Value in the Vault : Entertainment: Re-releasing classic films such as ‘The Ten Commandments’ can generate solid profit. So more studios are doing it.

With virtually no publicity budget, an ancient script and a star whose career peaked more than 30 years ago, the recent Paramount Pictures release hardly had the makings of a hit.

So it was almost tantamount to the Red Sea parting when Cecil B. DeMille’s “The Ten Commandments” drew epic-sized audiences to the Cinerama Dome in Hollywood last week, performing so well that it was quickly booked into eight more Southern California theaters.

In that brief interval, it ascended into the pantheon of classic films, including “Lawrence of Arabia” and “Gone With the Wind,” that are capable of generating cash and cachet for their owners long after their initial release. Those who champion Hollywood film preservation say motion picture executives are just starting to comprehend the full value of such movies.

“People around the world have discovered that their holdings are not dead storage but are in fact capital assets,” said Robert Rosen, director of the UCLA Film and Television Archive. “So preservation is no longer an esoteric process. We’re at a turning point in which the industry is realizing the economic value of putting those beautiful films back up on the screen.”

While classic films have always been revenue producers, in the past they earned their keep mostly through television and revival house showings. Now those same films can generate big profits in video, pay-per-view cable television and other markets, especially when they are given high-visibility theatrical send-offs.

And while a “Ten Commandments” will never reap the huge profits of a “Batman,” the financial risks are also infinitely smaller.

The restored “Lawrence of Arabia,” which received reams of favorable publicity upon its theatrical re-release last year, earned about $2 million in profit for Columbia Pictures. Alfred Hitchcock’s “Rear Window” brought $12 million in revenue to MCA/Universal Pictures. And “Bambi,” the 47-year-old Walt Disney Co. feature, had the highest profit margin of any film in 1988.

The full impact from those windfalls can be seen all over town as Hollywood indulges in something akin to preservation mania. While there has always been restoration work--Columbia, for instance, has a 15-year-old film preservation program--studios have been hesitant about major theatrical re-releases because of print-making costs. Now it is almost fashionable.

In the past several weeks alone, Paramount Pictures announced that it was taking steps to preserve and restore its entire library in conjunction with the planned re-release of a whole crop of its best-known properties. Warner Bros. followed with news that 26 of its top titles were scheduled for make-overs. And a group of top directors, including Martin Scorsese, George Lucas, Woody Allen and Steven Spielberg, have formed a group called the Film Foundation that hopes to raise $30 million on behalf of future preservation work. The end result will be that Hollywood can honor its past while salvaging many potential profit makers.

“The industry has mourned the loss of a substantial amount of the work done pre-1960, and they are going to do everything they can in terms of the future,” said Jeffrey Logsdon, an analyst for the brokerage Crowell, Weedon & Co. in Los Angeles. “But I’m sure it’s motivated primarily by economics.”

Ronald Haver, film curator at the Los Angeles County Museum of Art, estimates that there are 40 to 50 older films capable of attracting respectably large theatrical audiences. And UCLA’s Rosen contends that the bulk of Hollywood’s important movies could be salvaged for the cost of one big-budget feature. Columbia spent $600,000 restoring “Lawrence of Arabia,” considered a major project. But experts say some restorations can be done for as little as $20,000.

The major studios will not discuss the dollar value of their libraries, and even securities analysts who track the industry complain that it is virtually impossible to determine a library’s worth because of the complex licensing agreements under which they operate. “There’s just no set rule,” said Paul C. Marsh of Bateman Eichler, Hill Richards Inc. in Los Angeles.

But there are some prime indicators. Reissues accounted for nearly 10% of Disney’s theatrical film revenue last year, bringing in about $50 million. MGM/UA Communications Corp.’s library of 1,000 old United Artists films is considered its richest asset. The library is also at the heart of a lawsuit challenging the $1.2-billion sale of the studio to Pathe Communications Co. In that case, producer Alberto Grimaldi says he stands to lose as much as $500,000 a year from such staples as “Last Tango in Paris” if the deal is allowed to stand.

Disney has long been recognized as the master at breathing new life into old films. It is legendary for its skill at marketing such warhorses as “Bambi” and “Jungle Book” for periodic theatrical re-release. The studio’s latest project, three years in the making, is the restoration of “Fantasia,” timed to coincide with its 50th anniversary in October.

Richard Cook, president of distribution, said the key is treating reissues as new films. “In each case, we certainly make sure our (advertising) campaign is fresh,” Cook said. “We don’t just go back into the cupboard and dust something off. . . . Plus, you need a fabulous piece of product that doesn’t age. . . . There will always be an audience for great entertainment.”

And a profit to be made. “Bambi,” which cost $2 million in 1942, grossed $39 million in 1988 alone, and has generated $100.3 million in domestic release.

If Disney is the king of animation reissues, however, it is Ted Turner who is credited with doing the best job of mining Hollywood’s live-action past. His $1.3-billion purchase of the MGM library and subsequent deals for the use of films from other studios provided him with a rich source of movies for his cable channels and helped pave the way for today’s preservation activities.

Once bitterly criticized for colorizing classic films, Turner is now widely credited with helping to save those films--since they had to be restored before they could be colorized.

Two of his all-time classics, “Gone With the Wind” and “The Wizard of Oz,” got red-carpet treatment last year in recognition of their 50th anniversaries. Both were re-released theatrically and on home video, and both proved to be as golden as the jeweled city of Oz.

“Gone With the Wind,” which cost $350,000 to restore and promote, generated a $7-million profit, with 220,000 copies of the videocassette being sold. “Wizard of Oz,” was an even larger success, netting the company $10 million and selling 3 million videocassettes.

Roger Mayer, president of Turner Entertainment Co., said anniversaries make for perfect marketing campaign tie-ins. With that in mind, the company is already preparing for next year’s 50th anniversaries of “Citizen Kane” and the first “Tom and Jerry” cartoon.

“When those things occur and there is a reason to restore something, we have the means necessary to do it,” Mayer said. “We’re spending $1.5 million to $2 million a year, not counting special projects. That’s the ordinary, routine cost of keeping a library in good shape.”

There has always been some market for Hollywood’s older films, even in the days when they were mostly shown in some crudely edited form on television or played for the benefit of film buffs on college campuses and in revival houses. What touched off the most recent spate of theatrical revivals was the 1981 restoration and re-release of Abel Gance’s “Napoleon.”

The silent 1927 masterpiece earned rave reviews and generated big business at special engagements that featured a live orchestra performing a new score for it. Encouraged by “Napoleon’s” success, UCLA restored and re-released “Becky Sharp,” the first color film. The re-release of other cleaned-up classics, such as “Intolerance” and “Lost Horizon,” soon followed.

Not all have proven successful. The 1955 version of “Oklahoma!” and the 1954 version of “A Star Is Born” received lukewarm receptions from contemporary audiences. But the lessons learned from those re-releases have helped studios better plan their strategies.

Hollywood executives say “down times,” such as the relatively quiet period before big-budget summer releases, are ideal for revivals. Studios have also learned that they can often get by on little marketing outlay, since the films attract a lot of press attention. Especially likely to generate enthusiasm is a restored film with added footage.

The cost of restoring films varies greatly. Some prints are basically dusted off and given remastered sound tracks, while others require tedious frame-by-frame reconstruction.

In the case of “Ten Commandments,” Paramount’s selling point was a totally restored 70-millimeter Super VistaVision print with six-track stereo. The studio played the 1956 classic, which had not been seen in its original state for more than 20 years, at various theaters around the country before putting together a splashy Los Angeles premiere at the Cinerama Dome. The venerable Charlton Heston, who played Moses, signed autographs at the premiere.

Paramount executives said they were stunned by the reaction to the film. “We sold out every seat in the Cinerama Dome, which is beyond belief,” said Executive Vice President and General Sales Manager Jeff Blake. “It was as hot a ticket as there was in the city.”

Milton Moritz, vice president of advertising and public relations for Pacific Theatres, confirmed that “Ten Commandments” was a major success, with more than 300 people being turned away at the door the day of its final showing. The film grossed about $40,000 during its four-day run at the 1,000-seat theater and is expected to take in much more in wider release.

Equally surprising was the strong showing of Paramount’s “Funny Face,” a 1957 Stanley Donen film. Scheduled for a special one-week engagement at the AMC Century City 14 Theatres, it lasted three. Among those pressing for admission to a sold-out show one recent weekend night was actress Shirley MacLaine. “We started it off in a smaller theater, then moved it to a bigger one,” said Jeff Agnone, the manager. “The week it opened, it was our fourth-biggest picture. We’re presenting this to our film buyer as a case for running more classic films.”

Paramount won’t discuss costs, but the studio has clearly made a significant commitment to future preservation projects by erecting a 40,000-square-foot Archive Building on its Hollywood lot. The state-of-the art facility will house everything from “Queen Elizabeth,” the 1912 film that launched Paramount, to popular television shows such as “Cheers.”

Running the show for Paramount is Michael Schlesinger, formerly of MGM/UA. Schlesinger said Paramount selected its initial batch of re-releases by polling managers of classic movie houses. Future premieres of restored films will also be held at major theaters, he added.

“You have to counter the natural instinct of, ‘Oh, that’s on TV,” he said. “What we are selling is the theatrical experience. Movies were meant to be seen in theaters.”

Repertory theaters, which flourished in the pre-video years, may be among the biggest beneficiaries of those plans. Schlesinger said there are still 50 to 60 “prime” repertory houses in operation nationwide, all starved for pristine-quality prints.

Gary Meyer, executive vice president of the Landmark Theatre Corp., which owns 88 first-run and repertory theaters, including the Nuart in West Los Angeles and the Rialto in South Pasadena, said restoration efforts could lead to a resurgence in classic film houses. His company holds periodic classic film festivals at its first-run theaters and is working on getting restored versions of the Preston Sturges movies.

Meyer sees a bright future for such films. “Every time somebody goes to see a ‘Manchurian Candidate,’ a ‘Ten Commandments’ or a ‘Funny Face’ with a fine print--the way it was made to be seen--they come out excited, knowing this is the way to see those movies,” Meyer said. “And those same people wind up becoming the audiences for the reissues that follow.”