Roth Seeks to Keep Revolution Going

Joe Roth is down to two hours’ sleep a night.

Movie previews and marketing meetings at his Revolution Studios are squeezed into Sundays to fit his schedule. The rest of Roth’s week, nights included, belong to directing the comedy “Christmas With the Kranks” starring Tim Allen and Jamie Lee Curtis.

On top of that, he would love to be asked to produce next year’s Oscars, as he did for the show in February.

Roth can’t rest for other reasons, not the least of which is that he must soon shore up the future of his Santa Monica-based company. He once saw Revolution as something with a finite life that would be extinct by the end of 2006, when, presumably, the former Walt Disney Studios and 20th Century Fox chief would be back in the executive suites running Sony Pictures Entertainment.

That isn’t going to happen. And Roth has resolved to stay a producer and director, making Revolution a fixture.

“My hopes are to keep it going forever. I know I’ve never declared that and I should,” Roth said in an interview.

To do that, Roth will need a wad of money. It remains to be seen whether his current group of financial backers -- Sony Corp.’s Sony Pictures Entertainment, News Corp.’s Fox Entertainment and Liberty Media Corp.’s Starz Encore -- can be persuaded to write the kind of check he wants and give him the extraordinary freedom he now enjoys.

Revolution’s bumpy history -- duds such as “Gigli” and “Hollywood Homicide” offsetting successes including “XXX” and “Anger Management” -- doesn’t make it easy.

“I think we’d better perform better before we try to extend,” Roth said. A renewed arrangement with principal backer Sony, he said, would depend entirely on “our success and their desire.”

In theory, Roth has plenty of time. Revolution’s deals with Sony and the other investors don’t expire for more than two years. But in Hollywood, complicated financing deals need to be negotiated well in advance to allow for protracted talks and to avoid filmmaking disruptions. Without a new deal soon, Revolution might have to slow its search for projects.

Key to Roth’s future will be how much more money Sony wants to invest in his company. Sony now owns 7.5% of Revolution, Fox has a 2.5% stake and Starz Encore has 15%.

The Revolution deal is unusually rich even by Hollywood standards. Sony puts up 42.5% of the money to make the movies and all the money to market them -- spending an estimated $1.6 billion to date -- and Revolution keeps the copyrights. Forbes magazine once described the arrangement as the “Best Deal in Tinseltown.”

Sony Pictures Chairman Michael Lynton acknowledged that Sony lost money in 2003 on the Revolution arrangement.

But overall it remains profitable, Lynton said. “We are ahead of the game. Right now, everyone at Sony is genuinely happy with the relationship, and all things considered equal, we would like to find a way to continue that relationship because we find it works for us.”

That Roth, 56, wants to make Revolution permanent marks a distinct shift for someone who has spent most of his career as a star studio executive.

That track record suggested that he was biding his time in the executive bullpen until the top job at Sony opened up. But in a surprise move, Sony brass in December instead named Lynton, once Roth’s subordinate at Disney, to replace the studio’s retiring chief, John Calley.

As a producer, Roth and the 55 Revolution employees have been prolific in a business in which droughts are common. Revolution has already released, produced or put into motion the minimum of 36 films it is obligated to supply investors. On Wednesday, Revolution’s “White Chicks” starring brothers Shawn and Marlon Wayans opened to brisk business. The firm’s other two 2004 releases, “Hellboy” and “13 Going on 30,” performed well.

Last year, however, was especially painful. A string of its films was skewered by critics and flopped with moviegoers. Besides “Gigli” and “Hollywood Homicide,” other costly busts were “The Missing” and “Tears of the Sun.”

According to Roth, the films’ weak showings derailed plans he and Revolution executives cooked up over dinner.

Seated on the patio of Santa Monica’s Buffalo Club, the group -- which included Revolution principals Tom Sherak, Rob Moore and production head Todd Garner -- agreed to remain in business together for five more years past 2006. Roth planned to approach Sony and the other investors about renewing the deals by year-end.

Roth now hopes to open talks with Sony by the beginning of next year. He said Sony was his company’s linchpin because it distributed the movies theatrically and on DVDs.

Under the Revolution deals, Roth said, Sony and the other investors are required to back any film Revolution starts shooting by the last day of 2006. He said the tally could reach about 45 titles. Many will be comedies, including “Are We There Yet?” with Ice Cube and “Click” with Adam Sandler.

In addition to collecting a 12.5% distribution fee, Sony has an incentive to keep Revolution in its fold given that the company last year provided nearly half of Sony’s film slate, freeing its creative team to focus on big event movies such as its “Spider-Man” series. Sony movie chief Amy Pascal said that before the Revolution deal, Sony was “making too many movies -- over 20 a year,” compared with nine to 12 now.

“It has allowed us to be smarter about our choices and keep the distribution machine going,” Pascal said. “It’s very advantageous for our company.”

Industry buzz among executives says Roth isn’t likely to duplicate the dream deal he made in the heady days of 2000, even if Sony and the other partners extend their deals.

Tom Southwick, senior vice president of communications at Starz Encore, which invested $150 million in Revolution for domestic pay TV rights, said: “We have a good relationship with them. We’re a strategic investor as well as a financial investor.”

Executives at Fox, which invested $25 million for broadcast, cable and domestic TV syndication rights, declined to comment. But one senior Fox executive privately said the company would be unlikely to make a similar deal given today’s tougher realities in TV.

Also unsettled for Roth is the finality of his divorce from Donna Arkoff Roth, requiring a high-stakes division of assets, including a substantial piece of Revolution. California laws dictate that assets accumulated during a marriage generally belong to both spouses. Roth owns 62% of Revolution.

According to court papers, Roth and his wife, a producer with a deal with Revolution, are working on a property settlement in ending their 22-year marriage.

Said Roth, “I feel confident that nothing in our unfortunate divorce would prevent Revolution from going forward.”

He acknowledged that he was taking on such a hectic schedule because “I was going through a tough time personally, and I’ve always found solace in work.”

Four years after cutting his lucrative deal, Roth admits market conditions have changed.

“I don’t have expectations,” he said. “I want the company to run until people are no longer interested in doing business with me.”