Desi Train

Sumner Redstone, the 83 year old chairman of Viacom - that owns the Hollywood company Paramount Studios, started a war of the “starry” worlds recently by breaking away from the golden-boy-gone bad.

You see Paramount Studios was in partnership with Tom Cruise’s (yes The Tom Cruise) film production company. The partnership lasted for 14 years. The terms of the partnership, roughly were this:

- Paramount payed $10million each year to Cruise’s company as a “retainer” fee.

- Paramount in addition payed roughly around $6million to Cruise’s company each year as a discretionary fund to “develop ideas” (Is anyone from Parmount even visiting Desitrain.com???)

- For every movie, jointly produced by Cruise and Paramout, Tom Cruise would get 20 percent of whatever the movie made at the box office. - This meant that if a movie was made for $100million and ended by having a gross sales of say $60million at the box office (a $40million dollar loss), Tom Cruise would still get a neat earnings of $12million inspite of the movie suffering a huge loss.

DVD Market is on the down. Big budget movies aren’t faring well this year. The only profit making ventures have been small budget movies like Saw2.

So Redstone took the decision, but the manner in which he made the decision to cut off business relations with Cruise has split the Hollywood industry into two, when he announced that Paramount would break its 14-year relationship with Cruise’s film production company because the star’s “recent conduct” - which he branded “creative suicide” - had been “not been acceptable” to Paramount.

One of the most interesting articles on this incident is by Chris Ayres who filed this report at The Australian News. The report comes out as very balanced and provides indepth poking at both ends. For example Ayres starts by finding who Redstone is and his reasons for severing ties with Cruise’s company

Redstone, who was a code breaker for the Americans during World War II and once suffered burns to 50 per cent of his body in a Boston hotel fire, was clearly not intimidated by Cruise, in spite of the actor’s status as the fourth most bankable star in history (his films have made a total of $US2.7billion ($3.5billion) in American box-office ticket sales alone) and as an operating thetan level seven in the Church of Scientology. “As much as we like him personally,” deadpanned the Viacom boss, “we thought it was wrong to renew his deal. His recent conduct has not been acceptable to Paramount.”

There must have been something drastic happening on the financial end at all Movie studios for them to turn their back on the World’s all time fourth bankable star. But according to Ayers many in Hollywood were expecting this

Paramount’s dumping of Cruise didn’t come as a surprise to everyone. According to Hollywood insiders, a celebrity apocalypse of this magnitude has been a long time coming and would have happened even if Cruise hadn’t used Oprah Winfrey’s sofa as a trampoline, lost his temper during an interview about Brooke Shields’s medication, or fathered the baby of Katie Holmes. Directors, producers and screenwriters alike say that actors have become so grotesquely overpaid in relation to the profitability of modern films that something radical had to be done. How, they ask, could Cruise expect to keep his Paramount retainer of up to $US10million a year - to cover overheads such as office rent, jet fuel and salaries for his most trusted aides - at a time when studios can barely cover their marketing bills? (In sharp contrast to Cruise’s production deal with Paramount, Brad Pitt’s company, Plan B, reportedly gets only $US2million a year from the same studio, with a $US500,000 discretionary fund to develop ideas. Cruise’s discretionary fund was about 12 times that size.)

Advertisement

The Redstone-Cruise war shows a new trend emerging in Hollywood. Studios trying to smash the worshipped glass idol called the “Star System”. And it has been brewing around for quite a few months. According to Ayers

The bad feeling between studios and actors has been building all northern summer as panic over invisible profit margins continues to take hold. In June, Paramount halted the production of Believe It or Not, a Jim Carrey project with a budget of $US150million. Then came a leaked memo from Morgan Creek Productions to Lindsay Lohan, the hard-partying actor who was starring in a film called Georgia Rule. “To date your actions have been discourteous, irresponsible and unprofessional,” said the missive. “You have acted like a spoilt child.” Days later, Walt Disney cancelled a Mel Gibson television miniseries after a transcript of the actor’s drunken rant against Jews was published online.

Are studios opening up to the fact that an actor’s offscreen reputation affects box-office ticket sales? (Salman Khan should be very afraid had this been Bollywood)

But it’s a Catch 22, as Ayers explains here:

The problem is not so much actors’ fees - although these can still reach $US20million - but so-called first-dollar revenue-sharing agreements. Cruise was the undisputed king of the first-dollar agreement, hence his spectacular $US70million payday for Mission: Impossible II. Put simply, it means the actor takes their cut from the gross box-office receipts of a film before the studio deducts any of its overheads. In Cruise’s case, his Paramount deal gave him a box-office share of about 20per cent. This meant he could get rich from a film that actually lost money for Paramount. The problem was summed up by Nina Jacobson, Disney’s production chief, in an interview with the Los Angeles Times: “You can find yourself, under a traditional first-dollar deal, writing huge cheques while you are bleeding. It doesn’t seem fair.”

If times were good in the movie industry, all this might not be such an issue. But costs have risen so much faster than revenues over recent years - Variety recently pointed out that it took 90 years for Hollywood to produce its first $US100million film, and less than a decade after that for budgets to more than double again - that some kind of reckoning was inevitable. Said one Los Angeles film executive, who has worked with the likes of Martin Scorsese (he too did not want to be named), “There have to be some adjustments in the system, otherwise no one’s going to make any money: not the producers, not the agents, not any of the people who surround these A-listers.” The executive pointed out, however, that stars can typically demand such high prices because, without them, financial institutions will not put up any funding: “Take The Da Vinci Code. Could it have been a monster hit without Tom Hanks? Sure. But could it have been financed without Tom Hanks? Not so sure.” The economics of movie megastardom, however, finally appear to have reached their tipping point: the slightest transgression by an actor now justifies a public dressing-down or, better, a Cruise-like dismissal. The only consistently profitable films in Hollywood these days are tiny-budget, no-star horror flicks such as Saw II, which cost $US4million to make and has taken $US144million globally, with essentially no marketing budget.

One of the final straws to many studio chiefs was news that Superman would have to collect more than $US600million in global revenues just to break even (the budget was estimated to be $US250million, with marketing costing the same again).

So though many in Hollywood welcoming the new era which destroys the star system, some feel that the manner in which Redstone handled the entire episode could have been executed in a more diplomatic manner allowing Cruise to “save face”. Yet there are other who believe there was no need for emotional gloves to be worn by Redstone

In Malibu, at the director’s home, there was a different take on Redstone’s chastisement of Cruise for allegedly ruining the promotion of Mission: Impossible III with his erratic, Scientology-promoting behaviour (Redstone told The Wall Street Journal that Cruise had probably cost the movie $US150million in ticket sales). “I think this trend is very healthy,” the director says. “I don’t know why these very over-privileged people should be spared the criticism that ordinary people have to deal with at home or in the office. Why do they have to be treated like mental and emotional dwarfs? They’re like those losing children who get the same prize as the winning children. How can you correct your behaviour, or improve yourself, if you don’t know why everyone is so f–ing angry with you?”

For now the next two years will tell on what happens to this new era. More interestingly with the rising number of Production houses in Bollywood, will we see the same trend? But before that happens Bollywood will have to see some pretty low budget movies raking in a lot of moolah at the box office. And on the other hand the professional and personal relationships of production houses and Bollywood stars is too close (we are family) for this trend to slip in. Still in an age and industry where money is greater than God, it would be interesting to see how long this close family lasts…

Advertisement

Related posts

1. John Abraham to star opposite Rachel Weisz Now Rachel is one my most favorite actresses and...
2. Nicholas Cage in “The Sadhu” Cage-bhai will soon be in India. Reason. It’s all...
3. M I 3 : This Mission is getting Impossible After coming out from watching 2 hours of visual...
4. The highest paid Indian actor Get this. Who is the highest paid Indian actor?...
5. Chauffeur a.k.a. Driver This is lesson to teach the word Chauffeur /...
6. It’s D-WAR not Deewar you idiot Rarely does something make you sit up and take...
7. Ramujee and Khalidjee Caught a funny yet frank interview, Ram Gopal Varma...
8. Spiderman 3 reviews : Spidey baby bye bye? The initial reviews from the India press on the...
9. Ram Gopal Varma - What’s going on? What’s going on in The Factory, Ram Gopal Varma’s movie...
10. Reality Bytes: Rahul Dholakia and Anurag Kashyap Indian Express brought Rahul (Parzania) and Anurag (Black Friday)...

This entry was posted on Friday, August 25th, 2006 at 10:39 am
Filed under Movies, TV etc., News Catch
Tags : .

Views : 2,613 views
You can leave a response, or trackback from your own site.