December 15, 2004

So what's really happening at Miramax?

Following a story that has no interest in being followed is, well, difficult to follow. It's not as though anything is actually is happening, yet pieces of the puzzle fall out of the box all the time.

This week, there was the mystery story by Sharon Waxman in The New York Times about Fabrizio Lombardo, which reads a little like it was edited by a swiss cheese manufacturer. Lombardo's relationship with Harvey Weinstein has been an open secret in the community for a long time. Waxman, who certainly had reported more than she could print, pushed it into the light. But the question is, what got the ball rolling downhill… who pushed it?

Reads like someone trying to lay out the groundwork for dismissal for cause against Harvey Weinstein… hmmm…

Meanwhile, Miramax mouthpiece/columnist Roger Friedman came out with an anti-Eisner story on the same say the Miramax piece, which the Weinsteins knew was coming, reviving the seven-month-old fight over Fahrenheit 9/11 and the even older separation of Stanley Gold from the Disney board.

Reads like someone trying to keep the pressure on Disney… hmmm….

Meanwhile, Disney filed with the SEC (as reported by USA Today) that projected a future for Disney without the Weinsteins at Miramax. But while the headline trumpeted that Disney was preparing to cut the Weinsteins out of Miramax, the body of the story suggested pretty clearly that Disney was living up to its fiduciary responsibility and raising the possibility, as required by law, that the Weinsteins will be severed from Miramax by third quarter of 2005.

If the SEC filing had said any different, it would have signaled a certain desperation to get a deal with the Weinsteins done... a signal Disney can't afford to send. They could get into trouble for projecting revenues based on a division they expected to shutter or slow significantly next year, but they cannot for improving projections once a Weinstein deal is done.

Reads like someone trying to make clear that they are willing to go on without the Weinsteins… hmmm….

Meanwhile, Roger Friedman, in one of his now daily free ads for The Aviator writes, "Imagine what life will be like for Disney next year when it gets no Golden Globe nominations at all. By then, Michael Eisner will have forced out the Weinsteins and reduced Miramax to a library imprint. Pixar has already said it's holding its next release, Cars, until 2006.

How will the Disney board explain to the company's shareholders at their annual meeting in March 2005 that a motion-picture company has no possibility of participating in the next round of awards ceremonies?"

Reads to me like someone trying to create another argument about why Disney needs the Weinsteins… hmmm…

Of course, we keep on hearing about cutbacks at Miramax… cell phones bills and expense accounts being eliminated… a lack of much production activity…

But didn't Miramax just get a $700 million check on October 1 to be expended over the next now-ten months? Why aren't the Weinsteins throwing away Disney's money like drunken sailors if they are headed out the door anyway? Why aren't they doing every favor project they can while it is still on someone else's dime? If they are leaving, why are they being more fiscally conservative than ever before?

This is my theory…

One person close to the renewal deal that Miramax last did with Disney has suggested that there is a significant bonus due the the Weinsteins in the contract if they re-up with the company again… golden handcuffs. It is very likely that there are other bonus structures set up in the contract of which the Weinsteins would like to take full advantage.

That, combined with the control of the company library, not to mention the family name, seems like a lot for the brothers to walk away from. Add to that the very real concern about them starting a new company from scratch, which is not quite as easy as everyone seems to want to make it sound, and there is little logic in the Weinsteins walking away.

There was enormous pressure this summer to get a deal done before the October 1 new fiscal year. But now, the negotiating pressure is off. There is no deadline close enough to draw sweat on the brow of the other side. So I expect that the Weinsteins will lie in wait until June or so before really going to war in the negotiations.

What we heard a lot about in the summer was that Disney's offer to maintain a Bob Weinstein-run Dimension was insultingly low. That description is, obviously, subjective. But my guess is that something in the $200 million to $250 million range, including marketing money, was on the table. Dimension generated $290 million at the domestic box office in 2003, the division's biggest year. Thanks to low costs, that made the division extremely profitable.

The question then is, how much does Disney want to spend on Harvey's side of the business… and, realistically, that is where the real chafing begins. Miramax generated about $120 million more than Dimension in 2003, but sure ate up a larger percentage of the $700 million annual budget… a lot less profitable, if not in the red.

Disney has made it clear that it is not interested in a $700 million Dimension/Miramax. So how low is it low-balling the brothers? I would guess that the proposed annual figure is under $500 million - which would still make Miramax three times better funded than any other Dependent studio.

So I keep getting the spider-sense that Mr. Weinstein's public growling is mostly about getting Disney to up their number. The problem for him is that the lack of a fiscal-year-end deadline combined with a sudden upturn in the fortunes of Disney, combined with the promise of a new CEO at the company sometime this summer, took the steam away from not only Weinstein but dissidents Gold & Roy Disney as well.

Meanwhile, Disney is playing it cool. There have been rumors that people have been in discussions to take over the reins at a post-Weinstein Miramax. They seem to be nothing more than casual. But again, those rumors are little signals.

But the Fabrizio Lombardo story is truly fascinating. Miramax suing to recover money from its own. Disney says it has no idea what's going on.

And where is the $400 million of the $700 million annual budget going to go if not to production and distribution of new films? Could it be that Miramax spent more than $700 million last year and needs to catch up to its bookkeeping before potentially closing the door… or even not closing the door?

I suspect that we will continue to hear mostly about the ongoing "amicable discussion" for the next few months. Oh, how fascinating it will be when we learn what really lies beneath.

READER OF THE DAY: Y-JACK writes: "Dave, you're a fine, fine writer, and reading your column is one of the first things I do after I brush the crumbs from my eyes in the morning.

Your commentaries are often razor-sharp, with deconstructions of
deconstructions and smarty-pants flippancy raging forth on a tsunami of
undeniable savvy. But I'm amazed that you can write a piece (in this case
slamming the already underrated "Spanglish") concerned with a writer's
crippling subjectivity without realizing that you yourself are a flagrant
devotee of just this sort of unrelatable thought and writing. Your
declarative, definitive pieces often seem like they're written from some
objective point of view that contains the only available truth on a given
industry topic - but what happened to "Enduring Love"? And why have you stopped mentioning "Phantom Of The Opera" as a front-runner for Oscars? (I'm still jazzed to see that one) I've seen "The Aviator" now, and the film I saw bears no relation whatsoever to the picture you were so lukewarm on. Which would be fine, if you weren't attempting (on a day-to-day basis) to convince the world that EVERYONE feels that way you do about "Aviator" - what's with all the accolades, then?

When you're right, we can only appreciate with awe. But when you're wrong, MAN, you're really, really wrong - and that inspires a different kind of awe.

I don't think audiences will have any trouble at all relating to "Spanglish," which is not "another failure" but yet another mainstream artistic success for Brooks - the best living screenwriter, and a genuine poet of human frailty and foibles. But I don' t say this because I myself am a fan of the film (that would be a subjective an opinion as your own, and you would call me on it), but because the screening I saw was a raging success. Everyone in the six-member party I saw the film with loved it, including a roommate who is famous around my place for their inability to sustain disbelief for even a moment (let alone 120 minutes) while watching a movie. And yet nobody complained about Paz Vega being too pretty a maid, or about Adam Sandler (a terrific, subtle performance, by far the best thing he's ever done) not having any Spanish-speaking chefs, or (in general) about Brooks having written too insular a story. "Spanglish" is about parenthood, about class and culture struggle, and about personal reponsibility. (I also wanted to fit in there somewhere that I'm e-mail buddies with a major national film critic, and he told me that he and everyone else HE saw it with also loved the picture)

I think the critical establishment often approaches the work of an intellectually comporable filmmaker like a gunslinger approaching another in the road for a duel. "You're smart, but I'm smarter!"

It's like you grab the dish out of my hand before I can eat it, ruffle through it with your long fingers, and decide I wouldn't like it, before tossing it out the window. With a movie like "Closer" (my favorite film this year, Dave - this one is not gonna fade with time), it's the smart film critic trying to out the filmmaker for his superiority. With "Spanglish" it's the smart critic trying to out the smart filmmaker for his insulation. (Meanwhile, nobody is nailing the critic publically!) Trouble is, neither of these reactions can possibly be relatable to how a general audience is going to feel. The general audience is not threatened by a filmmaker with brains and a point, they don't see a movie like "Closer" as a thrown-down gauntlet - a challenge to a right-thinking world view. "Closer" and "Spanglish" both show us actual humanity - maybe not our situation, but certainly an imaginable one.

I think you and your kind may have murdered "Spanglish" in it's bed already. But it was some kind of crazy crime of passion (I won't bring up thwarted artistic ambition on the critical establishment's part, as that's a cliche - but I just brought it up, didn't I?) - "Spanglish" is simply not the movie you're describing.

E-ME: Well... I am waiting to see a movie that audiences love that critics can "kill in its bed." Not that I want that... but it is not the way it works. Spanglish will come out this Friday on thousands of screens with tens of millions of dollars in the quality ad support that launched Spider-Man and Something's Gotta Give and As Good As It Gets.

I have no problem with your subjectivity. And I fully acknowledge my own. I don't feel any need to compete with Jim Brooks. He wins, hands down. After Scorsese and Coppola, he is the filmmaker whose films I most often quote.

For the record, I still think that Phantom has a shot, though Million Dollar Baby will, I think, overwhelm the room. My opinion of Enduring Love hasn't changed... but it was always my opinion. And I have never suggested once that my opinon of The Aviator matches anyone else... I think I have written repeatedly that I am somewhere in the middle, between the bashers (who do exist) and the lovers, who are louder right now.

I am happy for people to love this film. If they do flock to it, I will be surprised. (Opening weekend, as always, has nothing to do with the film's quality, but the quality of marketing.) Sometimes something feels so inside to me that it is outside.

But, like Jim Brooks, I rely on people to make up their own minds about my ideas. You saw the movie and felt intensely different than I did. Cool. I did my job... and you did yours.