Boxoffice-July.1999

SPECIAL FEATURE: Books on Cinema
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GROSS" ANATOMY
''Variety'' Editor Peter Bart Examines the Summer of '98 in
The Gross: The Hits, The Flops— The Summer That Ate Hollywood'
While
the surface numbers
made summer '98 seem more
bountiful than previous seasons,
insiders at the studios knew otherwise.
The good news was that moviegoers
spent $2.6 billion to see the films of summer,
which was 16 percent more than in
1997, the first period of significant
growth in over five years. And though no
megahit emerged from the pack, business
was spread generously among more
movies from more studios. The range of
choice offered [to] the moviegoing public
also showed a marked improvement during
summer '98, with serious adult
movies successfully challenging the frenzied
assault of action fare.
All that was good news, but balanced
against it were some troubling realities.
At a time when nearly all sectors of
American business were successfully
keeping costs under control and inflation
had all but disappeared, the movie industry
found itself gripped by its own private
inflationary spiral. Production and marketing
costs for summer '98 sustained
double-digit increases, despite concerted
efforts to control them. Nine movies costing
over $100 million were released during
the summer, compared with six a year
earlier, and a few, like "Godzilla" and
'Armageddon," had even entered the perilous
$150 million zone. The summer also
yielded more than its share of expensive
mistakes, like "Quest for Camelot" and
"The Avengers," without huge breakout
projects to compensate for them. Indeed,
a few of those movies that seemed substantial
winners on paper were, in fact,
profitable principally to their superstar
talent. "Saving Private Ryan" and
"Lethal Weapon IV" were prize examples,
with studios giving away over 35 to
40 percent of their gross receipts to
Spielberg, Gibson, and others.
There were other numbers worries,
albeit niggling ones. The 16 percent jump
in boxoffice receipts wasn't quite what it
seemed. Admission prices had risen by
about five percent, accounting for some
of the increase. The boxoffice numbers
also for the first time included receipts
from Imax special-format theatres, which
experienced a 10 percent growth during
the year. In addition, the calendar smiled
on summer '98 with the configuration of
the Memorial Day and Labor Day weekends
adding a week to summer playing
time...
[F]or the entities charged with the
responsibility of creating, marketing, and
distributing the product, and hopefully
showing a return to their stockholders,
summer '98 had proven a major disappointment.
Permeating the executive
suites was the sense that movies were now
a lousy business, whose structure and
practices were in desperate need of overhaul.
If the men sitting atop the corporate
pyramids had distrusted the business
going into summer '98, their antipathy
was only further inflamed by the time
summer had run its course.
At
each individual studio, the
business of mobilizing new
strategies took on different
nuances as a result of the politics of the
parent company and its relative performance
during summer '98...
For Universal, summer '98 was a study
in utter exasperation...While the muchheralded
$10.4 billion acquisition of
Polygram stayed on track despite the dollar
weakening against the Dutch guilder,
Edgar [Bronfman] Jr.'s plan to deal away
Polygram's movie business for as much as
$1 billion hit the wall. There were no takers.
By early fall, it was apparent that his
best option was to split off the Polygram
film library and peddle it to the highest
bidder, which turned out to be MGM,
while retaining some of its production
units within Universal...
[T]here was no denying the studio's
utter failure in creating a summer slate,
but, again, better times lay ahead.
Releases for fall and Christmas and
beyond had looked solid on paper, buttressed
by a sequel to "Babe" called "Pig
in the City," "Patch Adams" starring
Robin Williams as a middle-aged medical
student, and "Meet Joe Black," the very
long and very expensive Brad Pitt-
Anthony Hopkins remake of "Death
Takes a Holiday" that originally was to
be the summer centerpiece of 1998...
[Universal production chief Casey]
Silver's films were in the can, and several
of them, such as "Meet Joe Black" and
the sequel to "Babe," were expensive projects
indeed, and both had run dangerously
behind schedule. Once those films
had run their course, Edgar Jr. and his
top team, including Ron Meyer, would
make their determination about
Universal's future commitment to
movies. Several key decisions already had
been handed down. In the futi
Universal would adhere to Paramou
policy of passing the hat on most of js
projects. Before the green light starj
flashing, some form of cofinanc 3
would have to be available... At the sa
time, Universal had no intention of liv
up to the pledge made by Casey Silvei
the 1997 Cannes Film Festival that
company would release as many as 30[)
35 films a year...
Universal was scaling back, that mih
was vividly apparent... By the Than
giving holidays, [Edgar Jr.'s] worst fe
were realized. "Meet Joe Black" oper
to dismal business and, despite prec
tions that it would soon find its audien
that following never materialized. Afc
stressful delays owing to problems wi
special effects, an eleventh-hour tt
screening of "Babe" was similarly alar
ing. For many children, the movie seerr l\
too dark, and there was little time ij
modify the film if the release dates wi H
to be met. While the "mix" was tori
down to reduce the shrill music and hai i
sound effects, the word somehow hb
gotten out that "Babe" was not as appe <
ing as such competitive films t
"Rugrats" and "A Bug's Life." By the e
of the five-day Thanksgiving weeker,;
the numbers told a grim story. "Bahl^
had grossed $8.5 million compared w
$46.5 million for "Bug's Life" and $2'i
million for "Rugrats." As for "Meet Jt
Black," after 17 days it still had banedged
past $35.8 million.
Insiders were not surprised when t
golden parachutes started opening
around Universal City. Frank Bioni
Bronfman's chief at Universal, was
with a $30 million settlement. And sho
ly thereafter Casey Silver also was hist
ry, with a lavish production deal. It woi
now be up to Ron Meyer, the ex-agent,
reinvent Universal in [consistency] wi
the new corporate strategy, the details
which still remained vague.
At Sony, the post-summer reasse;
ment was equally opaque. This was t
summer that was to establish Jol
Galley's regime as Sony's new drivii
force. Once considered too elitist for
post like this, Calley had chosen to ent
the fray armed not just with a solid
commercial — project, but with a fra
chise "Godzilla." As summer movi
along, however, he became exasperat«
by the chorus from the press and W;
26 BOXOFFICE