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Haggling with the Stars
For really big stars, it isn’t about a reduced salary. For decades, the ultimate status symbol in Hollywood has not been a fast car or a Birkin bag but “dollar-one gross.” That means getting a share of the studio’s gross receipts regardless of whether the studio has earned back its costs. The studios struggled to hold the line on the amount of pure, uncut gross that big-name stars, directors, and producers could reap. (The notorious peak came in 2000, when Universal had more than 30 percent of the profit committed to Jim Carrey, Ron Howard, and others on How the Grinch Stole Christmas. The film grossed more than $340 million worldwide and still wasn’t considered a success.)
The studios seem determined to all but kill off these rich deals, especially on big-budget films (where the risk to the studio is highest). “If a budget is over $100 million, they don’t want to give dollar-one gross to anybody,” says a leading agent. Now, studios insist on recovering their costs before stars dig into the profits. If a star has clout, the studios might offer a bigger-than-usual slice of profit or big bonuses if the film turns out to be a hit. With those, a star could make even more money under the new system than he would have under his old, dollar-one gross deal. (Baiting the hook this way doesn't appeal to the thrifty folks at Marvel, however. Marvel wouldn't give up a lot of profit on a hit movie just to reduce its risk if a movie disappoints. Connors says it in COO-speak: "Giving away a huge amount of upside to protect a downside—that's a strategy that doesn't make sense for us.")
The concept of delaying the talent's payout until the studio recoups is not new. The Pirates of the Caribbean sequels were so expensive that they were made—simultaneously—on this basis and everyone came out ahead. And Clint Eastwood has long made his movies this way, which could be one reason why he controls his budgets with so much discipline. (The cheaper the movie, the sooner the studio gets its money back and the sooner his payday begins.) Insiders say Eastwood raked in the biggest payday of his career on Gran Torino because he got 30 percent of gross once the studio recouped its costs.
But now Hollywood is trying to make this new kind of arrangement the standard. It obviously carries risks to the talent if a movie winds up losing money, and as much as agents and other talent representatives want to insulate their clients from risk, they admit they don’t have much leverage at this point. “There’s no end to the bullshit the studios will play and if you call ‘em on it, there’s no conversation to be had,” the talent representative says. “They don’t deny that they’re doing it. They have the upper hand. The only question is, how long will it continue?”
Kim Masters is the host of The Business, public radio's weekly show about the business of show business. She is also the author of The Keys to the Kingdom: The Rise of Michael Eisner and the Fall of Everybody Else.
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Kim Masters covers the entertainment business for The Daily Beast. She is also the host of The Business, public radio's weekly program about the business of show business. She is also the author of The Keys to the Kingdom: The Rise of Michael Eisner and the Fall of Everybody Else.
smdunne
Julia Roberts is over and "Eat, Pray, Love" precisely the kind of middle brow tripe she sells so well, will be lucky to turn a profit in a market where folks will have little patience for a woman who spends a few months eating, praying and loving at a time when folks are praying that they will be able to eat. The new realities are great, no more inflated salaries for marginal talents and bonuses get paid once profits have been made. Sounds like a plan.
mk1228
I have to agree with dunne. Roberts is a middle of the road actress at best and her portrayal of Brockovich doesn't seem to be much of a stretch compared to other actresses of her generation who've played transformational roles ie. Winslet-The Reader, Theron-Monster/North Country, Berry-Monster's Ball. Those were roles worth $20M if any and not just for some box office formula. Julia is overrated and overpaid, but hey if you can get it, well.....
Rafter
I haven't even gone to a movie theatre in about 6 or 8 months. I'm not sure why exactly. It's not the price of a ticket really. I think it's a combination of my disgust at the idiotic politics of about 2/3rds of those that make movies who won't accept that they are simply actors and not world leaders too. Also, the movies themselves don't appeal to me. It's not the lack of technology of course. Must be that the stories just don't appeal to me. I'd rather read a good book.
This comment has been removed by The Daily Beast's editors.
sabre460
Hooray!! Now let's start looking at the pro ball players who spend part of their year dabbling in their favorite boy-hood pass-time and making obscene millions from it!
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lljpence
And? They've been way overpaid for way to long. I don't hear the MSM screaming about the unfairness of Hollywood's over inflated salaries. Especially for the benefit they provide to society. What is that benefit anyways?
kthevs
llipence, the benefit is helping us escape to another world and entertaining us even in the darkerst times.
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BrendaC
Wonderful! I hope they learn to keep their big mouth shut when it comes to politics. I hope they start losing homes and jobs. We'll see what they have to say about things once they are REAL working AMERICANS.
This comment has been removed by The Daily Beast's editors.
This comment has been removed by The Daily Beast's editors.
bolab1
I agree with Rafter. Most of the current talent, male and female, seem to be newly rich adult children living in a virtual world filled with cute plastic toys. Many of us are tired of leather/gothic films replete with special effects and sub-woofer powered sound systems. Now that the BluRay and Ipod MP4 formats have been hacked, the actual values of new releases are just what they are worth, the price of a blank BluRay DVD or hard drive space. This way, one may delete the fare after three minutes of watching or listening. I watched the special features disc provided with the "Dark Knight" video. Boy, was I unimpressed with the reverance paid to the God's of virtual reality. These people will walk around Hollywood Boulevard looking like zombies if their batteries or cell sites drop out. Why do most of the Netflix movies from the 1930,s -50's have worn jackets? Most of the newer releases seem almost never rented. Classic Criterion DVD jackets usually come almost worn out.
timcruz
There's a hole in this argument.
Julia roberts is in 90 pages in eat pray love.
Scarlet is in 8-9 in the recent draft of IM2 I read.
Julia Roberts is also a bigger star as well as the rehearsal process that will eat up her availability.
Scarlett has yet to lead a major studio release and is only needed 10 days at the most.
Mickey's price is because of the ratio pushed for the INSURANCE BOND PRICE that went up 2 percent as soon as he was approved for the Budget.
Plus MARVEL STUDIOS can pull shit like that.
Seal4Life
Contemporary Hollywood is composed of talentless, wooden, shallow, over-rated lemmings. Julia Roberts is one of many. People talk of the excesses of "Big Oil' and 'Big Finance', but take a look at the salaries some of these hacks are receiving and it's obscene. And they've been fleecing us for years. They need to sacrifice and give back to the folks who brought them -hey, isn't that what the President is advocating ? Theatres are closing not because of the challenged economy but because of the abysmal product Hollywood produces. The movie business is producing predictable garbage - all cut from the same production and philosophical template. Hopefully it will melt down and from it, finer entertainments will be produced. But I doubt it, it's in the hands of accountants and people who are, at large, not very creative.
MikeJC
First, let's get a myth out of the way Sundunne. Gobs of people are NOT praying about their next meal. Geez, how soft have we become? Unemployment is at 8.5%. That is nothing compared with the 25% of the depression or the 11% of the late 70's, early 80's, yet people are talking like its the end of the world. Sack up!! You are listening to too many politicians. (and I don't see them stopping any parties for themselves) The recession was not ever as bad as promoted, and the economy is now beginning to recover. So, what?, the hard times lasted maybe 6 months before recovery began? Oh, you poor things. I don't mind an actor making lots of money. I don't mind a banker making lots of money. I don't even care about some people getting a bonus that taxpayers are partly funding. What I do mind are a bunch of down and outers complaining about it when THEY don't even pay the taxes for it. Yeah, check out the real facts. The top 25% of income earners pay 85% of the total income tax. The bottom 50% pay only 3% of the total. So, I am sorry, the poor people are not bailing out the rich people. The poor people aren't doing a thing and are not paying a thing. Well to do people are bailing out well to do people. Poor people, or even most middle class people, aren't paying the freight, so they shouldn't have any real say either. If you want to put in your opinion, then pay 35% of your income into the game and then you can have an opinion.
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