Universal Pictures is suffering the worst box-office slump of any of the major studios, with its current domestic market share lower than it's been in more than a decade.
Sources say top management is grappling with the question of whether the studio's prolonged box-office malaise is a cold streak that can happen to any movie company or if it indicates a more fundamental problem that could result in the removal of movie Chairman Casey Silver.
"Eighty more days of bread and water until it hits," Silver has told friends and colleagues, confident that Universal's forthcoming holiday movies will generate tens of millions in box-office dollars and mark a sorely needed turnaround for a studio whose movies, with few exceptions, have under-performed for the last three years.
Universal's market share has sunk to an embarrassingly low 4.3%, relegating the studio to ninth place behind all other major distributors, including DreamWorks, New Line and Miramax, and just a hair above the beleaguered MGM, which also is suffering a dramatic box-office drought.
According to its own internal statistics for Jan. 5 through Aug. 23, 1998, Universal's new releases and holiday holdovers collectively grossed a mere $189.8 million at the U.S. box office, compared with Paramount's $836.8 million, Disney's $589.4 million, 20th Century Fox's $561 million, Sony's 551.1 million and Warner Bros.' $522.2 million.
Universal executives believe that by year's end the studio's fortunes will reverse and its market share will greatly improve. Silver and his production team, headed by Stacey Snider, are counting on the commercial prospects of the studio's forthcoming movies, which include Martin Brest's romantic drama "Meet Joe Black," starring Brad Pitt and Anthony Hopkins; George Miller's "Babe: Pig in the City," a sequel to the 1996 hit; Gus Van Sant's remake of Alfred Hitchcock's 1960 classic thriller "Psycho"; and "Patch Adams," a dramatic comedy starring Robin Williams and directed by Tom Shadyac.
It's no small wonder that Silver and his supporters are anxious to fast-forward.
Universal's most recent release, "BASEketball," opened to a paltry $3 million last month in 11th place and will be lucky to gross $7 million, becoming the latest in a string of box-office losers that have plagued the studio this year. Going back three years, the studios' only big hits have been Steven Spielberg's "The Lost World: Jurassic Park" and Imagine Films' "Liar Liar" and "The Nutty Professor."
Despite being one of the best-reviewed movies of the year, the June release "Out of Sight," a $48-million action-comedy romance with George Clooney and Jennifer Lopez, performed weakly at the box office with less than $40 million domestically.
Universal executives privately admit it was a bad call to slot the movie into June as a summer filler when the stylish genre film was better suited for a fall release.
Every studio hits cold spells. Warner Bros. hasn't been able to dig its way out of the box-office ditch it's been in for some time now, and its latest disaster, "The Avengers," will lose tens of millions. But Universal's cold spell has been especially long and painful, particularly since Seagram Co. plunked down $5.7 billion for 80% of Universal Studios in 1995.
Not one Universal movie has so far this year grossed more than $40 million in the U.S.--a list that includes such expensive duds as "Primary Colors," starring John Travolta, and "Mercury Rising," starring Bruce Willis, preceded by last year's big-budget misfires "Dante's Peak" and "The Jackal."
So it's no wonder that Universal's management is being watched closely by Seagram chief Edgar Bronfman Jr. and his Universal Studios Chief Executive Frank Biondi Jr.
Executives at Universal declined to be interviewed, citing Seagram's quiet period until its acquisition of music giant PolyGram is finalized in late October.
Despite Universal's protracted box-office slump, Bronfman has stood behind the 42-year-old Silver, who for the last three years has been responsible for the movie division. In February, Universal Studios President Ron Meyer--whose stability at the studio also continues to be the subject of speculation--extended Silver's contract until 2002.
This spring, the ax fell on three of the studio's senior movie executives: production President Marc Platt, and two days later, marketing chiefs Buffy Shutt and Kathy Jones.
Last year's slate was littered with flops that included "For Richer or Poorer," "Leave It to Beaver," "Kull the Conqueror," "A Simple Wish" and "The Boxer," although "The Lost World" and "Liar Liar" made up for a lot of sins by making so much money.
Silver has said he needs time to get the studio back on track after losing Spielberg and his Amblin Entertainment as a key supplier of product and after being disrupted by the change of ownership and management three years ago.
A year ago, he told The Times, "It's been a time of humongous transition. I've been trying to turn this battleship around."
To help stem the bleeding, Universal has been trying to manage its risk as much as possible in a business that is notoriously volatile and low-margin. Since Biondi joined the company 2 1/2 years ago, the studio increasingly has relied on other parties to put up production capital.
Historically, Universal has spent more in its movie sector than in any of its other core businesses, which include TV, theme parks and music. Biondi has stated that the target is to reduce Universal's annual film commitment of nearly $1 billion by 20% to 50%. The idea is to scale back the number of movies the studio finances on its own to around 12 to 15 a year, laying off as much risk as possible through off-balance-sheet financing or partnerships with producers and studios.
Universal also is bent on changing its mix of pictures, producing considerably fewer high-concept movies that cost $20 million to $40 million (which used to comprise 75% or more of its slate) and more bigger-budget, star-driven vehicles (four to eight) than it had in the past.
One studio insider said that Silver had long resisted the strategy of working with self-financing producers but has since acquiesced.
However, all of Universal's upcoming '98 movies were entirely financed by the studio and represent a significant amount of production and marketing dollars.
Sources said "Meet Joe Black" went over budget to nearly $90 million. Likewise, the "Babe" sequel shot way past its planned wrap date and was also surprisingly expensive at a price north of $80 million--more than triple the cost of the $25-million original.
Gus Van Sant's near shot-by-shot remake of "Psycho" was considerably cheaper at $25 million.
On those films rests Silver's hope that the days of bread and water are nearly over and champagne days lie ahead.
Exhibitor Relations Co. contributed statistical figures to this report.