It’s All in the Stars : There’s really no logical answer to the question of why stars make what they do. : But here’s a look at some of the many and varied reasons that only seem to make sense in Hollywood.
Until just after the Fourth of July, movie stars were taking a drubbing at the summer box office. New films featuring Eddie Murphy, Kevin Costner, Julia Roberts were shot down in flames, rekindling Hollywood’s age-old debate: Why are stars paid so much money when they can’t even open a movie? Then along came Tom Hanks in a box of bonbons called “Forrest Gump,” followed by Arnold Schwarzenegger in “True Lies” and, most recently, Jim Carrey in “The Mask.” And the argument was turned on its side. “The truth is,” says one senior studio executive, “no star is worth the money you pay him--except in the right movie.”
And therein lies the classic Hollywood double-bind. There are about half a dozen solid reasons why studios pay upward of $7 million (dollar figures today are merely guarantees against a potentially larger profit share) to secure the likes of Murphy, Costner, Roberts, Hanks, Schwarzenegger, Mel Gibson, Sylvester Stallone, Tom Cruise, Harrison Ford, Michael Douglas, Robin Williams, Sharon Stone, Bruce Willis, Whoopi Goldberg and now Carrey. And only one very good reason why they shouldn’t.
The Wrong Movie vs. the Right
A star in the right movie--Hanks in “Forrest Gump"--can generate a $24-million opening weekend on a film despite its inscrutable title and lack of other obvious marketing hooks. Even in the wrong movie, “Last Action Hero,” for instance, a Schwarzenegger can draw $15 million from the curious on opening weekend. The right Schwarzenegger movie, “True Lies,” brought in almost twice that much.
How do you tell the difference? It’s almost impossible. “Studio executives sometime become much too excited about the obvious,” says “Forrest Gump” co-producer Steve Tisch. “We’ve all seen examples of actors who, because of their newly acquired power and leverage, are packaged into the wrong movies. The illusion that excitement creates overlooks some real problems.”
When a star is in the right movie, such as Costner in “The Bodyguard,” the rewards can be astounding--a worldwide theatrical gross of $500 million. When he’s in the wrong movie, “Wyatt Earp,” shirts can be lost. The $60-million Western, which clocked in at more than three hours, will gross only about $25 million domestically.
But it’s important to know that the one begat the other. The decision to commit to “Wyatt Earp” with Costner came in the wake of “The Bodyguard” and his two other period-piece blockbusters, “Dances With Wolves” and “Robin Hood: Prince of Thieves.”
In the unlikely event that Warner Bros. had decided against the movie, other studios would have tripped over their spurs to get it.
“You always have to count back 12 or 24 months to find the point on the calendar when the decision was made to get the star and pay him,” says producer and former studio executive Sean Daniel. Even Disney, the one studio known for being hesitant to cough up $7 million or more even for the right actor in the right movie, will occasionally pony up and pay someone like Roberts her asking price on a film like “I Love Trouble.”
“The thing is, if it hits with Julia, it hits bigger,” says one Disney executive. And even if it doesn’t, as was the case with “Trouble,” the studio needs a couple of “loss leaders” every year--flat-out star vehicles “that show you’re still in the business,” according to the executive.
The Mediocrity Meritocracy
The nature of the film business is such that the average cost of a film is now between $40 million and $50 million--$25 million just to produce and the rest for marketing and advertising. The impetus to get many of these films off the ground is that finite group of star performers. “They give studios a sense of security,” says David Schiff, an agent at United Talent Agency. “Sometimes it’s a false sense of security.”
The insurance the studios are buying is to protect them from their own mediocrity, says a senior studio executive. A great concept movie like “Speed” sells itself, while with a dud, like “Toys,” even a big name like Robin Williams can’t sell it. Stars are for everything in between. “The truth is, most movies are not really terrible and most are not truly great,” says the executive. “Most of them are just OK. A star is there to help those mediocre movies make money.”
This attitude, says another studio executive, is a reflection of the poor management that prevails at most studios. “The studios are struggling with material. They just don’t have it,” says the executive. “So all they’re doing now is filling in slots--especially summer and Christmas (which between them account for 60% of the year’s business). To greenlight those movies they need a big star name. And so they’re forced to pay big star prices.”
A recent example is Fox’s “Crisis in the Hot Zone.” Despite continuing script problems, it was given the go-ahead because Robert Redford and Jodie Foster had agreed to star. When Foster dropped out, the project came close to falling apart.
The Short List
How do actors get on that select list of names that has studios panting for their services? Usually on the heels of a surprise commercial success--Roberts in “Pretty Woman,” Willis in “Die Hard.” Carrey leaped onto the list with “Ace Ventura: Pet Detective,” going from $650,000 a film to $7 million overnight. “The actor establishes his price when the market is most favorable,” says UTA’s Schiff. “And success has a funny way of securing that position. You have a long time to disprove yourself.”
Another way for an actor to climb on the list is an accrual of fine supporting performances, which seems to be the way Tommy Lee Jones is headed. Standout performances in support of Harrison Ford in “The Fugitive” and Steven Seagal in “Under Fire” have led to co-star outings in “The Client,” “Blown Away” and the upcoming “Natural Born Killers” and “Batman Forever,” gradually upping the actor’s price ($5 million for “Batman Forever”). Whether he can carry a film solo, however, will be the ultimate test, and should his starring role in “Cobb,” the Ty Cobb biography due for release later this year, be a substantial hit, Jones could be breathing the rarefied air of the Short List denizens.
At all times, however, the list remains small and is based on a number of factors, a primary one being foreign appeal. Certain actors, especially action stars (Schwarzenegger, Stallone, Willis, Seagal, Jean-Claude Van Damme), have become commodities to be bought and sold on the international market. “Whether he opens a movie or not, it’s the ultimate economic results that justify the actor’s fee on the next film,” Schiff says.
Since action films often gross twice as much abroad as in the United States, Van Damme and Seagal are major stars offshore. Most of their films do well here but clean up overseas. Christopher Lambert is the exception of an actor who is a major action star overseas but not in the United States.
Based on the success of “Speed,” Keanu Reeves has been penciled onto the list of action stars. “It will take months and years before the movies that came out of that momentum are looked at,” says Daniel. Depending on the outcome of those films, Reeves will either move onto the permanent list or be scratched off.
A component in Reeves’ favor “is that Tom Cruise and Kevin Costner can’t star in every movie,” says Tisch. “Besides, Cruise and Costner are in a position to develop their own material. That makes it tougher for me as a producer and I have to pay more for actors on the next level.”
The Teflon Coating
The old saying “you’re only as good as your last picture” doesn’t apply to today’s highest-paid stars. Once they’re at a certain level, stardom creates a Teflon coating, shielding the actor from mistakes. In the industry, “Wyatt Earp” is considered an honorable failure, a film with high ambitions that didn’t quite come together. Despite the losses incurred in making it, were Costner up for grabs (he’s already filming another mega-budget film, “Waterworld,” for release next summer), there would still be a stampede for his services. And they would pay his asking price--said to be $10 million to $12 million.
If Costner’s no lesser a star after “Earp,” neither is Roberts following “I Love Trouble.” She is protected by her appearance in three of the most successful women’s vehicles in recent years--"Pretty Woman,” “Sleeping With the Enemy” and “The Pelican Brief,” all of which grossed northward of $100 million. And were a producer with a starless script to get a commitment from Roberts, the project would find financing overnight.
Schiff makes the comparison with the sports business. If a baseball player has a multiyear, $15-million contract and has one bad season, he argues, the contract isn’t canceled. “He still draws fans to the games and to the sport itself. There are additional values.”
“When Julia Roberts stars in a movie,” says entertainment attorney Peter Dekom, “it creates a higher awareness on the part of the audience and the press. Until such time as that’s no longer true, she can command big bucks.”
The most in-demand stars not only have Teflon coatings, they develop infrared bomb deflection devices. “No one blames Robin Williams for the failure of ‘Being Human’ or ‘Toys,’ ” says one industry source. That ignominy goes to the films’ creators, Bill Forsyth and Barry Levinson, respectively. But Williams, and not necessarily director Chris Columbus, is credited with the mega-success of “Mrs. Doubtfire.”
Does anyone remember that Tom Cruise’s “Far and Away” was a misstep? Do you suppose when he offered his services for “Interview With the Vampire” that anyone suggested that he should take a cut in his reported $12-million per film salary since his last period piece didn’t work out? No, the project went from being a long-awaited adaptation of an Anne Rice novel to a potential blockbuster starring Tom Cruise.
Producer Wendy Finerman spent nine years waiting to get “Forrest Gump” made. And one of the main reasons it did get made, says co-producer Steve Tisch, is Hanks (along with in-demand director Robert Zemeckis and screenwriter Eric Roth). The industry will recognize Zemeckis and Roth’s contributions. But to the public, it’s a Tom Hanks film.
Hot to Un-hot
Teflon, like any other coating, is subject to erosion. Eddie Murphy’s coating may have been damaged, if only temporarily. Industry insiders still consider him bankable, “a continuing delusion,” says one studio executive. “Beverly Hills Cop III” was a disappointment from the standpoint of cost ($65 million with his salary alone eating up $15 million). And he is coming off a bad run, including “The Distinguished Gentleman” and “Boomerang.”
“To get cold takes two or three movies that have contempt for the audience,” says the senior studio executive. “Eddie has one more chance with (the upcoming) ‘The Nutty Professor.’ Otherwise he’ll suffer the Burt Reynolds syndrome. He’ll have trashed his career.”
But, counters entertainment attorney David Colden, “Murphy still has a following if he’s in the right vehicle.” And as was true with a Bill Murray or a Sylvester Stallone, career lulls are made to be broken. That’s why even during a down time, certain actors maintain their high prices.
“There’s always a chance that the actor’s next film will be the one you want it to be,” Daniel says.
For Murray that slump-breaker was “Groundhog Day”; for Stallone, “Cliffhanger.” But since “Rocky,” Stallone has never not been a star. “Some actors remain stars no matter what,” says Colden. “Studios will take risks on those actors, especially within a specific genre, hoping to hit the lottery on the next one.”
What stars do in the meantime, suggests Dekom, is maintain the appearance that they’re not taking a salary cut--like demanding the same gross participation in a film but not taking a salary up front. Another alternative is to either lower the cash amount or the profit percentage.
“Studios will look for an opening to cut a salary if they can,” Daniel says. “Agents will look for an increase or to hold the line. Studios rarely succeed.”
Some actors who’ve had some bad luck try to climb back up by taking assignments in which they can shine but don’t have to carry the film. Bruce Willis, for one, has done cameos and small roles that redefine his parameters as an actor. He’s been garnering great notices for the upcoming Quentin Tarantino film “Pulp Fiction,” which had a budget of $8 million--or almost half of what Willis will reportedly be getting to star in “Die Hard III.”
One star whose name rarely appears on the high-priced list, but is as big as most of those names, is Clint Eastwood. He is unique among the short-list players in that his long-term agreement with Warner Bros. waives big up-front payments in favor of a large share of a film’s profits. Consequently, says one top agent, his films come in under the $25-million average, allowing him to experiment with projects like “White Hunter, Black Heart” and “Unforgiven.” The former failed and both he and WB took their lumps. The latter was an Academy Award-winning blockbuster and everyone went home much richer.
Gender and Genre
The “price club” is almost exclusively male. The reasons are that the most reliable genres are action films and comedies--which are male-dominated--"and that most movies are written for men,” says one producer.
The exceptions are Roberts, Sharon Stone, Whoopi Goldberg and Barbra Streisand. “Women, regrettably, have less to gain and less to lose,” says Schiff. “They’re rarely called on to carry movies and rarely given credit for their success.”
However, top-ranking women are not given as many chances to fail, says the talent agent. And Roberts and Stone are no exception. “They have to be extremely careful about their material,” says the agent, who is putting his money on more consistent and varied actresses like Jodie Foster, Meg Ryan and Michelle Pfeiffer.
The same devaluation afflicts dramatic actors, male and female, although there are a select few--Robert De Niro, Meryl Streep, Al Pacino-- who command high prices because they bring a certain critical cachet to their projects, despite the hit-and-miss performance of their individual films.
Performers like Streisand, Redford and Dustin Hoffman set themselves apart by doing fewer films than they’re offered. Consequently, each outing becomes an event--at event prices.
It would only be a slight exaggeration to say that such names as Cruise, Ford and Hanks attached to a film version of the Los Angeles white pages would merit serious consideration from studios. Each has proven himself in various genres. And their percentage of recent hits to failures is extremely favorable. “The fact that they could do the phone book, however, doesn’t mean that they should,” says the talent agent.
What Price Stardom?
Those are the reasons certain stars can and do get megabucks for their films. But are they really worth it? In terms of glamour and appeal, probably so. When it comes to overall profitability of the movie business, maybe not.
As Daniel points out, the really profitable pictures this year have been “Four Wedding and a Funeral,” “The Crow” (both independently released) and “Speed"--films without big box-office names and, consequently, much lower budgets. “The high profit margins come from the surprises,” Daniel says.
A hit movie with box-office names, a film such as “Maverick,” not only costs more (reportedly $60 million) because of star salaries, but is ultimately less profitable for a studio because actors like Gibson retain what is called “first dollar gross”: They get a percentage of the gate from every ticket sold, even before the studio recoups its investment. The top stars get between 10% and 15% of the gross.
“You have to subtract at least $20 million of the profit from hit movies with stars who have gross participation,” says Daniel.
“If you have more than one gross player,” says the Disney executive, “in order for the studio to make money, it has to be a really big success.”
But from the studios’ viewpoint, says the talent agent, “they’re happy to collect their distribution fee (35% of receipts) and overhead (15% of the budget). So the talent comes out OK and so does the studio, even though films like ‘Rain Man’ and ‘Batman’ don’t technically break even.”
Overall, the rate of return on movies today is “pretty shabby,” according to Dekom, who quotes a recent Variety statistic placing the figure at around 8.7%. A better-performing mutual fund returns 10% to 13%, he says.
“It used to be that the studios saw rates of return between 30% and 50%,” says Dekom. “Those profits have gone to actors and some directors. They’re the ones who make that profit today.”
Does that mean actors will eventually price themselves out of the market? “In theory, yes,” says Dekom. “In reality, no."*