As 1993 stumbles out the door, it’s King of the Hill time again in Hollywood--that time when entertainment companies do battle over market supremacy. And, as usual, it’s getting ugly.
Peter Guber, chairman of Sony Pictures Entertainment, has challenged reports giving Warner Bros. the domestic box office lead, on grounds that Sony actually comes out ahead when the revenue from its four independently run distribution companies is accounted for.
Guber argues that Sony’s box office gross reached $912 million last weekend based on that formula, compared to Warner’s $888 million. Warner insists it’s still in the lead, while privately fuming over Guber raining on its parade. People with a good institutional memory will recall that there hasn’t been this much bad will since Sony hired Guber and Jon Peters away from Warner.
Coincidentally, Sony and Warner have also spent the year vying for the record industry’s sales crown. Warner is headed for a win in that one, though the race isn’t technically over until the last CDs and cassettes sold by Mariah Carey and Snoop Doggy Dogg are accounted for.
“You’re talking about a real bid for bragging rights,” said one source.
Indeed, while market share is irrelevant to the public--and often to a company’s bottom line--it’s taken as a symbolic measure of achievement by the people who peddle pop culture. That’s one reason Guber is interrupting his Aspen vacation to wave the Sony flag.
He contends that the studio perennially gets the short end of the stick in market share tallies because the industry refuses to combine the revenue from Columbia Pictures, Tristar Pictures, Triumph Releasing and Sony Classics.
“We grossed $912 million year-to-date,” Guber said. “That’s the best performance by any company if you look at it on an absolute basis.
“The distributor market share concept is a vestige of the days when this was a cottage industry,” he added. “Today we are global companies. We admit it’s close. We just want it acknowledged that, as of now, we’re on top.”
Guber’s crusade may be driven partly by the desire to put a positive spin on Sony Pictures’ year, after the debacle of the film “Last Action Hero.” But whatever the merits of his argument--Sony refuses to consolidate its distribution operation under one banner, for its own philosophical and business reasons--Guber’s having a tough time getting a tradition-bound industry to listen.
While Paul Kagan Associates recently put out a report giving Sony the box office edge, the Hollywood Reporter and Variety both tabulate market share on a distributor-by-distributor basis. It’s also reported that way by most outside agencies that collect the data.
The box office chart supplied to The Times, for instance, lists Warner as the leader, followed by Buena Vista and Universal. Sony’s Columbia is ranked fourth, while Tristar is seventh. Sony Classics and Triumph together account for only 1% of the market.
At Warner, which takes winning as seriously as anyone since Vince Lombardi, Guber’s argument gets as much sympathy as the Kansas City Chiefs got in Super Bowl I.
While the Burbank-based company publicly declined to comment on the issue this week, executives there privately insisted they have rightfully won the crown by any measure--especially with “The Pelican Brief” making a strong end-of-year showing.
“We’re the No. 1 distributor, and by a large margin,” one Warner executive groused. “There’s no question about it.”
In recent years, the box office crown has usually gone to either Warner or Disney, though a memorable controversy erupted in 1989, when Warner and Universal were separated by only $10,000 in box office revenue. There’s also plenty of wiggle room in the year-end results since they’re based on an outmoded honor system.
This year, one reporting agency tallied roughly $350 million less in annual domestic box office receipts than another--which is a sizable gap in a $5-billion-a-year business.
Despite all the Sturm und Drang , however, Merrill Lynch analyst Hal Vogel says the market share races are virtually meaningless.
“Whenever it’s close, it gets very intense, because each company wants to say in its annual report that ‘we’re the largest company.’ But theoretically, you could be second or third in market share and first in profitability.”
On the record side, the competition this year was waged more quietly, but with no less intensity, with Sony executives regularly touting their weekly market share gains behind the scenes.
The most recent tally by Soundscan gives Warner Music Group labels 20.88% of the market, compared to Sony’s 18.01%. That’s expected to hold through year’s end, even though overall sales have also been brisk during the holidays. Soundscan reports that there were 31.7 million units sold this week, compared to 29.3 million for the same period a year ago.
While Sony has the top-selling record, with Mariah Carey’s “Music Box,” Warner also has a major hit in Snoop Doggy Dogg’s debut, “Doggy Style.” One record executive, who asked not to be named, said the competition is healthy.
“Warner has traditionally had the edge, but Sony has made inroads recently,” he said. “It’s not as important as the Nielsens, but the competition is still there.”
Table hoppers: Everyone knows that Barbra Streisand’s concert at the MGM Grand in Las Vegas is the hottest ticket on New Year’s Eve.
But that’s apparently not enough excitement for some Hollywood people, who are also planning to catch Frank Sinatra’s show the same night. Since Ol’ Blue Eyes is appearing in another venue at the MGM, it’s possible to segue from one main event to the next.
The cost? If you have to ask, you can’t afford it.