Chapter 525

In Los Angeles, Carver City, inside the chairman's office at Sony Pictures Entertainment headquarters, Michael Lynton was discussing the current situation with Amy Pascal.

"What do you think about DreamWorks' Cowboys & Aliens project?" Michael Lynton asked Pascal.

Amy Pascal shook her head with a bit of disdain. "Even Disney isn't interested, it's a project that Charles Capet specifically passed on. I don't think it's worth the effort. Besides, DreamWorks' performance over the years hasn't been great unless Spielberg directs the movie himself.

They spend money recklessly. Let Relativity Media and DreamWorks handle it. Relativity Media is working on an epic Greek mythology war movie, Immortals, with a $75 million production cost, and they plan to release it themselves next year!"

Michael Lynton nodded. "Indeed, our collaboration with DreamWorks has been minimal. Spielberg often works with Universal, Warner Bros., and Paramount. You met with Ryan Kavanaugh from Relativity Media, didn't you? Did he complain again?"

Amy Pascal laughed, "Yes, he did. Initially, Relativity Media funded many movies jointly by Sony and Universal. Now, with Capet merging with Universal, Universal has cut 90% of their projects for the next two to three years. Many of those were partially funded by Relativity Media.

Universal's stance is to only distribute the films, with Relativity covering the rest of the funding or handling the distribution themselves. Cowboys & Aliens is a big investment from Relativity, but Universal pulled out of both funding and distribution, and Disney isn't stepping in either, so they came to us at Sony."

Michael Lynton knew that Universal recently sold the distribution rights for a comedy Larry Crowne, directed by and starring Tom Hanks with Julia Roberts co-starring, to Summit Entertainment.

They also sold the production rights for The Change-Up to Sony Columbia. It was rumored that they were negotiating with Warner Bros. to sell the distribution rights for The Adjustment Bureau, which starred Matt Damon and had already begun filming.

As for the projects Universal outright canceled, those were even more numerous.

"It's like Universal is having a clearance sale," Michael Lynton sighed, "So, what's Capet Universal's attitude towards Relativity?"

"Very aloof," Amy Pascal mused enviously, "With Charles Capet, does Universal lack funds? The collaboration between Relativity Media and Universal is strained. Capet Universal is not interested in mid-to-low budget projects anymore; it's now about special effects blockbusters with budgets of $200 million. Relativity can't afford joint investments on that scale. Funding two big movies could drain Relativity's accounts tied to Universal!"

Michael Lynton chuckled, "Capet Universal won't put their ace franchises in the mix. There might be a Marvel movie, but franchises like Transformers, The Hangover sequels, or the Twilight series? No way."

Just like Sony wouldn't put the Spider-Man series in joint investments, Relativity Media was just a funding source. Allowing participation in movie production itself was a bonus.

This is why Relativity Media and Legendary Pictures wanted to distribute their own movies. A film investment company alone won't go far.

"Cowboys & Aliens is a big project that Relativity sees a lot of potential in. Ryan Kavanaugh's data analysis suggests it has a market. I believe Relativity might team up with DreamWorks to develop it," Amy Pascal shared her thoughts.

"A budget over $150 million, without financial backing from big companies like ours? Even with overseas pre-sales, they'd still need to finance $100 million," Michael Lynton chuckled, "Maybe Ryan Kavanaugh will try to manage this blockbuster on his own, but the investment in Immortals is not on the same scale as this.

Relativity Media spent a lot at the start of the year buying Rogue Pictures, a B-movie distribution label, from Universal. Now, I heard they're negotiating with Starz to acquire some shares of Overture Films, their independent film distribution company, to build a North American distribution network.

Using a big investment like Cowboys & Aliens to make a name for themselves isn't a bad idea!"

Amy Pascal agreed with this point. With Universal's project cancellation, Relativity did save a lot of funds.

If Ryan Kavanaugh is willing to spend, he could promote Cowboys & Aliens in North America.

"However, for a new company to handle such a big project right off the bat, it's tough. Even if they solve the funding issue, having experienced distribution personnel is a major challenge," Amy Pascal had her doubts.

"When Charles Capet started, he acquired Atlantis Pictures and then began with low-budget movies to build his distribution channels. He knew how tough marketing a big movie could be."

Capet initially signed distribution contracts with Universal to learn from them.

He started distributing low-budget movies like Saw, Little Miss Sunshine, and Hostel, all under $10 million budgets.

Later, movies like No Country for Old Men, The Devil Wears Prada, and Walk the Line were all under $30 million budgets.

*****

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