||FEATURE-Terrorism, recession take toll on showbiz
By Elizabeth Guider, Dana Harris and Claude Brodesser
HOLLYWOOD (Variety) - Showbiz is in a funk.
Every nook and cranny of the biz -- from messenger services
and masseurs to post-production houses and party organizers --
is feeling the malaise.
"I've never seen things quite so dead or people so antsy,''
says one veteran talent agent who fears her bonus may be halved
Whether it's screenwriters who are resigned to penning the
umpteenth draft for no extra cash, PR firms that aren't getting
paid by their clients or pitches that are being turned down
because there's no money, the entertainment biz right now is in
a rude mood.
The downturn started 18 months ago with the dot-com
debacle, which poured cold water on dreams of instant riches.
That was quickly followed by narrowly averted actors' and
writers' strikes, which nonetheless threw a monkeywrench into
the town's film production pipeline. A worsening overall
economy gave momentum to the downward spiral. Pink slips have
hit almost all the major studios, with high-flying cable outlet
MTV Networks being just the latest.
Third-quarter earnings of all the media firms -- save
French-based Vivendi Universal -- have come up short, while the
six broadcast networks are reeling from a billion-dollar
shortfall in ad revenues this year. All this before Sept. 11.
Since the attacks, things have, not surprisingly,
Security has been stepped up on all the Hollywood studio
lots, parties and premieres are being scaled back and projects
that could be in questionable taste are being shelved or
Perhaps more worrying is the angst that has taken hold of
studios in the wake of 9/11: There's less productivity, more
second-guessing and a creeping paralysis among creatives, many
of whom now want to work only on "important'' projects.
"It would be one thing if all we were experiencing was a
downturn in our own financial well-being. But all this is
happening in a nation under attack, so it creates even more
anxiety,'' says one TV exec.
There are, however, a few bright spots, especially on the
home entertainment area.
Wary of public places, people have deserted theme parks and
rock concerts but made a run on DVDs, CDs and even TV sets.
Blockbuster, for example, managed a 6% rise in revenues in the
third quarter to $1.3 billion.
And, fortunately, in true counter-recessionary style, some
parts of the mainstream entertainment biz are showing
People are going back to the movies: The domestic box
office could, according to industry forecasts, top out at a
record $8 billion, despite there being relatively few standout
pictures on offer.
Established TV comedy hits such as "Friends'' and "Everybody
Loves Raymond'' are earning their best Nielsen ratings in
And shaken but stalwart New Yorkers, lured perhaps by
discounted tickets, are venturing back to Broadway theaters.
By most accounts, however, Hollywood is not likely ever to
return to the go-go levels of the mid-1990s. The economic
models that underpinned the film and TV biz simply are no
What's more, the war against terrorism has cast its own
cloud of uncertainty over the entertainment biz. Old formulas
won't apply if there's another round of terror attacks or if
the anthrax scare spreads.
A two-part series on the problems facing various sectors of
Not only did the town get an instant education as to what a
real crisis looked like on Sept. 11, but the terrorist attacks
quickly led to tightened security on the lots, including
mandatory ID badges and full-vehicle pat-downs.
But these are just the latest in a series of measures the
studios have had to adopt as they begin to cope with both the
worsening economy and the post-attack malaise.
Already, studios were grappling with the task of producing
increasingly expensive films that, somehow, are supposed to
provide a larger return on investment.
Add to that a painstaking re-examination of the product
filmmakers are turning out: Every picture on a studio's
development and release slates is being scrutinized for what it
brings to a world rocked daily by reports of war and threats of
Hollywood at the moment is doing everything it can to
shield its audiences from extreme forms of violence.
MGM pushed the John Woo actioner "Windtalkers'' to next
summer and Miramax moved Martin Scorsese's "Gangs of New York''
to early next year.
"The depression at the studios goes beyond the attacks,''
says Dean Devlin, producer of movies including "The Patriot''
and "Independence Day.''
"Making a movie is a year and a half of your life. You
can't do it without passion. And all of our passions have been
As for indie producers, they're faring even more
precariously in these perilous times. German entertainment
companies, which poured millions into the indie system, have
retrenched now that the Neuer Markt has collapsed.
"You look at overhead and core structure and see if they
make sense,'' says one indie film exec. "If they can meet their
profit potential with a smaller cost structure, that's what
they're going to do.''
In Hollywood, that's been translating to cutbacks, where
studios like 20th Century Fox are putting the clamp on expense
accounts and travel allowances as well as overtime payments.
However, the film industry can take some comfort.
Despite a brief downturn in September, the public still is
going to the movies. The 2001 box office since Labor Day stands
at $796 million, 8% above last year, suggesting Sept. 11 hasn't
scared people away from theaters.
As for subject matter in the movies, expect Hollywood's
heightened sensitivity to last for some time.
Currently, studios favor mainstream projects that don't
rock any boats (think Steve Martin and Queen Latifah in
Disney's "In the Houze''), while any project that contains
themes connected to the Sept. 11 attacks will be rejigged or
Nowhere is the economic pinch being felt more keenly than
among those doing the dealmaking. Agents are watching
helplessly as the stark new reality dawns:
"The idea that, 'Oh, directors always work,' is being
challenged,'' says one International Creative Management agent,
adding, "If you're young and hot, you'll work. If you're hot
and good, you'll work. But it's the middle-range writer and
director that's in real trouble.''
Agents, too, are recognizing the need to economize.
One agent who's employed at a Big Five shop confessed she
recently headed to (gasp!) downscale restaurant Koo Koo Roo to
read her scripts. Initially fearful someone would recognize
her, instead she arrived to find numerous colleagues -- with
Rush messenger? Not unless it's for Chris Rock, thank you.
The head of one midsized shop was aghast when he saw that bills
for messengering scripts last year came to $250,000. Now, he
says, many shops like his are going to be using mostly the U.S.
mail -- anthrax or no.
The trouble comes from movie studios that are now subsumed
into vertically integrated congloms, which themselves are
taking a beating from a decelerating TV ad market, which in
turn mirrors a sagging economy.
"We are all working for The Man right now,'' deadpans Devra
Lieb, a partner in literary shop Hohman Maybank Lieb and an
agent of 18 years.
"For a lot of writers, it means no more staying home in
Santa Monica and waiting for your agent to call. You've got to
have energy to go out and meet. You have to fight like a
Worse, agents say, the heightened stakes have studios
looking to brand names more than ever before.
"Studios are playing it a lot safer,'' laments one William
Morris agent. "And only lots of B-level jobs at studios. But if
you don't work, you may not work for another six months or a
Or at all. Even top-level directors are feeling pressure to
drop their prices or be washed out of the game, Lieb says.
"Agents are becoming far less aggressive. You're just not
hearing the kind of swaggering and posturing on deals that was
routine before Sept. 11,'' says one TV exec.
||Friday, November 9, 2001
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||Wednesday, November 7, 2001
[News] FEATURE-Terrorism, recession take toll on showbiz (1:00PM)
[News] Mouse House welcomes Baby into Disney family (1:00PM)
[News] ''Clones'' hitches new trailer to "Potter'' print (5:00AM)