FIRST LOOK AT THE STUDIOS : DEVELOPMENT GAME: ALL’S FAIR

At Warner Bros., the confidential “Project Status Report” is a bulky 40-page document that neatly catalogues about 250 movie projects in various stages of development. If one were privy to this protected document, one would find everything from a completed comedy script called “The Adventures of Babe West,” starring Goldie Hawn, to an abandoned idea titled simply “Yuppies.”

At Walt Disney Productions, a similar tome called the “Red Book” contains 80 entries, including the sequel to “Splash” and an adventure-comedy about children who shrink, called “Teeny Weenies.”

Known as “hot sheets” these development logs are the blueprints of the future for the studio production divisions. “In Development,” an umbrella term that covers everything from a newly purchased novel to a ready-to-shoot script, is the movie business’ equivalent of R&D; (research and development) in the aerospace industry.

While the studios have yet to produce a stealth bomber, the costs of motion-picture development are nearly as staggering. From the initial pitch meeting (when a story is verbally outlined by writer to studio executive) to a completed rewrite, the average script costs about $150,000 to nurture. The average major studio spends $10 million-$20 million annually developing between 100 and 200 projects, only a handful of which will become actual movies (see accompanying chart).

“It’s by far the least efficient part of the movie business,” says Scott Rudin, the recently appointed president of production at 20th Century Fox. “It’s simply indefensible.”

The development game arguably provides the clearest evidence of how the movie business is truly unlike any other. Imagine a business where (for a price, of course) new and untested products are traded back and forth among competing companies. Imagine a world where inventors are paid hundreds of thousands of dollars to produce state-of-the-art products only to see their wares abandoned once they come off the assembly line. Imagine a world where you can go to bed with a “green light” and wake up in “turnaround.”

( Turnaround refers to the process where one studio releases a script to another. In turnaround, the studio picking up the script pays the studio owning the script a fee to take over the project. “The Big Chill,” “Star Wars” and “American Graffiti” were picked up in turnaround.)

The development strategy at most studios is simple enough. To produce an annual crop of films, they need to develop at least five times as much material as they will use. The approach varies from studio to studio. While Warner Bros. typically has more than 250 projects in development, by the end of 1986 it will have distributed 20 movies. Disney, on the other hand will distribute 10 movies with about 80 projects on its development slate.

“It’s a matter of keeping your eye on the ball,” said one production executive at Disney who insisted on anonymity. “We don’t feel you can pay proper attention to that many projects at once. I guarantee you some of their (Warner Bros.) top executives haven’t heard of half the ideas on that list.”

A look at the Warner Bros. hot sheet (dated Aug. 1) is dizzying. There are 30 titles under the letter M alone, beginning with “Machine” and ending with “My Summer With Mom.” Under the T’s there is an intriguing script called “The Transsexual, the Bartender and the Jewish American Princess.” Under the C’s, comedy fans would be thrilled to find that “Caddyshack II” is being developed.

“Warner Bros. believes that owning and developing properties is the heart of running a successful studio,” says Robert Friedman, vice president of worldwide publicity for the studio. “Since most of our release schedule comes from development, we are quite pleased with the results.”

While it is difficult to generalize, those who do business with the studios on a daily basis estimate that a script in the development pipeline remains a long-odds proposition. “The odds are about 20-1 against the movie getting made,” explains John Ptak, a veteran William Morris agent. “A lot of it is in the ‘elements.’ You’ve got to have a good script, a bankable star or the right director and an awful lot of tenacity. Even then it can take years.”

Studio politics complicate matters further still. When a new executive comes in to take over the production reins--as recently occurred at Universal and Columbia--competing executives immediately assume that most of the projects in development but not yet green-lighted are going to be dumped into turnaround. Hence, producers with active projects at Columbia and Universal are now nervously awaiting decisions while executives from competing studios are combing the Columbia and Universal hot sheets for projects they can pick off.

“Off Beat” was a project developed at the Ladd Co. that Warner Bros. (which distributed the Ladd Co. movies) put into turnaround. It wound up at MGM, but when Alan Ladd Jr. took over as chairman he released the movie because he thought that green-lighting his own project would be a conflict of interest. Disney then purchased the script, which was released earlier this year. (Of the 72 scripts Ladd put into turnaround, only “Off Beat” was made into a movie. It died a quick death at the box office.)

Among the studios, development is not unlike a giant poker game where hands are swapped and the pots continue to climb. “Development is more competitive than I’ve ever seen it,” says John Goldwyn, senior vice president of production at MGM. “Unproduced screenplays are going for more money than ever and that’s partially because it takes such a long time to develop a movie.” (The average project takes about 18 months from pitch to the start of production.)

But the rules of the game may be changing. As costs rise, many studios are being forced to take a harder look at what they put into development. In an effort to produce a greater return on investment, Warner Bros.--Columbia, and possibly another studio are about to follow suit--now insists on being fully compensated for all development costs when putting a script into turnaround. Most studios have traditionally recouped only a percentage of development costs.

While some studios and production companies are willing to release projects they deem uncommercial, others seem unwilling to let the competition take a shot with a project they initiated. Says Goldwyn: “There are those people who don’t want to make it and sure as hell aren’t going to let anyone else make it either.”

That attitude can ruffle feathers in the creative community. Some studios believe that development deals are a good way of attracting the best “talent”--i.e., stars, directors and writers. The danger is that if you make too many development deals the talent can become frustrated when movies do not get made.

“We like to make a large portion of the things we develop,” says Gary Lucchesi, senior vice president of production at Tri-Star Pictures, where there are about 100 projects currently in development. “Development is where you can start important relationships with young directors and writers that may pay off later.”

At first blush, development may seem like a euphemism for wasted money but in reality it may be the most critical link in the movie-making chain. “Development is the lifeblood of this studio,” says Dawn Steel president of production at Paramount Pictures where 11 of 13 movies released in 1986 were developed in-house.

In the end, it is not the money or the quantity that ensures success in development. It takes “golden-gut” instincts about a fickle public and having the right mix of talent and luck to come up with the elusive formula for box-office magic.

So come on, play studio executive for a minute. Here’s the project: It’s a comedy called “Adventures in Babysitting” about a nightmarish evening in the life of a baby sitter and you’ve got Chris Columbus, writer of “Gremlins,” attached as first-time director.

So what do you say, give it the green light or pass? If you were Paramount you’d put the movie in turnaround (Paramount did) and let Disney gamble. Disney now has the project in development.

MOVIES MOVIES PROJECTS IN RELEASED DEVELOPED STUDIO DEVELOPMENT IN 1986 IN HOUSE The Cannon Group 30 26 21 Columbia Pictures 65 17 Disney 80 10 6 MGM/UA 90 11 6 ORION 17 12 8 Paramount 100 13 11 TRI STAR 100 17 7 20th Century FOX 100 16 4 UNIVERSAL 75 14 8 Warner Bros. 250 20 *