Hollywood: Will There Ever Be a 21st Century-Fox?

A PHONE call jolted awake Paramount Senior Vice President Robert Evans at 4 o'clock one morning last fall. Walter Matthau was on the line--and on the rampage--from the Long Island location of A New Leaf. According to Hollywood Columnist Joyce Haber, Matthau yelled: "If you don't get Stanley Jaffe off this picture, I'm leaving. Who is this twirp?" What, Evans asked, seemed to be the trouble between Walter and the 29-year-old who had just taken over as producer? Matthau explained that while shooting, "I had to go to the bathroom, and Jaffe ordered, 'Finish the scene first.' For God's sake," Matthau spluttered, "I'm the star!"

That, as Matthau now knows, was 1960s talk. Hollywood is at high noon. Stanley Jaffe has leapfrogged over Evans to become chief operating officer at Paramount. The high-priced stars are being cut down to size, and the masters of business administration are taking over the studios, or what is left of them. A new generation of film-company executives are suddenly trying to cope with economic realities that their fathers and uncles refused even to recognize. During the past few years, for example, 20th Century-Fox wasted a great deal of thought on whether and when to change its name to 21st Century-Fox; meanwhile disastrous pictures like Star! and Dr. Doolittle were costing --and losing--millions of dollars.

The nub of the problem is that TV is not going away and people are not going to the movies. Since the 1940s, the population has increased 30%; admission prices have doubled since 1959. Yet last year the box-office gross was 24% less than in 1946. At a time when Hollywood is producing work of greater artistic interest, the studios seem to have lost their moneymaking touch.

Wharton School. In 1969, five of the seven major film companies were in the red and, together, lost more than $100 million. Inevitably, conglomerate wheeler-dealers and proxy challengers have moved in, trying to cash in on such assets as film libraries and real estate. Gulf & Western Industries took over Paramount; Transamerica Corp. and Kinney National Service bought out United Artists and Warner Brothers.

The Stanley Jaffe generation goes into office under siege. However successful, it will go out unsung. It lacks the superstar quality of the Goldwyns and the Mayers and the Cohns. As quote makers, include the Jaffes out. Their English is more grammatical than that of their forebears, but hardly as flavorful. Jaffe, for example, polished his at the University of Pennsylvania's Wharton School of Finance.

The mandate is to bring moviemaking into the computerized, cost-controlled business world. The newest enthusiasm in Hollywood film making, therefore, is cutting budgets and cutting losses. Some of that $100 million debit was just a realistic write-off or write-down on properties in the works or even in the can that could never net as much as originally projected. In November, the last tycoon of old Hollywood, Jack Warner, retired from the studio bearing his name. But even before his formal send-off (on Sound Stage No. 7, where the "Great Hall" set from Camelot is still unstruck), 45 of Warner's 62 pending projects were unceremoniously jettisoned. In the old days, a major studio would shoot as many as 50 pictures a year. In 1970, the average will be closer to 15.

The flop percentage is the same for little movies as for blockbusters--about 70%. The Hollywood rule of thumb is that a picture must gross 2 1/2 times its cost to break even. As Warner's President Ted Ashley puts it, "If you get hurt with the $15 million films, you get de-balled." Though his $20 million Hello, Dolly! may nose into the black eventually. Fox Board Chairman Darryl F. Zanuck confesses that he would be some kind of nut to launch such an extravagant film today. "Once you're over the $4,000,000 category," he figures, "you're sticking out your chin." Paramount and MGM are, with few exceptions, enforcing a $2,000,000 limit.

No Star. That sort of economic discipline was thought impossible until last year, when the Peter Fonda-Dennis Hopper production, Easy Rider, hit Hollywood the way the Volkswagen hit Detroit. Shot on a starvation budget of $400,000, the film is expected to gross $30 million--a reminder that people 30 and under account for 75% of the U.S. box office.

The Easy Rider belt is tightening around the necks of prima donna producers and directors with a record of bringing pictures in late and overbudget. Blake Edwards, whose The Great Race came in at 100% over, and his wife Julie Andrews, no longer surefire box office since Star!, are reportedly being paid a $1,000,000 settlement by MGM not to shoot their previously committed film, She Loves Me.

The economy wave is also washing out stars' salaries. The studios were emboldened by the success of The Graduate, which, without a big box-office name, has become the third-highsst grosser ($43 million) in history; Dustin Hoffman's pay for that film was $20,000. On the other side of the coin, Mike Frankovich, a former production chief at Columbia, recalls how "Universal failed three times with Shirley MacLaine, yet still gave her $800,000 plus a percentage for Sweet Charity." Sweet Charity went sour, and Shirley has not been swamped with offers. Similarly, Peter Sellers, who has commanded up to $ 1,000,000, got $50,000 and a small percentage for his last picture.

With money as tight as it is, stars are increasingly being talked into sharing the risk and, in effect, bankrolling their own pictures. Frankovich persuaded Sidney Poitier to work for nothing "up front" but 10% of the gross in To Sir with Love. Poitier's take is $2,000,000 already and should hit $4,000,000. Natalie Wood, once around the $750,000 level, turned down a similar deal in Bonnie and Clyde, then last year came around on Bob and Carol and Ted and Alice; she won't be sorry.

The established stars must face up to other adjustments, too, with the industry's new orientation toward youth. "The older stars are going to have to play older roles if they want to work with us," says MGM President James Aubrey. "We can't make a picture with I Burt Lancaster and Deborah Kerr groping with each other any more. That's obscene. It's like watching a couple of grandparents pawing each other." That even goes for Liz Taylor.

What Holidays? If any single man personifies the violent change in Hollywood, it is Aubrey, who in October became MGM's third president in eleven months. They called him "the Smiling Cobra" when he was president of CBS-TV from 1959 to 1965, and at MGM he is to be the new broom--or ax. The company he took over was in paralysis after three years of proxy battles and within four weeks was to report the $35 million loss for 1969. Part of that deficit, though, was accounted for by the cancellation of 15 films in progress that Aubrey decided were poor box-office risks. He killed an adaptation of Andre Malraux's Man's Fate after $3,000,000 and three years out of the life of Director Fred Zinnemann had been invested in it. Under Aubrey's "streamlining" program, MGM's 183-acre Hollywood studio is now considered just real estate. Five out of every six movies nowadays are shot on location; so he would like to sell off all but one of the five lots and the Irving G. Thalberg administration building. More than 20 of 32 domestic sales offices are to be closed, and Aubrey's first priority has been to reduce the payroll overall by 40%. Wouldn't it be decent to wait until after the holidays? asked one top aide last fall. "What holidays?" snapped Aubrey.

Staffing plans and market strategy of the Aubrey regime are all pinned to youth. He will probably not be employing Producers Martin Ransohoff and Carlo Ponti (two of whose projects he dropped), he says, until "they can put their heads in the right place." Translation: until they learn to operate within lower budgets. Aubrey's commitments include the next two Beatles pictures, one on groupies, plus an adaptation of Abbie Hoffman's Revolution for the Hell of It. To reach the kids, Aubrey plans to shift the emphasis of MGM promotion efforts and advertising from standard newspapers to underground weeklies and radio.

The younger generation's fascination with films is Hollywood's greatest hope --and challenge. As in other aspects of life, the kids are demanding a new honesty in film-making that has nothing to do with the size of the budget. Michael Campus, 28, former director of specials at CBS, explains: "Young people are saying that it's a crime to spend $20 million on Paint Your Wagon. That amount could remake a city." Perhaps in getting right with the new audience, Hollywood will not only save its head, but its own soul.

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