Hollywood’s 15 Minutes of Silence on GATT

On occasions as rare as Rams victories, Hollywood puts away its long knives and closes ranks for the sake of self-protection. It happened during the Heidi Fleiss scandal this summer, and it’s happening now in connection with the General Agreement on Tariffs and Trade talks.

With entertainment industry issues emerging as the final hang-up in the 116-nation agreement being hashed out in Geneva, Hollywood executives are giving an Oscar-worthy impression of solidarity.

A virtual cone of silence has descended over the industry as the GATT talks near their Wednesday deadline. Studio executives by consensus are referring all questions to Motion Picture Assn. of America President Jack Valenti, who has also developed a rare case of publicity shyness--refusing all comment until after GATT is concluded.

Sources say the industry is determined not to break ranks on GATT, as it has on so many other issues, since it is feared that any stray statement could undermine efforts to reach an accord on the discussions. One studio source even expressed concern that President Clinton’s recent swing through Hollywood might hurt the talks, since opponents could use it as ammunition to charge that he’s blindly accepting the entertainment industry’s stand on GATT.

“At this point, there’s not a lot of reason to be fueling the incendiary fires of rhetoric brought with any public statements,” said Jeff Logsdon, an entertainment analyst with the Seidler Cos. in Los Angeles. “Let the guys fight it out in Europe.”

That appears to be the attitude of the expense account crowd at Le Dome, the Ivy and other Hollywood hangouts as well. Industry sources confirm that in recent weeks, people have spent more time discussing the holiday box office grosses than the international fate of their industry.

“I haven’t heard anyone even mentioning” GATT, said David Colden, a well-connected entertainment lawyer. “It seems as though people don’t understand the impact, except at the highest levels.”

In the past, Valenti actively tried to rally public support for his GATT stance--both by buttonholing reporters and speaking out at international conferences. He used this year’s Cannes Film Festival, for instance, as an excuse to drop in on the stubborn French negotiators.

But Hollywood’s position in the seven-year trade talks has always been sensitive, since it challenges quotas and subsidies designed to protect Europe’s fragile entertainment industry.

While Hollywood can get around some restrictions through international partnerships, GATT will have a substantive impact on the industry’s global expansion, one way or another.

Industry analysts say billions of dollars in profits are at stake in the long term. Entertainment is also the country’s second leading export, accounting for a $4-billion trade surplus last year.

According to one recent account, revenue from the foreign sales of theatrical, TV and home video rose 10.2% in the first six months of the year.

“Roughly half of the business comes from foreign . . . and about a third of that half comes from the European Community countries,” Logsdon said. “That’s 15% to 16% of total revenue. So the stakes are pretty high.”

With U.S. negotiators offering an 11th-hour compromise on certain key issues--such as foreign royalty payments and limits on the amount of American television programs--Hollywood executives still held out hope for a solution late Monday. At the same time, one rumor had audiovisual issues being dropped from the GATT talks altogether, to be taken up at a later time.

People close to the talks say another reason for the deafening silence in an industry where the most casual conversation often evolves into a confessional is Hollywood’s strong faith in Valenti’s ability to deliver on GATT.

Foreign trade issues are seen as one of the strong suits of the silver-maned movie lobbyist, who cut his political teeth in the Johnson White House.

“A lot of people have talked to him, but they don’t have to counsel him,” said one executive. “He knows it’s his No. 1 priority. And he’s good at this stuff.”

Others, however, claim that Valenti is still getting plenty of counsel from industry veterans such as Warner Bros. Chairman Robert Daly, Warner Bros. President Terry Semel, Walt Disney Co. Chairman Michael Eisner, News Corp. Chairman Rupert Murdoch, MCA Chairman Lew Wasserman, MCA President Sidney Sheinberg and MGM Chairman Frank Mancuso.

Two other Hollywood executives who have been active in GATT discussions--Disney President Frank Wells and Fox Inc. Executive Vice President George Vradenburg--happen to be in Europe this week. Sources said Wells is there on Euro Disney business and not because of the GATT discussions. Vradenburg’s secretary refused to say what he’s doing there--offering more proof that the “mum’s the word” policy is working.

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Black Box Babble: The 4,500 lavishly designed video boxes that Columbia Pictures had hand-delivered to Academy Award voters last week are still generating a lot of conversation around town.

The boxes contain nine videos that Columbia has deemed worthy of Oscar consideration, but outsiders have come up with other ways of using the containers.

One suggests that it would make perfect living quarters for director-producer Tim Burton, who has a fondness for all things black. Another says it’s just right for storing the nine classic movies made by Fred Astaire and Ginger Rogers. Still another suggests using it as a coffin for small animals.