a little closer into the middle, the standard
being worldwide entertainment.
When I was starting out at Paramount 20 years ago, we never really considered
the foreign market, which is now about 60 to 70 percent of the total revenue on
any given picture. Twenty years ago, it was probably 10 percent or 15 percent.
So anything we got was sort of gravy in that place across the ocean. Today,
it's a very, very big part of the profit we turn on a picture.
Where does a $200 million movie make its money?
The biggest sweet spot of a blockbuster movie is in the video window. The cost
of manufacturing for a video is very small. Box office performance of a
blockbuster movie is going to drive sell-throughs, maybe to 10 million or 12
million units, which is significant. The theatrical on a big blockbuster is
largely a loss leader, because you spend so much money, maybe $40 million, in
P&A [prints and advertising] just in America. And let's say the picture
does a hundred million dollars in North America; half of that will come back to
the studio, so you're looking at $50 million dollars; $40 million of that goes
to exporting it with publicity and advertising and your television spots. So
basically, maybe you've got a few million dollars that comes back into
But it's all the other areas that really are the areas where companies are able
to survive. Most major companies have output deals with, like, Showtime or HBO
or Starz. And those particular windows, what they get is largely based on box
office performance. So you could pick up $10 million to $50 million just in
cable alone, depending upon the level of box office in your output. Then you've
got, on top of that, the extraordinary sweet pie of home video and DVD, which
really is the bottom line in terms of recouping and making a profit.
How much room is left for independents?
In the independent world, because you're not necessarily dealing with huge
P&A, it's much easier to sort of monitor the spends and to see where you're
ultimately going to recoup. Most companies from Sony Classics, the Lion's Gate,
are pretty accurate in terms of their reporting structure. ... I think that
there's still room in the pie for an independent company on a successful movie
to see a profit, particularly since a lot of the independent distributors have
fairly strong output deals now with the cablers and in home video.
What keeps you excited?
I'm still that five-year-old kid who really responds to the transcendent nature
of movies. I still enjoy seeing a story well told. I still go and see the big
movies and the small artistic pictures as well, because there's such variety
out there. What also keeps you going is seeing a great movie and, hopefully,
with the optimism that you, too, can be part of a great movie.
Any predictions about the future?
The future is really hard to predict because I think people will always respond
to the nature of a good story, whether it be on the face of your wristwatch or
a screen a hundred feet high. ... I can't really say how things will change
from the standpoint of delivery ... But I don't think that people will ever shy
away from an emotional communion, whether it be on television or on the big
screen with character in action who fulfills a lesson. And I don't think that
will ever change.
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