Company Town : CANNES DIARY : Festival a Lure Even With Slump in Business

While the Cannes Film Festival makes for a colorful backdrop for announcing deals, the business climate is said to be pretty grim this year.

Buyers complain that there aren’t enough high quality, star-driven films. And sellers say there are too many bargain-seekers trying to rip them off.

“Business sucks,” says veteran producer Sandy Howard, who’s in town seeking investors for a series of low-budget films and a TV series based on the movie “A Man Called Horse.”

Howard’s film projects include “Firebird,” about two dogs that fall in love, only to be hunted down for ransom money, and an anti-gun picture called “Out of Control.”

One reason for the slowdown is the demise of many of the independent production companies that sprang up in the 1980s. Those companies fueled sales and tended to host the most extravagant parties.

Meyer Gottlieb, president of Samuel Goldwyn Co., says Cannes has also become too expensive for buyers from smaller countries. “There are no Latin Americans here,” says Gottlieb, whose films include the critically lauded “Much Ado About Nothing.”

Despite the problems, many Hollywood producers still cannot resist the lure of the French Riviera. “It’s always a circus and a hassle,” says Ed Pressman, a Cannes perennial. “But it’s also the best forum in the world for seeing the many aspects of film. I always say I’m not going to come, but I always do.”

One of the bigger ironies about Cannes is that many of the most powerful players do their business elsewhere--at the ultra-chic Hotel du Cap in neighboring Antibes. Much of Hollywood’s upper echelon would be wiped out if the hotel’s dining room terrace were to collapse during lunch-time.

Earlier this week, the lunch crowd included Walt Disney Studios Chairman Jeffrey Katzenberg, Universal Pictures Chairman Tom Pollock, New Line Chairman Robert Shaye, Carolco Pictures Chairman Mario Kassar, power lawyer Jake Bloom and a large contingent of executives from Sony Pictures. Sony hosted a party at the Cap for the upcoming Arnold Schwarzenegger picture, “Last Action Hero.”

Also there, for reasons unknown to several people who stopped over say hello, was Walter Yetnikoff, the former chairman of CBS Records.

The choices of English-language television in Cannes are usually limited to CNN and MTV. But people who cannot wait to see “Wild Palms” can catch all three parts of the mini-series at the American Pavilion, which caters to reporters and other U.S. citizens at the festival with American favorites such as Corona beer. The series is being offered on a closed-circuit telecast.