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After the many months of courtship — the meals spent flirting with every agent who matters and every executive with even a vague hope of running some part of the Warner Bros. film studio — the rubber and the road are beginning to meet for boss of bosses David Zaslav.
Relieved as everyone was to be rid of AT&T management, the assessing of the new regime’s choices has begun. Already there has been grumbling about CNN chief Chris Licht from insiders at the cable network, many of whom are still sitting shiva for the ousted Jeff Zucker. A June 5 story in The New York Times said that a month into Licht’s tenure, “some CNN journalists” are wondering whether “he can navigate a sprawling, unwieldy global news network past what has been a no good, very bad year.”
Michael De Luca and Pam Abdy, on the other hand, are likely to be welcomed in the film community with wide-open arms. Between them they have decades of industry experience, and De Luca’s relationships with talent in particular were a selling point with Zaslav. (He has surely observed what Hollywood does to outsiders who start making pronouncements without a goodwill ambassador to guide and protect them.) De Luca’s affability helped him compete for talent and material when he was situated at MGM, a studio that wouldn’t have been top of the list for anyone with something good to sell. But the more potent lure is always money, and De Luca is known for spending it. That would appear to be very much at odds with Zaslav’s natural inclinations and, given the debt, imperative to keep a tight rein on costs.
Even some of De Luca’s friends worry how this will go. “He’s talent-friendly, he’s a passionate advocate for certain kinds of projects,” says an executive who knows him well. “Is that going to cut it in a big corporate environment?”
A veteran high-level player actually chortles when asked to prognosticate. “I love Mike. But Mike has been totally consistent in making movies that are flashy and lose a lot of money,” he says (with some hyperbole). “Zas says, ‘We’re going to make hits for less money’ and then you hire a guy who does the exact opposite.” Says another longtime insider: “The idea of fiscal responsibility and creative freedom? Someone’s head’s going to pop off.”
Certainly De Luca and Abdy spent money at MGM, though a source says they stayed within the development and production budgets they were given. Their mandate as chairman and president, respectively, was to make the drifting studio look like it was in the game to help drum up a sale. (The logic of this is unclear as the Bond franchise and the library were the real assets on the block.)
Insiders saw De Luca’s hire there then — and at Warners now — as evidence of the great persuasive powers of CAA’s Bryan Lourd. And certainly many CAA clients benefited from the deals that followed. Paul Thomas Anderson made Licorice Pizza, Lady Gaga starred in House of Gucci, Joe Wright and Peter Dinklage made Cyrano, and so on.
MGM was in the awards conversation and Licorice Pizza was the studio’s first best picture contender since Rain Man in 1988. But sources say leaders at Amazon, which acquired MGM for a rich $8.5 billion in March, were astonished at the tens of millions of losses on the slate. In fairness, the movies were released theatrically during the pandemic. But Licorice Pizza cost about $50 million and grossed a paltry $32 million. Cyrano was dead on arrival. And Amazon has a few more left in the pipeline that are expected to fare poorly.
Looking at that history, there is plenty of reason to see De Luca and Zaslav as a very odd match. “People admire Mike’s taste and they love being in business with him,” says one De Luca associate. “But people, I know, had urged them to give him something smaller, not as big a thing. This is a big thing.”
Still undefined, however, is how big is it? The number of movies and the budgets that Zaslav will approve apparently are TBD. Wherever the studio lands, it’s a strange new world for Zaslav, who even in TV is used to dealing with shows with a cost per episode that’s a fraction of a series on one of Turner’s channels.
Over the years, De Luca has zigged and zagged from executive to producer and back again. Having joined New Line at age 19 as an intern, he rose to run the label and oversaw films that defined him as a man of strong and eclectic taste: Seven, Boogie Nights, Austin Powers, Friday. In 2001, he was ousted amid a string of flops. (He still likes the Adam Sandler debacle Little Nicky.) He established a reputation as a Hollywood bad boy — public intoxication, fighting, sexcapades. The truth — and he is transparent about it — is that he has struggled intermittently with addiction. He is now four years sober.
After New Line, he did a stint as president of production at DreamWorks, but it proved to be a bad match. In 2004, he set up a producing deal at Sony Pictures. What followed, eventually, were producing credits on best picture nominees The Social Network in 2010, Moneyball in 2011 and Captain Phillips in 2013. (Scott Rudin was a producer on two of those and executive producer on the third.)
De Luca returned to an executive role at Sony in 2013, where he was co-president of production with Hannah Minghella. With studio leadership under pressure to rein in spending, Doug Belgrad, then president of the studio, wrote in a November 2014 email to his boss Amy Pascal: “I don’t think Mike actually even remembers between each moment I tell him how over budget they are, how over budget they are.” Pascal — ironically known as a particularly spendy executive herself — responded: “I want them to understand how to do the job like a grown up with plans and targets and responsibility. I keep writing the same note over and over like a crazy person.”
(When asked for comment, Pascal now says: “I have spent more than 30 years working with Mike and I can say categorically, and without hesitation, that he is one of the most talented, intelligent, creative and most fiscally responsible executives that I have ever collaborated with. To quote a few sentences that were taken completely out of context from a private email conversation is irresponsible, misleading and unfair.”)
A few months after the 2014 email, Pascal was ousted in favor of the fiscally prudent Tom Rothman and De Luca left Sony. He segued to a deal at Universal, where he was a producer on the Fifty Shades of Grey trilogy that grossed more than $1.3 billion worldwide. In January 2020, he was named chairman of MGM’s motion picture group.
Looking at that history, some who have known De Luca over the years wonder what happens next. Is Zaslav really prepared to gamble on expensive movies with the necessary marketing spend? This is all new territory for him. “He probably feels like he can control it, and he’s going to get all the positives of what Bryan [Lourd] is going to provide and he’ll be able to manage the spending,” says a former De Luca colleague.
Some wonder if De Luca and Abdy are once again doing a job they were perceived as being hired to do at MGM: Keep Warners in the game with an eye toward a sale. “How long do you think this is going to be a stand-alone company?” says one veteran executive. “I say two, three years. This company is going to be bought. … If they can make some good movies and announce some nonexistent Harry Potter stuff, that’s a win.”
This story first appeared in the June 8 issue of The Hollywood Reporter magazine. Click here to subscribe.
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