Big Profits Raise Profile of the ‘Small Movie’

Of the five movies in the running to win the Oscar for best picture tonight, the one producing the biggest bucks for the bang isn’t the record-setting extravaganza about the sinking luxury liner, or even the one featuring a big star like Jack Nicholson as an obsessive, compulsive writer.

It’s the quirky one about the stripping unemployed factory workers with no stars in it that cost about what the catering budget runs on some major movie productions.

Made for a mere $3.5 million, “The Full Monty” could ultimately turn a profit of around $100 million, making it by far the biggest return on the dollar for any movie released last year, even “Titanic.”

While the public attention has been riveted on the mammoth box office grosses for “Titanic” and previously on the money generated by such blockbusters as “Men in Black” and “The Lost World: Jurassic Park,” it’s a handful of what once were considered “small movies” that have returned to Hollywood some of the highest amounts of money per dollar invested.

“Good Will Hunting,” the film about a genius janitor that cost $16 million to make, could turn a profit of as much as $50 million, even after Robin Williams is rewarded with a cut some estimate could reach as high as $20 million. In recent years, other modestly budgeted films such as “Babe,” “Pulp Fiction” “Bean” “Little Women,” “Four Weddings and a Funeral,” “Clueless” and “Fried Green Tomatoes” produced some of the best returns on the dollar for any films this decade, although most didn’t get the kind of public attention a typical Hollywood blockbuster gets.

The whopping returns for films like “The Full Monty” are part of a growing phenomenon. Smaller films released without much fanfare that once would have had a limited box office potential have increasingly shown they can break out from the pack, and sometimes even do the kind of business a major Hollywood film does.

Credit such factors as an aging baby boom audience that wants more than conventional studio fare appealing to the broadest possible audience, a younger Generation X audience that has latched on to some independent filmmakers, and theater chains more willing to book smaller films into suburban multiplexes instead of traditional urban locales. Whereas a few years ago a small film might be lucky to open on a dozen screens in the Los Angeles area, today they can often open on as many as 50.

“You’re now able to get into the suburban, upscale multiplex on the last remaining screen,” said Mark Gill, president of Miramax LA, a company widely regarded as the best at marketing smaller films.

Add to that a foreign box office that has exploded in recent years--films such as “The Full Monty” and “Bean” performed much better overseas than in the United States. Finally, virtually every significant company that distributes smaller, specialized films is now owned by a deep-pocketed entertainment conglomerate. So when a movie like Fox Searchlight’s “The Full Monty” or Miramax Films’ “Good Will Hunting” comes along, there’s a big entertainment company--Rupert Murdoch’s News Corp. and the Walt Disney Co., respectively--lurking behind the scenes with money to exploit the movie in ways that weren’t possible just five years ago.

“It’s not that these movies were never made before,” said Fox Searchlight Pictures President Lindsay Law. “But truly successful independent film distributors in years past were relatively small companies that had limits on spending. In the old days, the kind of companies that would have released a ‘Full Monty’ were always cash-strapped.”

Hollywood isn’t giving up on expensive blockbusters. While it’s nice to have a stable of smaller films that can provide healthy returns and possibly break out into a major hit, Hollywood remains a high-octane business.

Studios still aim to have a few expensive, “event” movies a year that can return the huge amounts of revenue needed to fuel studio operations. Indeed, “Titanic” director James Cameron has estimated that the film, which cost $200 million-plus to make, could generate a profit of $600 million to be shared by the two studios that financed it, 20th Century Fox and Paramount Pictures. Although that return on investment doesn’t match that of “The Full Monty,” given a choice of one over the other, it’s a sure bet every studio executive would take “Titanic.”

20th Century Fox chief Bill Mechanic describes it as something of a polar system in which studios such as Fox are “getting out of the middle” range of films, movies that are considered financially riskier than either low-budget films or higher-budget ones. That’s because big-budget films usually boast a star, director or screenwriter who can lure people to the theaters and smaller-budget films carry little financial risk. It’s the middle-range movie--in the $50-million range--that has “middle-range ideas and middle-range casts,” as Mechanic puts it, that often don’t excite audiences.

The smaller films fall into two categories: the sophisticated, specialized “art house” films such as “Chasing Amy” or “The Sweet Hereafter,” and low-budget comedies. Producer Robert Simonds, who specializes in the latter, describes the films as “portfolio movies.” Simonds, whose latest film is the hit Adam Sandler comedy “The Wedding Singer,” has a deal with Universal Pictures to provide five such films a year that will be part of Universal’s “portfolio.”

“The movies I make are about show business, not show fun. The intent is a return on investment, and the films are designed to make a profit,” he says.

In an increasingly risky era when the average cost to make and market a major studio film has soared to more than $75 million, the search is on more than ever for “the next ‘Babe,’ ” “the next ‘Pulp Fiction’ ” or “the next ‘Full Monty.’ ” As part of that search, virtually every studio has either acquired or set up their own unit devoted to small, specialty films, no doubt enticed by the business potential.

“If done properly, these movies can not only be creatively very satisfying, but economically satisfying,” said Robert Friedman, vice chairman of Paramount Pictures, where a new specialty film unit is being set up.

Finding the hidden hits is the trick. In most cases, the films emerge from nowhere to become hits. “The Full Monty” was brought to Law’s attention by a longtime acquaintance (although a lawsuit has been filed claiming the idea was lifted from a New Zealand stage play). Screenwriters and actors Matt Damon and Ben Affleck had been developing “Good Will Hunting” for years.

Still, sometimes there are logical reasons why some smaller films take off that may not be apparent at first. William Morris film agents Mike Simpson and John Burnham, instrumental in putting together “Good Will Hunting,” note that director Gus Van Sant has long enjoyed a strong, loyal following among independent film fans although his previous films such as “To Die For” and “My Own Private Idaho” weren’t big hits. In the age of the Internet, such followings have become more common.

While results of such films as “The Full Monty,” “Pulp Fiction” and other smaller films have had a positive effect on the independent film business, giving them the kind of business cachet they’ve never enjoyed before, some fear that the obsession with finding the small movie-turned-blockbuster is crowding out good, worthy films that may not have the same financial legs.

“It’s become more hits-driven. You don’t have people talking about aesthetic successes. It’s become more like a scoreboard. People are trying to hit home runs all the time,” bemoans Geoff Gilmore, director of the Sundance Film Festival for independent films.

Some filmmakers find that despite past successes, getting these films made is still a chore because studio executives often view successful ones as flukes. Producer Lili Fini Zanuck produced the Oscar-winning “Driving Miss Daisy” with her husband, Richard, a film that cost $7.5 million, grossed $133 million worldwide and won a best picture Oscar. She said it’s still a struggle to get a smaller film produced.

“The morning after the Oscars you realize it isn’t any easier to get these pictures made,” Zanuck said. “Studios look at these little movies as nonrecurring phenomena.”

That’s because for every “Full Monty,” there are scores of small films that disappear before most people even noticed they are playing.

According to ACNielsen EDI, which tracks the film industry’s box office, 271 films were released last year with limited distribution--playing on less than 600 screens for most of their runs. Of those, only “The Full Monty,” “Chasing Amy,” “The Wings of the Dove” and “Deconstructing Harry” generated more than $10 million at the box office. A handful of films that played on a few more screens, such as “Eve’s Bayou,” “Love Jones” and “Def Jam’s How to Be a Player,” did more than $10 million as well. The vast majority, about 260, did less than $3 million total at the box office, less than half of what “Titanic” grosses on a Saturday night.

One of the watershed events came in 1993 when Walt Disney Co. bought Miramax from founders Bob and Harvey Weinstein, enabling a company that had stretched every penny to the maximum to back its movies with some of the deepest pockets in the industry. Four years ago, Miramax’s market blitz for “Pulp Fiction” pushed its box office total past the $100-million mark domestically. In 1996, Miramax was able to finance most of the $33-million cost of “The English Patient”--which won a best picture Oscar--after 20th Century Fox balked.

“ ‘Pulp Fiction’ would have never done as well as it did without Disney’s backing, and ‘The English Patient’ could never have been made without them,” Miramax’s Gill said.

Other studios have followed suit. Fox started its own division, while Paramount is doing the same. Universal Pictures acquired control of October Films.

Some veteran producers warn against trying to spot blockbusters among smaller films because it’s too hard to predict which films will catch on.

“The big picture doesn’t have to be a big picture going in,” said producer Irwin Winkler, whose films include “Rocky.” “The big picture can be a little picture that becomes a big picture because it somehow captivates an audience.”

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And the Winner Really Is ...

Financing and the bottom line for the five films nominated for best picture vary considerably. Each movie cost tens of millions to market, on top of what it cost to make. The average studio film marketing cost is now $22.2 million, and it was probably higher for these films. Here are details on financing, along with projections from industry sources of eventual profits--after costs and when the last videocassette is sold and the film has played on Bolivian pay television:

“The Full Monty”

What it cost to make: A paltry (by Hollywood standards) $3.5 million

Financed by: Fox Searchlight Pictures

Profit picture: Could generate profits as high as $100 million.

****

“Titanic”

What it cost to make: $200 million-plus

Financed by: 20th Century Fox, which launched the project, and Paramount Pictures, brought in later to share the risk. Paramount capped its investment on the production at $65 million, with Fox picking up the rest.

Profit picture: Director James Cameron has speculated it could generate $600 million in profits, split 60-40 in Fox’s favor.

****

“As Good as It Gets”

What it cost to make: About $52 million

Financed by: Sony Pictures, which has a deal with director and producer James Brooks

Profit picture: Solidly profitable, although industry estimates vary because star Jack Nicholson and Brooks will share in the bounty. Estimates are $60 million to $75 million.

****

“L.A. Confidential”

What it cost to make: About $35 million

Financed by: New Regency Productions, the film producer headed by Arnon Milchan, with Warner Bros. getting a distribution fee. Regency tapped its bank line of credit from European financial institutions Berliner Bank and Hypo Bank. Regency investors paid to get various rights. German TV baron Leo Kirsch gets rights in Germany, Italy and Switzerland, with Korean industrial conglomerate Samsung getting Korean rights. Australian billionaire Kerry Packer gets free TV rights in Australia.

Profit picture: After a slow start, the film’s producers say it will end up in the black. Industry estimates put the eventual profit at around $10 million to $15 million.

****

“Good Will Hunting”

What it cost to make: About $16 million

Financed by: Miramax Films

Profit picture: Probably from $30 million to $50 million, after star Robin Williams receives a cut that some estimate could be as high as $20 million.

For complete Oscar coverage, log onto the Times’ Web site at https://www.latimes.com/oscars

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