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Ask any Hollywood studio executive whether 2005 was a good year and you'll get an emphatic no. That's because the major studios are under severe duress and they know it. MGM was sold to a consortium lead by Sony Pictures Entertainment. And well-paid studio execs are scrambling to preserve the status quo even as boxoffice and DVD profits are on the wane and new digital distribution paradigms challenge current ways of doing business.

As ever, just when Hollywood thinks it has figured out the winning formula -- build costly tentpoles and cram them down the throats of the masses with millions of ad dollars -- it's way past time to come up with a new approach. The studios don't have a simple solution for what's happening. The summer slump was supposed to be counteracted by the year-end studio juggernauts "Harry Potter and the Goblet of Fire" and Peter Jackson's "King Kong." But 2005 boxoffice still declined from that of 2004 by more than 5%.

The pictures this year weren't any worse than usual. They met the studio standard -- such as it is. But they weren't good enough to fight the competition, especially for the attention of young men, from the likes of "Monday Night Football," "Halo," iTunes, Comcast On Demand, "EverQuest," Gizmodo, ESPN, AOL, HBO, Yahoo!, Bravo, HDNet, CinemaNow, PokerRoom and MySpace. And greedy theater chains didn't help their efforts to lure filmgoers out of the house by adding assaultive ads to their movie preshows.

For better or for worse, here are the entertainment industry players who made an impact this year:

Steve Jobs and Robert Iger: After years of anticipating the digital future, it finally arrived. In October, Apple and Disney threw open the digital distribution portal with day-after downloads via iTunes of such primetime programs as ABC's "Desperate Housewives" and "Lost." The instant success of the radical move had a domino effect, as other companies jumped on the download bandwagon. New-kid-on-the-studio-block Iger has emerged as the studio leader most likely to lead the charge into the radical revolution that will continue to rock Hollywood during the next decade. The video iPod and iTunes are the first vital link in a new distribution paradigm that will lead to the inevitable next step: higher-quality movie downloads. Iger's TV background (as well as the lure of a new Pixar deal) seems to have made it easier for him to risk angering movie exhibitors and TV affiliates alike as he experiments with alternative distribution models.

Steven Soderbergh and George Clooney: Just as the director-star producing team were reaching the end of their Section Eight deal at Warner Bros. Pictures, they finally earned kudos for showing that it is possible to balance such big-budget studio pictures as "Ocean's Eleven" and "Oceans Twelve" with risky but accessible indie films like Clooney's second directing effort, the $8 million black-and-white drama "Good Night, and Good Luck," starring David Strathairn as newsman hero Edward R. Murrow. The team also produced Steve Gaghan's provocative Mideast terrorist thriller "Syriana," starring Clooney as a middle-aged CIA operative, as well as Soderbergh's post-World War II mystery "The Good German," also starring Clooney, due in 2006. "I felt that we were sticking our necks out," Clooney says, "but these films were not designed to make money. You've got to stick with your convictions, do what you want to do and hope that it strikes a chord."

Mark Cuban and Todd Wagner: The rebel moguls behind 2929 Entertainment cleverly enlisted Soderbergh in their cause to show the slow-moving studios what the new distribution paradigm might look like. This January, they will put their radical notions to the test when they launch Soderbergh's mini-budgeted digital mystery "Bubble" day-and-date on their Landmark Theatre screens, their new DVD label and their cable channel, HDNet.

Alan Horn and Jeff Robinov: Warners studio chief Horn and his production head managed to stay ahead of the studio pack by maintaining a consistent quality for their movies, artfully managing their franchises -- Chris Nolan reinvigorated the Dark Knight with Christian Bale in "Batman Begins" ($205.3 million) and Mike Newell's "Harry Potter and the Goblet of Fire" scored well over the holidays. They kept even their remakes slightly off-center, from "Charlie and the Chocolate Factory" ($206.4 million) to "The Dukes of Hazzard" ($80 million). 2006 promises at least two probable (if prohibitively budgeted) blockbusters: Wolfgang Petersen's ocean-liner disaster remake "Poseidon" and Bryan Singer's "Superman Returns," which popped at Comic-Con.

James Schamus and David Linde: As movies like Warner Independent Pictures' "The March of the Penguins" gross more than $77 million, the studios are starting to realize that economic momentum might be swinging toward their smaller specialty film labels. NBC Universal's Focus Features, for example, had a dreamy 2005, winding up the year with not one but three viable Oscar contenders. How did that happen? First, the company is headed by a screenwriter, Schamus, who is also a veteran independent producer. His co-president, Linde, knows how to sell and distribute movies both domestically and internationally. Focus had three quality movies, impeccably released, that struck a chord with both audiences and critics all over the world: Ang Lee's "Brokeback Mountain," starring Heath Ledger and Jake Gyllenhaal as closeted gay cowboys in love; "The Constant Gardener," from "City of God" director Fernando Meirelles, starring Ralph Fiennes and Rachel Weisz; and Working Title's fresh adaptation of Jane Austen's classic "Pride & Prejudice," starring it girl Keira Knightley. Although Focus is autonomous, the enthusiastic backing of Universal chief Stacey Snider is one key to their success.

Orlando Bloom and Heath Ledger: Young hunk Bloom might want to use the more experienced Ledger as a role model for how to recover from his current career stumble with "Kingdom of Heaven" ($47.4 million) and "Elizabethtown" ($26.8 million). Ledger has made it clear that by taking the role of the repressed, laconic cowboy in "Brokeback" -- which could win him his first Oscar -- he was letting go of all the studio movies he had suffered through, from "A Knight's Tale" and "The Four Feathers" to "10 Things I Hate About You." 2005 saw Ledger stretch his inner character actor in "The Brothers Grimm" and "Lords of Dogtown" as well as carry off the swashbuckling lead in "Casanova." It's time for Bloom to follow his lead, step away from studio offers and tread the indie boards instead.

Tom Cruise and Russell Crowe: In the summer, both talented stars got caught in the cross hairs of today's celebrity-obsessed media culture. It was sad to witness because each man's carefully constructed star persona was demolished by one reckless act. Cruise jumped on Oprah's sofa, to demonstrate to one and all that he was a heterosexual in love. And Crowe, bewitched by late-night demons in his New York hotel as his summer movie "Cinderella Man" failed to open, assaulted a hapless hotel employee with a telephone. Neither man will easily recover from the endless repetition of their misdeeds on television, in print and, most ceaselessly, on the Internet. Fortunately, Cruise and Steven Spielberg's "War of the Worlds" survived the onslaught ($234.3 million). "Cinderella Man" and its Oscar hopes did not ($61.6 million). With "Mission: Impossible 3" coming up this summer, Cruise wisely replaced his sister with PR veteran Paul Bloch. For his part, Crowe can look forward to his second Ridley Scott movie, "A Good Year," as well as some serious PR repair.

Angelina Jolie and Brad Pitt: By playing their celebrity romance close to the vest, these two movie stars expertly rode their celebrity momentum to a huge hit movie, "Mr. & Mrs. Smith" ($186.3 million), and enhanced career mojo for 2006. Jolie co-stars with Matt Damon in Robert De Niro's CIA thriller "The Good Shepherd," while Pitt is married to Cate Blanchett in Alejandro Inarritu's "Babel" and plays the Western outlaw in "The Assassination of Jesse James by the Coward Robert Ford." Both stars are equally adept at playing today's celebrity game: dodge the paparazzi, distract naysayers with good charity work, and keep 'em guessing by playing wildly different movie roles.

Michael Lynton and Amy Pascal: The dual studio heads at Sony Pictures Entertainment were the poster children for studios gone wrong in 2005, as the over-priced action flicks "Stealth," "XXX: State of the Union" and "Zathura" failed to ignite at the boxoffice, along with the overwrought $85 million art film "Memoirs of a Geisha," which should have been made at a Focus Features level, and the misfire remake "Bewitched." Predictably, the beleaguered studio heads did what most of their colleagues do under such circumstances: they replaced their head of marketing. Luckily, Ron Howard's summer 2006 entry "The Da Vinci Code," starring Tom Hanks, looks like a surefire winner.

Steven Spielberg and Peter Jackson: You have to hand it to the directors who have earned the right to aim for the fences. Neither Spielberg, with "Munich," nor Jackson, with his remake of the 1933 classic "King Kong," settled for an easy win. Spielberg could not have taken on a more complex or thorny subject, terrorism in the Middle East, one that was sure to not to win him any friends but which just might influence some people. "Munich" was a treacherous tightrope: make the movie too entertaining, and it would be deemed frivolous and exploitative. Make it too polemic, and it would be called propaganda. Instead, Spielberg and his filmmaking team delivered a mature, carefully calibrated moral drama. Will it score big-time at the boxoffice? Not likely. But that wasn't the point.

As for Jackson, any studio would have handed the director the moon to get his follow-up to the astoundingly successful Oscar-winning "Lord of the Rings" trilogy. What Universal had was a property that he couldn't refuse: "King Kong." So Jackson indulged his whims on the far side of the world with a three-hour effects extravaganza that cost upward of $207 million. What was the studio going to do? Tell him to cut it? Yes, it would be great to see what the whittled down perfect version of "King Kong" would look like. But even with its bloated running time, Jackson delivered more passionate, exhilarating filmmaking than most directors can hope to create in a lifetime. George Lucas take note: Having scored the No. 1 movie of 2005, "Star Wars: Episode III -- Revenge of the Sith" ($380 million), now's your chance to do what you've always said you wanted: go indie.

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Reader comments

Couldn't help but note that you are one of the ones that seem to keep repeating the mistakes of Tom Cruise and Russell Crowe. I guess you enjoy rubbing their noses in those fact. It must be great to know you have such knowledge about these men that you can predict what will happen to them in the future.

-- Elizabeth

Interesting views. However, you seem to be saying that it was Crowe who sustained the most damage, rather than Cruise. I have to respectfully disagree with that assessment. At year end we have Crowe being nominated for SAG awards and Globes. The movie is enjoying a rebirth on video.

As for Cruise, on the other hand, all eyes are on his religious beliefs and his girlfriend's pregnancy. Not his work.

I think comparing the boxoffice of "War of the Worlds" and "Cinderella Man" as some sort of indication that Cruise weathered the storm better than Crowe is fundamentally unsound. ["War"] is a genuine blockbuster and "Cinderella Man" never was. "Cinderella Man" was clearly released at the wrong time ... whereas there was never GOING to be a better time to release "War of the Worlds." And it's "Cinderella Man" that is remembered .... and "War of the Worlds" is just another moderately successful summer movie.

I also think you have allowed your imagination to run riot just a tad in your description of events that led to Crowe's 'barney' with the clerk.

I think its way too much of a leap to make out it was sparked by any angst over boxoffice. Crowe, unlike Cruise, is first and foremost an actor ... rather than a movie star. To him I am sure it's about doing his best work and producing a movie he's proud of. Do that and eventually it will stand the test of time and win through. Otherwise he could have coined big bucks, big opening numbers, etc. by making "Gladiator 2" or any of the other epics he's been chased for in the last few years.

The phone row was, if anything, sparked by the fact [that] Crowe had been back and forth across the Atlantic within the space of a day in order to support one of the boxers who helped him get fit for "Cinderella Man" at a World Championship defense in Manchester, England. He admits he was very jet-lagged … and the frustration of continually being unable to phone home just got to him when he was cranky anyway. It's my view it would have happened the same way even if "Cinderella Man" had had double its opening BO.

Cruise … well his image as Mister Cool and in control has gone for good. The couch episode was totally at odds with his persona and that is what freaked a lot of viewers out. Crowe's phone incident … well is it THAT much of a surprise? He's known to be a rough diamond and a bit of a larrikin. The nearest person he had to a mentor was Richard Harris for heaven's sake. It seems to me that the real sin in PR terms is to do something that flies in the face of your public image.

Crowe didn't do that … Cruise most definitely did.

-- J.M.

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Anne Thompson can be reached at athompson@hollywoodreporter.com.