Saturday, December 5, 2009

The costs of Hollywood spending

Who benefits when filmmakers raise the tentpole?
James Cameron was quoted in the Wall Street Journal not long ago arguing that "when a studio goes crazy and spends a lot of money, it's the consumer who benefits."

Translated, that means that if Jim Cameron decides to reinvent the lexicon of filmmaking in a mind-bogglingly expensive movie like "Avatar," the filmgoer will enjoy the thrill ride -- and won't pay more for it. Much more, anyway.

With the world awaiting "Avatar's" release, we shall soon see if Cameron has performed that re-invention. In any case, having poured $300 million into the movie (or $400 million if you run the numbers differently), it's Fox that's waiting nervously to find out whether "the King of the world" again will earn all the ka-ching in the world.

Whatever the outcome, I would argue that the move to ever bigger and more extravagant movies will hurt the filmgoer long-term, not benefit him. Here's why:

Fueled by burgeoning foreign grosses, the studios are intent on making fewer movies at more grandiose budgets and at the same time diminishing their investment in "risky" low and mid-range dramas. The result: A numbing succession of tentpoles that may all but drive indie-style films out of the multiplexes.

Further, the era of the "big spend" will increasingly contaminate the few dramatic movies being made. "Lovely Bones," the Paramount-DreamWorks Christmas release from Peter Jackson, is an intimate film that cost almost $100 million to produce. Will the massive special effects improve or diminish the impact of the basic narrative? One key reason for the setbacks suffered by both Miramax and Paramount's Vantage division was the impulse to pump up spending both in production and marketing.

I remember the off-the-cuff commentary of Mike Nichols some years ago in describing the budget crunch on arguably his best picture, "The Graduate." When a young director finds his budget shrinking, recalled Nichols, he is compelled to not spend more, but invent more. The result often is a better movie.

In an economy where the big companies are under pressure to cut costs, filmmakers paradoxically feel the pressure to amp up their budgets. Audiences overseas want big-canvas action pictures that offer more effects and less dialogue. Simultaneous releases around the world may diminish piracy, but they expand marketing costs. The distributors demand instant gratification and are willing to pay for it.

I hope "Avatar" is a big hit and that the always modest and understated Cameron once again proves his techno-smarts. Even if that happens, however, the average filmgoer will still emerge the long-term loser.

Is Tom Cruise overpaid?

Like most people, I've always been intrigued by Forbes' lists of the "wealthiest" and "most powerful," but I've never figured out quite how they line up with their numbers.

Now, however, Forbes has a list I can relate to -- the most overpaid stars in Hollywood. The individual rankings, Forbes says, are based on a return-on-investment formula involving each star's compensation and each movie's gross. Forbes, of course, believes it has reliable data on star paydays, even though those numbers remain obscure to the rest of us.

The upshot: Will Ferrell, Eddie Murphy, Ewan McGregor and Tom Cruise are on the top of the "overpaid" list. Inclusion of Murphy and Ferrell is understandable, but Cruise apparently is vulnerable due to "Lions for Lambs." As for poor McGregor, he's apparently made too many classy movies like "Trainspotting" and thus represents a bad buy compared with, of all people, Shia LaBeouf, who by Forbes standard is the best buy for the buck among actors. Go figure.

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