Columbia’s Deal With Writers Riles Its Rivals

The top executives at Sony-owned Columbia Pictures are as unpopular with rival studios right now as they are popular with top screenwriters in town.

Although most competitors are furious with Columbia’s decision last week to give top-drawer screenwriters a percentage of the gross revenue from their movies, not one has had the nerve to complain directly to studio President Amy Pascal.

Nor have they been willing to go on the record with their strong opposing views, for fear of offending the very screenwriters with whom they want to do business. But there’s no doubt they don’t want to share more of their profits than they already do.

“Without writers, we’d have nothing,” Pascal said. “They’re the foundation of the movie business.”

The naysayers view Columbia’s move to pay qualified writers 2% of the gross receipts on their movies to be as nettlesome as the 1995 can’t-turn-back decision by the studio’s prior regime to pay Jim Carrey an unprecedented $20 million to star in a film. The Carrey decision drove up the cost of movies overnight, and many expect the latest action to do the same.

Competitors say it’s not that writers don’t deserve to share in the success of their movies, along with studios, stars, directors and some producers, but that there just isn’t enough profit to go around.

“It’s like somebody talking about buying a big house in the middle of a depression,” said one. “At a time when all the studios are looking at intelligent ways to cut costs and reduce gross participations, why make an announcement about an all-time-high payment--it’s kind of counterculture.”

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The head of another studio said: “The reason people were so stunned was it comes at the absolute worst period in the film business. . . . The movie business doesn’t make any sense. More and more movies lose more and more money than ever before. Most companies are staggering with unacceptable losses, and some owners are considering getting out of the business.”

Another top studio executive suggested that Columbia’s deal “is going to force us to take more chances on newer, less expensive writers.”

The Sony-Columbia brass and their supporters are less bashful about speaking publicly.

“Who are we kidding here? It’s such hypocrisy,” said Sony Pictures Chairman John Calley, who felt compelled to respond to the controversy while recuperating at home from surgery.

“There is vast production and overhead waste in the movie business, and there are ways to create efficiencies like digitizing production and distribution,” Calley said, adding that “having no ceiling on executive compensation” and maintaining too many first-look and overhead deals also add unnecessarily to studio costs.

“But the real nuts and bolts of our business is the generation of material we base our pictures on,” he said. “And writers are primarily responsible for that.”

Pascal estimates that based on a study done in 1997, about two-thirds of the studio’s movies are generated by screenwriters--in the form of both scripts and pitches--with the remainder based on literary properties, comic books and cartoons, TV shows, plays, franchise sequels and life rights.

Calley contends that success in the movie business is all about making the right choices about whom to do business with, what projects get made and how they get executed.

He said some of those complaining have made one disastrous movie after another. “The idea that we’re doing something to destroy the business is bull. What’s damaging to the movie business is picture choices,” he said, acknowledging that Columbia is not immune to flops.

Two of Hollywood’s most successful producers, Scott Rudin and Brian Grazer--both of whom get a percentage of gross receipts on the movies they make--said they take their hats off to Columbia.

“The magnet for movie stars is scripts,” said Rudin, who has produced such box-office hits as “The Truman Show” and “Sister Act.” “Columbia only has to pay a premium to writers in success . . . and we’re talking about a nick--not even a dent.”

The studio won’t have to distribute profits to writers until after it recoups all its production and marketing costs.

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For instance, if a movie costs $100 million to produce and market, and the revenue to the studio from all sources--including theatrical, video and television sales--amounts to $150 million, the writer will get 2% of $50 million, or $1 million.

“Is that so bad for the person who probably came up with the idea?” Pascal said. “What the writer makes is a fraction of what is already being paid to actors and directors.”

Grazer, whose box-office hits include “Liar, Liar” and “The Nutty Professor,” said Columbia’s gesture to writers is “really smart because even though in the art form writers are considered the highest on the food chain, sadly the inverse is true when they get paid.”

Columbia has also come under fire for helping to create Hollywood’s latest “power” list of more than 30 top screenwriters to whom the studio extended the deal and from whom it extracted a one-script commitment each over the next four years.

The genesis of the list came about when an informal group of writers, including Phil Alden Robinson, Nicholas Kazan, Tom Schulman, Ron Bass and Frank Pierson, fought to get writers a percentage of profits.

After pounding out the details of a deal at Columbia over a six-month period, with the help of attorney Alan Wertheimer, the writers submitted to Columbia a list of 60 to 75 names of other writers they had access to as part of a group that meets regularly. Columbia then chose some of the submitted names and added others.

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Naturally, some top screenwriters in Hollywood--a place obsessed with power lists--who were left off the list are bent out of shape.

“We weren’t trying to create an exclusive club,” Kazan said. “We tried to keep the size of the list as small as possible so as to limit the number of people who’d have an obligation to Columbia.”

Pascal said there were certain screenwriters “we asked to be on the list who didn’t feel comfortable being part of a group thing.”

The Columbia president is upset that “people have mistaken this list for something it’s not. These people agreed to make a sacrifice for lots of other writers.”

Screenwriters not on the list can qualify for Columbia’s 2% gross deal (1% for shared credit) if they’ve been guaranteed $750,000 for a writing assignment or have received $1 million for a spec script or been nominated for an Oscar or Writers Guild of America award.

Wertheimer has estimated that about 300 screenwriters qualify.

“People not on the list get all the benefits of the back-end deal,” said Gareth Wigan, co-vice chairman of Columbia, and they are not obligated to give the studio a script in the next four years.

One rival studio chief said he resents Columbia making what is akin to a collective-bargaining agreement with writers.

“This was a class-action event where an entire industry’s pay scale was changed . . . and I don’t go for anything in the business where rules are stipulated,” he said, noting he’d rather have the option to pay writers a percentage of profit on a picture-by-picture basis, which he and other studios do occasionally.

Wigan said he and his colleagues at Columbia are “conscious that this generates upward pressure--in that producers may now turn around and ask for more money--but the choice is the studio’s . . . and other studios are not obligated to give away 2% of the gross.”

Wertheimer said the deal gives Columbia a competitive edge at the moment, but “eventually other studios will have to meet writers’ quotes and figure out how to give the gross and where to take it from.”

John Goldwyn, president of Paramount Pictures Motion Picture Group, said he doesn’t view Columbia’s action as good or bad. Rather, he said, “it was inevitable for Hollywood. People have been cutting into the profits pie for a long time, and inevitably writers were going to get a gross participation.”