Reaching for the Brass Ring

MOVIES

Remember Cleopatra--that wildly ballyhooed Elizabeth Taylor-Richard Burton extravaganza of 1963? Executives of 20th Century-Fox wish they could forget; the movie cost $41 million to make, but has taken in considerably less than that at the box office. Yet much of the movie industry is acting as if it has in fact forgotten the big-budget flops that brought several major studios to the brink of financial ruin in the 1960s. Once again, studio heads--this time backed by the resources of conglomerates that have bought up most of the studios--are pouring huge sums into feature films. Some 20 movies costing $3.5 million or more each--a generally accepted dividing line between an ordinary movie and a big-budget one--are now in production or distribution, or twice as many as 18 months ago.

The switch back to big budgets is more sensible than it might seem. Movie attendance during the 1974-75 recession boomed to the highest level since pretelevision days, as people apparently flocked to films to forget their worries about inflation and unemployment. With the economy recovering and less need for escape, attendance in the first three months of this year dropped 10% below a year earlier. Studio chiefs need something to bring the patrons back. And it is the big-budget movies that have been drawing the crowds. The Godfather cost Paramount (now a subsidiary of Gulf + Western) $6 million to make, and so far has returned $145 million in worldwide rentals. Jaws (production cost: $9 million) probably will bring Universal and its corporate parent. MCA Inc., $180 million by the time it completes its first runs worldwide. Warner Brothers' All the President's Men (production cost: $7 million) has started off like the box office smash of all time; in its first six weeks it has earned $14 million in rentals in the U.S. and Canada, breaking The Godfather's record for initial success.

What all these movies have in common, besides expensiveness, is an elusive "special event quality" that gets them talked about until people regard them as a must-see. Since movie tickets now often sell for $3 or more--and a movie night-on-the-town, complete with dinner and babysitter, costs several times that--most Hollywoodians believe that only "special event" films can pull customers away from their TV sets.

Heavy spending, of course, no more guarantees success now than it did in the 1960s. Fox's $12 million Lucky Lady, starring Liza Minnelli, has been an utter flop that contributed heavily to the studio's first-quarter loss of $1.6 million. But moviemaking costs have risen so rapidly that it is just about impossible to attain special-event quality without a huge budget. Special effects like those in The Poseidon Adventure or Earthquake are frightfully expensive to film. Such "bankable" stars as Robert Redford and Barbra Streisand can easily command $1 million a picture; top-name directors like Hal Ashby (Shampoo) can earn up to $500,000. Craft union wages are up 15% over last year. Even a middling movie can end up costing $6 million, which makes it a gamble: such a movie generally must gross $18 million before it covers overhead and distribution costs and even begins returning a profit. "The numbers are incredible," says Mike Medavoy, United Artists' production chief. "I sometimes wonder about the logic of it all."

Logic notwithstanding, studios are increasingly grabbing for the brass ring. Warner Brothers last week began production of Exorcist II, starring Richard Burton. Initial budget: $10 million. Next year Warner will release two new megadisaster flicks produced by Irwin (Towering Inferno) Allen: The Swarm (bees do it) and The Day the World Ended. Each will cost well over $12 million. Paramount has in the works Dino De Laurentiis' remake of King Kong ($16 million or so). United Artists will ultimately release a version of Cornelius Ryan's tome on World War II, A Bridge Too Far, produced by Joseph E. Levine. UA's Apocalypse Now is a Viet Nam extravaganza presently being shot in the Philippines by Godfather Director Francis Ford Coppola. Total cost of the latter two movies: at least $30 million.

Wary Studios. The total cost, of course, is not always--or even usually --borne by the studio. De Laurentiis, Levine and Coppola, for example, are independent producers who raise much of the production cost themselves; the studios put up part of the money and take care of distribution. Thus United Artists, a subsidiary of Transamerica Corp., will pay only 20% of the cost of producing the two war movies. Indeed, studios are generally loath to spend as liberally as in the era of Cleopatra. Says MCA President Sidney Sheinberg: "If Jaws had cost $20 million, we would not have made it."

Another restraining influence on production costs is the presence of parent-corporation chiefs like Sheinberg to whom studio heads must submit budgets and progress reports, as they did far less commonly in the 1960s. "It's comforting to me to know they [the heads of the conglomerates] are up there," says the executive vice president for finance of a major studio. "Their solid position gives us the strength to know we don't have to go for the big hit every time." Well, maybe not every time--but more and more often.

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