REFLECTIONS ON A NEW YEAR

Looking back at last year's morning after New Year's column, I have to say… blah blah blah.

I could write the same column today… everything is still relevant. But bigger fish are on the grill and it is truly remarkable to me how this town just seems not to have even noticed.

I don't have anything against Brad Grey. Maybe he will be remembered as the guy who started the next great era of movies, the Robert Evans of his generation. I have always said that the job is the most important part of being given respect in the film business. But this much is true… Brad Grey is not a movie guy. He is a TV guy. And he's not taking Jon Dolgen's old spot, as the guy who handles the cash flow. He's in the creative chair.

Go to IMDb and all of a sudden, there are a load of Brad Grey movie credits on the top of his page. Are those entries meant to convince Hollywood that he is now a movie guy? Are we supposed to think that he was a creative force behind the expected hit Charlie & The Chocolate Factory because he has some sort of deal with Johnny Depp that will (or would have) extend(ed) on to Graham King's Depp project, Shantaram? And I guess he's fortunate that The Sopranos is almost over and that everything else but Bill Maher's occasional HBO show is not on anyone's future schedule.

I'm not going to degrade his credit list, as some have. He didn't really produce What Planet Are You From? or View From The Top any more than he was a key creative force on The Sopranos or Scary Movie. He is a talent manager. The question is, will he be the next Jonathan Krane or the next Lew Wasserman?

I don't know and either does anyone else. We could be writing his studio head obit this time next year or we could see Paramount become the great synergistic company that Tom Freston clearly wants it to be. There will be more MTV and Nickelodeon movies, that's for sure. The rumor mill is back on the Bob Berney/Newmarket trail for the studio's art house division, though that story had cooled for a while.

Will Paramount become the home of the hip filmmaker, as it was under pre-coke Evans? Or will they figure out how to make the best SpongeBob movie ever?

The other major thing that a Brad Grey hire brings into play is the idea that anyone can run the creative side of a studio. There are many who like to mock Chris McGurk's creative ambitions behind his back. But if Brad Grey can run a studio, McGurk, it has to be said, is a lot more qualified on paper than he is.

Speaking of McGurk, the long, slow sell-off of MGM finally happened this fall and is expected to take effect late this spring. Many MGMers have already been let go, but the non-contract players will soon be out there looking for work.

Likewise, expect massive turnover at Paramount. The ongoing rumors about Donald DeLine had no basis except for the interest staffers had of keeping their jobs. He'll segue back into producing. And Grey will be interviewing for a new head of production. More rumors to come.

DreamWorks folks continue to insist that all is as normal at the campus, but logic simply suggests otherwise. The thing is, Steven Spielberg was able to put four or five films a year out under Amblin. And there is no reason to imagine that the same won't happen with a similar sized DreamWorks unit. But eventually, the overhead will have to be reduced further. There's just no upside to as large a group as currently exists. Apparently, DW Animation will continue to share marketing and publicity people with DreamWorks. But the rest will be sliced.

Speculation continues on a Weinstein departure from Disney… but I think we are a long, long way from really knowing what's happening there. Word is beginning to squeeze out - albeit inaccurately and serving the interests of the Weinsteins - that they want to get the big payoff at the end of the contract that they signed all those years ago. But as described to me, the payoff comes only with a renewal of the contract. "Golden handcuffs" was the phrase.

Personally, my take on the whole thing would be that Disney should - and this is where Eisner's exit might mean something - keep the Miramax cap and let them bring in additional outside money for projects over $30 million or $40 million. Sure, something will hit and Disney will look silly. But given Miramax's track record on the high cost films, Disney would be the winner in that deal, long term. The trouble is when films like Cold Mountain and The Brothers Grimm seem to have co-financing in place and then do not. I have no idea how Miramax was able to play Disney into those corners… probably because abandoning those projects after big investments - much as Universal did with the Denzel project recently - would hurt too much.

In the meantime, Miramax staffers - senior and not - continue to make their exit plans. Speculation has something happening soon, but the Weinsteins have always been timing guys. Unless they want no leverage, which is what they have now in the middle of a fiscal year, they will wait until May or so to start turning the real screws. And if the deal is right, don't be surprised to see them stay put… even if everyone at Disney and Miramax is screaming that it's impossible right now.

The L.A. Times' Sally Hofmeister is predicting a Sony IPO for the music and movie divisions. It makes sense and its probably the only way that Sony can get out of the movie business, which is like no business it wants to know and hasn't been since the Betamax went away. But is an IPO a sure bet for as large a media concern as Sony's domestic business? Had the Shark Tale opening been a bit weaker, that IPO might have fallen apart. But the DreamWorks Animation IPO was a simple business compared to Sony Entertainment. Two films a year, costs are pretty well set (salaries certainly went up on Shrek 2, but not nearly as much as in Spider-Man 2 or Men in Black II), no huge downside and enormous upside on a film like Shrek once every few years.

My guess is that the aforementioned Mr. McGurk is the one behind this IPO chatter. It's what he does best… the buzz manipulation and the stock market. And if he could spin off UA from the spin-off and coax the Weinsteins to come run it while he CEOs it… a dream come true.

Sony's Japanese home team certainly would like to get out of the movie business. Home Entertainment is their bird in the hand for now and they may jump in a hurry to make it work for them before the DVD market starts its inevitable slowdown. But Sony remains a much more interesting merger candidate than an IPO candidate. The swings in this business are much easier to deal with when you have other major divisions to offset bad seasons and years. But how big a company can they hook in with and how valuable an asset is a studio these days?

The bigger question is, what does one make of a movie industry that is so utterly integrated? Disney/ABC/ESPN, Fox/FBC/DirectTV, Paramount/CBS/Nick/MTV, Universal/NBC, Warner Bros/The WB/WarnerCable… a Sony/MGM standalone… DreamWorks divided… New Line tightening up… someone, maybe Warners, maybe this new Sony/MGM idea, buys Lions Gate for its library… how much longer can Time-Warner let its network remain on the second tier?

It's too easy to just scream "integration!!!" and run off crying. What is this going to mean to the future of film? Why is it feeling so horribly similar to the record business, from the corporatization to the hiring of guys who don't have much direct history with the medium but are good businessmen to the reality that the film business might be the weakest link on the chain of a huge conglomerate? It is certainly the least predictable.

By the end of 2005, we could have a movie industry universe overseen by Michael Lynton, Tom Freston, Bob Iger, Ron Meyer, Alan Horn/Barry Meyer and Peter Chernin. Familiar movie faces like John Calley and Michael Eisner are gone, not to be replaced by similarly familiar movie faces. The real power at Paramount will never be Brad Grey's so long as Freston is The Boss' Boss. Being a studio chief is a lot better than a lot of other gigs… but the power, perceived and real, is now in the hands of those whom they report to.

Who will Grey hire to manage the show underneath of him? Who comes to work for Dick Cook when Nina Jacobson heads out? If Sony spins of Columbia, will Amy Pascal bolt? How will Walter Parkes and Laurie MacDonald do without Steven Spielberg to raise their stakes? Will The Fockers and Kong to come shut up all the NBC noise at Universal? Can Batman and Superman make as much money in America as they do overseas? Will there be higher targets at Fox?

It's kind of funny. Critics, constantly whining about the quality of American film have become the replacement distraction for CARA now that Jack Valenti isn't around to quote LBJ every three minutes. The problem is that the system has become so cash driven… there is so much at stake… that only the biggest and smallest players can survive… and even so, there is an inevitable crash coming. Now that all the independent majors (read: MGM, Sony, DreamWorks) seems to be coming to their next versions of themselves, there is plenty of opportunity for one bad year to bring down one of the five remaining majors, even with them being less than 20% if the corporate balance sheet.

I expect 2005 to be a pretty easygoing year. But it may well be the eye of the storm. People are taking the reverses of a bunch of very important companies in great stride… kind of like the earthquake in South Asia. But 2006… now that is scary prospect… tsunami?

December 31, 2004 - The Ten Best
December 30, 2004 - The Ten Worst
December 29, 2004 - Movies You Should Have Seen, But Didn't