Specialty isn't its specialty

IT'S AN open secret in Hollywood that Warner Bros. is totally clueless about the independent film business. The studio's Warner Independent Pictures division has been a perennial also-ran, having released a string of films over the last two years that has largely disappeared without a trace. Warner finally acknowledged the obvious, announcing Thursday that it was closing both of its specialty divisions, Picturehouse and Warner Independent Pictures.

According to Warner Bros. President Alan Horn, with the studio having just absorbed New Line Cinema, which had overseen Picturehouse, it decided that it was redundant to have separate entities releasing films when everything could be marketed under the big Warner Bros. studio umbrella.

"We haven't thrown in the towel," Horn told me Thursday. "If there is a specialty movie that interests us or we find something we want to buy, we'll still do it. But marketing is marketing is marketing. I don't think you need a specialty label to market a specialty picture. The tools just aren't that different. Take 'Juno.' In my view, its success wasn't a function of whether it was at Fox or Fox Searchlight. What made it a hit was the movie itself, not the marketing."

Say what???

I couldn't be a bigger fan of Horn, who is a class act and a great businessman. But when it comes to the world of specialty films -- movies made for a minimal cost that contend for Oscars and don't feature superheroes and $100 million worth of special effects -- Horn couldn't possibly be more out to lunch. Fox Searchlight, widely acknowledged as the premier specialty division in the business, has been a huge success story, whether with "Napoleon Dynamite," "Little Miss Sunshine" or "28 Days Later," precisely because it has its own marketing and distribution staff, all with a keen insiders' knowledge of what it takes to promote the kind of distinctive films that would be lost inside a big studio marketing machine.

It was telling that when I asked Horn the other day to cite an example of a specialty movie that big Warner could successfully market, he offered up "Driving Miss Daisy" and "Million Dollar Baby," two star-driven Oscar winners -- one genteel, one gritty -- but each made by filmmakers with a long history of mainstream Hollywood fare.

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Autonomy was needed

The real reason Warner is anesthetizing its specialty divisions is because it has never understood the specialty business. The studio was the last major to start a specialty company, forming WIP in 2003, two years before New Line launched Picturehouse. Even worse, Warner never gave WIP the one thing every specialty division needs to survive: autonomy.

WIP's first boss, Mark Gill, had tons of experience, having run marketing and publicity at Miramax for Harvey Weinstein, the man who invented what might be called the irascible genius model of specialty filmmaking. But Gill clashed with Jeff Robinov, Horn's second in command, over a variety of autonomy and personality issues, making a quick exit. The studio's replacement was Polly Cohen, a solid Warner Bros. production executive with no experience in the specialty field. Her main qualification for the job seemed to be that she was a trusted Robinov lieutenant who understood the Warner culture.

Many insiders believe Warner never had a strategic plan for WIP, which had recently released such box-office failures as "In the Valley of Elah" and "Snow Angels." The company existed in part because Warner had a number of powerful filmmakers --notably John Wells, George Clooney and Steven Soderbergh -- who all had small-scale projects better suited for a specialty company than a studio.

The companies that've succeeded in the specialty business all managed to create their own indigenous culture. Some had dynamic leaders with a zealot's love for movies -- like Weinstein and Sony Pictures Classics chiefs Tom Bernard and Michael Barker. Others had a strategic studio-wide model, like the one that exists at Fox Searchlight, a division run by Peter Rice but launched by Tom Rothman, who now runs its parent movie studio.

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So was patience

Big studios have distinct personalities too. Disney specializes in family films. Sony is great with broad comedy. 20th Century Fox has an uncanny ability to market disposable schlock. Warner is Hollywood's version of an ad agency -- it markets tent-pole brands such as "Batman," "Superman" and "Ocean's Thirteen" -- no studio has managed a franchise better than the way Warner has handled "Harry Potter."

But that very brand orientation made it hard for Warner to appreciate the art of nurturing indie films. What studios love about their youth-oriented franchises is that they offer instant gratification. Studio hits make almost all of their money in the first four weeks of release. Specialty movies require passion and patience, two things Warner has in short supply.

Horn's belief that his studio machine could open "Juno" just as well as Fox Searchlight wildly underestimates the amount of arduous work that goes into building a specialty division hit. Look at the numbers. It took "Sideways," Searchlight's 2004 Oscar best picture nominee, 15 weeks to have its most successful weekend at the box office. At Miramax, "The Queen" didn't have its biggest weekend until 18 weeks into its theatrical run.

While it's true that Warner has had some success putting smaller films through its marketing machine, notably Clint Eastwood's "Million Dollar Baby," the studio has had more misses than hits. Last fall, the studio opened the George Clooney-starring "Michael Clayton" -- made for a modest $22 million -- like a mainstream picture, with a big TV ad buy and a roll-out on 2,450 screens. It was a disappointment. It needed the special care of a specialty division release.

Horn says he still wants to release films like "Pan's Labyrinth" and "La Vie en Rose," two recent Picturehouse releases shepherded to success by Bob Berney, a top-flight executive who was too much of a maverick to fit the Warner fold. "We still want to be a player -- we haven't thrown in the towel at all," says Horn. But he acknowledges that the specialty market is "a brutal business. It's just really overcrowded right now."

Without a strong advocate, movies like "La Vie en Rose" will die on the vine. And without a knowledgeable leader like Berney (the man behind such indie hits as "Memento" and "Y Tu Mama Tambien"), Warner will never be a player at the film festivals where studios acquire new independently financed movies. If you had a potential indie hit, with offers from a marketing powerhouse like Fox Searchlight and a cookie-cutter like Warner, whose offer would you take?

While Horn took full responsibility for the decision to shutter WIP and Picturehouse, it's no secret that Warner Bros. is under corporate pressure from Time Warner chief Jeff Bewkes to make more money. It's hardly a coincidence that the decision to fire hundreds of staffers at New Line and the specialty divisions comes at a time when Time Warner is trying to jettison AOL, spin off its cable business and may even be considering selling off its magazine division. Its remaining core businesses, movies and TV, are expected to turn bigger profits, even though they are in mature, slow-growth areas of the industry.

"Growth is challenging for us all," Horn admits. "So we're at least going to have to be as cost-efficient as possible so we can grow our profitability."

Warner is like a baseball team that's only signing superstar free agents instead of developing its own players, since for all its economic challenges, the specialty business has always been the best incubator for the next Martin Scorsese, Steven Soderbergh or Spike Lee.

Warners has clearly opted for brand over cinematic bravado -- its summer slate ("Speed Racer," "Sex and the City: The Movie," "Get Smart" and "The Dark Knight") is full of pre-sold franchises. It's a good way to make a lot of money, but it's not a way to make a lot of good movies.

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The Big Picture runs every Tuesday in Calendar.

E-mail questions or ideas to patrick.goldstein@latimes .com.

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