Hollywood dream factory turning into a nightmare

Press, 17 April 1982, Page 15

Hollywood dream factory turning into a nightmare

From WILLIAM SCOBIE in Los Angeles

Behind the cheers, tears, and seif-congratulatory rites of the annual academy awards show last month lay a very different story. Hollywood, the dream factory, is reeling from a year of costly flops, management turmoil, labour unrest, dwindling profits from network television, and huge studio losses in film production. Executives are loath to admit it, but of the 80-odd films released by major studios last year, about 10 have turned a profit. For many movie people at the overblown, overlong . Oscar ritual, the. triumph of Britain’s "Chariots of Fire,” made for a modest $5 million, was the final insult- : of a year devoid of . fond memories. ' “When I came to Hollywood, long ago,” said the former Warners producer, Steve Greene, “people told stories of pizza palace waiters who rose to be,ace producers with homes in the Hollywood hills. From the Hollywood hills today, the pizza business looks real good. I’d open a place myself if I had the money.’’}, / Metro-Gbldwyn-Mayer — facing a crushing debt of $675 million — typifies the industry’s financial troubles. Two years ■ ago, the \ M.G.M. mogul, Kirk Kerkorian, hired "ace!’ producer David Begelmari, who is credited with saving- Columbia Pictures

from bankruptcy in the 19705, to restore Leo the Lion as monarch of the Hollywood jungle. Today, Begelman — according to industry insiders — is on the way out Film after film from M.G.M. has failed dismally at the boxoffice. A splashy musical called “Pennies .From Heaven” that cost $3O million to make and market has returned $2.4 million. Of 10 Begelman productions that cost M.G.M. $l6O million, just one has earned back its investment. M.G.M. has lost more than $lOO

million on films which,a rival studio chief said last week, “looked like lousy money prospects from the start.'* ; The usually astute Kerkorian, lord of the Las Vegas financiers, compounded M.G.M.’s problems by buying up ailing United Artists for $360 million and assuming its $235 million debt A payment of $lO9 million falls due in May and rumour has it that M.G.M. will be unable to meet the deadline. . “K. K. (Kerkorian) always buys when things are bad,” said his top aide, James Aljian. Things looked very bad at U.A. Although

staggering from a $4O million loss on the disastrous “Heaven's Gate" epic, the old studio did possess a valuable library of 2500 films for sale to the booming home video market. It has been takeover time in Hollywood. Columbia fell to Coca-Cola, primarily for the value of its real estate, and its big film- library. There’s no sign of increased film production. Twentieth Century Fox went to the Denver oil tycoon, Marvin Davis, who plans to bulldoze the entire historic back lot to make way for office buildings. Overall, box office revenues are down by 10 per cent That means hard times for actors, writers, and directors. In some craft unions, unemployment stands at 50 per cent. Even the grandest of Hollywood stars have their woes. Barbra Streisand had to hawk her new movie "Yentl" personally around the studios before U.A. agreed, on its own tough terms, to distribute it. Robert Redford was told to come up with co-financing for a pet project. Raquel Welch was brusquely fired from an M.G.M. set for mak-

ing prima donna demands — and was replaced by an unknown. Wunderkind directors of yesteryear, such as Francis Ford Coppola, who three years back could do no wrong, now complain that studio chiefs will not return their calls. American films are doing poorly abroad, too: industry analysts say income from foreign markets is down 15 to 20 per cent. If America is not going to the movies, what is it doing for entertainment? Industry analysts say the prime audience, the 12 to 29 age group, is spending fantastic sums on the new video arcade games. Others wait for new films to appear on a welter of newlyavailable cable TV services. A handful of films — usually light, frothy entertainments — still draw massive audiences. “Raiders of the Lost Ark," a comic-book adventure, has grossed a whopping $lOO million since release last summer. "Superman II" did .almost as well. But the writing on Hollywood’s wall remains gloomy.

Even the Oscar award circus, which has captivated American TV audiences since the 19505, is slipping. This year’s telecast had its lowest ever percentage share of United States viewers.— Copyright, London Observer Service.