It's like 'Transformers' in reverse: There's less biz than meets the eye

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Our upbeat headlines often obscure underlying unease.

Yes, Ryan Seacrest is probably going to make close to $10 million in his upcoming deal with the producers of "American Idol," helmer Michael Bay can revel in mega-millions from the worldwide ka-ching of "Transformers: Revenge of the Fallen" and "CSI" creator Anthony Zuiker pretty much wrote his own check last week in his renewal deal at CBS.

Meanwhile, Tom and Brad and Angelina and Jennifer have nothing to worry about in their old age.

But these are the happy few in a rarefied firmament that is shrinking rapidly.

It's certainly more fun to write about mega-buck deals being closed than to tease out the steep discounts most talent is being hired for to do whatever in film and TV.

Plus, it's hard to get talent (or their agents) to go on the record as being the guy or gal thrilled to be making half what they would have received two years ago.

To be sure, studios have been trying to tinker with the star system since it was invented, and of late they've happened onto formulas that kind of do the job for them: Who needs stars anyway when robots and cyborgs have taken over the big screen? Facebook, Monopoly and just this past week View-Master -- not human characters interacting with one another -- are reckoned as enticing subject matter as literary works were in decades past.

But even the bullish boxoffice we've been enjoying from the clash of inanimate objects is a misleading leading indicator.

Such tentpoles as "Transformers" and "Star Trek," as well as Pixar/Disney's "Up" and the surprise hit "The Hangover," have powered grosses both domestic and foreign to clock in 5%-10% ahead of last year and have flummoxed folks nationwide.

But a few of the bets being placed by studios have not lived up to expectations, including star vehicles for Will Ferrell ("Land of the Lost"), Johnny Depp ("Public Enemies") and Eddie Murphy ("Imagine That").

Then there's the unthinkable: What if James Cameron's $300 million "Avatar" were to flop? It would be like General Motors or AIG a year ago: too big to fail. Hopefully, marketing and promotion are too foolproof for such a scenario.

Certainly the rest of the country is even worse off, and there's a lot amiss in Tinseltown, too.

"How are they all coping? They're polarizing their choices," a producer and former studio exec told me last week. MGM, he said, began doing this years ago, spending big time on James Bond tentpoles and making everything else low-budget.

Now, almost all the majors follow a similar strategy: a tilt toward a handful of tentpoles -- meaning, essentially, effects-laden popcorn movies based on comic books or other franchises designed for teenage tastes that eat up most of the production budgets -- plus a few gross-out comedies or horror pics, a chick flick, a prestige pic or two, and that's it.

From about 650 pics a year produced in Hollywood 10 years ago, we're likely to see about 400 in 2010.

The good news is that there are still only 52 weeks in a year, and having fewer releases each Friday might work to benefit the three or four major releases each weekend that appeal to different audiences, rather than having hugely expensive tentpoles clash with each other on the same opening day. A leaner release schedule might even help an indie pic with otherwise little P&A break through the clutter.

The bad news is that a noticeable swath of the off-balance-sheet financing on which studios (and key indies) have become dependent to mitigate their risk has dried up. The Economist magazine said only 10-12 banks are investing in Hollywood film slates, where as many as 30 did so before the credit crunch.

Private-equity and hedge funds have their own sets of problems in other sectors of the economy they're mired in, but they too might not want to stick around entertainment any longer than they have to.

Beyond the always-tricky theatrical performance, it's getting harder to get the tail to wag the dog in that ancillaries aren't panning out to be as lucrative as they once were.

All that wouldn't be so bad if things were better in other parts of the conglomerates' empires.

But broadcasting (not to mention theme parks, electronics, outdoor, local radio and TV station groups) is hardly a barrel of laughs. I can't remember the last time the upfront advertising market for fall primetime dragged on so long. As it closes out, networks likely will see decreases of 5%-10% compared with last year, which itself wasn't particularly exuberant.

With credit-card defaults likely to be the next domino to fall in the ongoing recession game, it's doubtful consumer spending or the overall advertising market will pick up in the near term.

There are going to be a lot more robots hitting the screens before this is over.
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