Miércoles 21 de Noviembre de 2007, Ip nº 217

Movies blockbusted by stars' demands
Por Ben Hoyle

But a reckoning may be looming. Research suggests the demands made by A-list actors have turned the movie business into a loss-making industry at the precise moment it has mislaid its audience at the box office.

A report, Do Movies Make Money?, predicts the 132 films distributed by the six leading Hollywood studios in 2006 will make a pretax loss of $US1.9billion ($2.1 billion).

The findings by Global Media Intelligence, an offshoot of the London-based research company Screen Digest, are based on evidence that revenue growth has stalled after a "golden age" between 2000 and 2004, while costs have ballooned.

GMI believes several of the biggest box office hits of last year made an overall loss or failed to return significant profits to their investors.

These include Mission: Impossible III, Superman Returns, Dreamgirls and Miami Vice.

Falling DVD sales, increasingly ambitious marketing campaigns and demand for ever more spectacular special effects have all played supporting roles.

The leading culprit, however, is the spiralling costs of "gross participation" deals, which can account for up to $US100 million on a single film.

Report author Roger Smith, an industry veteran of more than 30 years, said deals offering top actors, directors and producers a share of the gross revenue from a film have been rising steadily in recent years.

Those deals are not included in budgets and are paid on top of the star's official salary. GMI estimates they cost Hollywood at least $US3 billion last year. That sum dwarfs the $US121.3 million paid out in residuals to writers, the payments which are at the centre of the screenwriters' strike called by the Writers Guild of America last week.

According to Mr Smith, stars such as Tom Cruise or Tom Hanks are typically guaranteed $US20 million for a role but are also entitled to 20 per cent of the studio's slice of the worldwide gross, which can be up to $US500 million on a global hit such as Pirates of the Caribbean: At World's End.

GMI calculated Cruise made $US95 million from Mission: Impossible III, which he starred in and produced. The film took just under $US400 million at the global box office.

Paramount, the studio that had invested an estimated $US150 million in the film, "maybe got $US10 million as its share", Mr Smith said. The studio dumped its most high-profile star soon afterwards, ending a 14-year relationship.

Investing in films has always been a gamble, with studios traditionally relying on big hits to cover the losses on the rest of their slate. Participation deals are biting by sucking the profitability out of the hits, Mr Smith said.

"They make anything short of a wild hit not that profitable."

The details of individual packages are generally kept secret but Disney, the one studio that does declare the amount it pays out in participations and residuals, spent $US554 million on them last year, nearly four times more than in 2002.

At the same time, the link between star power and box office success is becoming less reliable. Peter Bart, the editor of industry newspaper Variety, wrote last month: "Here's the new benchmark for predicting box office performance: if a movie star heads the cast, downgrade the forecasts. While movie stars today can help open a picture, they sure as hell can't guarantee success. Some distributors inevitably ask, has the basic concept of a movie star become something of an anachronism?"

He listed Clooney, Ben Stiller, Jodie Foster, Halle Berry, Brad Pitt, Mark Wahlberg, Joaquin Phoenix, Jude Law and Jamie Foxx as A-listers whose recent films have "either underperformed or tanked".

Of the 15 most successful films at the US box office this year, only three were traditional star vehicles: The Bourne Ultimatum with Matt Damon, Live Free or Die Hard with Bruce Willis and Wild Hogs with John Travolta.

  15/11/2007. The Australian.