New U crew might have to fight for Imagine, Working Title
By Josh Young
Even as Universal Pictures� recently installed chairman Marc Shmuger and co-chairman David Linde go about the workaday tasks of assembling and managing the current slate of films, they are facing a critical year for the studio: 2008.
By New Year�s Eve �08 the studio�s deals will have expired with its two most prolific producers, Imagine Entertainment and Working Title. Hollywood translation: Over the next few months, these relationships must be shored up as negotiations begin.
The defection of either Imagine or Working Title would put a hole in Universal�s future slate at a time when the company can ill afford it. Universal had long distributed DreamWorks� films, but lost them last year when Paramount snatched DreamWorks away. That took 4-6 films out of Universal�s yearly hopper, meaning the studio has extra work to do even now to fill its DVD, cable and other ancillary distribution streams. This and other factors ups the ante with Imagine and Working Title. One agency head calls the two companies �critical� to Universal�s future output.
Is it too early for the Shmuger/Linde regime soon to be thinking about this? �Everything seems to be set two years in advance�Two years in advance requires less Tums,� the agency head says.
Imagine, led by producer Brian Grazer and director Ron Howard, has produced more than a dozen films for Universal in the last seven years, and those films have grossed over $1.1 billion domestically. The high-points were the Oscar-winning �A Beautiful Mind,� �8 Mile� and �The Grinch.�
Working Title, run by producers Tim Bevan and Eric Fellner, has also been a prolific producer for Universal, recently delivering �Pride & Prejudice,� �Nanny McPhee� and the delicate �United 93.� Importantly, the company�s films tend to have modest budgets and perform well overseas. �Pride & Prejudice,� for example, grossed $38 million domestically and $116 million worldwide.
The foreign cache of Working Title will become more crucial to Universal in the wake of the dissolution of UIP, U�s international distribution partnership with Paramount, at the end of this year. The breakup leaves each studio looking for ways to build a powerful overseas operation, which means both could wind up interested in Working Title. The addition of Working Title would be a coup for Paramount boss Brad Grey who has, beyond attracting DreamWorks, enhanced Paramount Classics by splitting the label into two budget-sensitive divisions.
While Imagine�s contract is up at the end of �08, Working Title�s is even more time sensitive: It�s up in December �07. Right now, the company is moving full steam ahead on several films for Universal, including Joe Carnahan�s �Smokin� Aces,� Ed Wright�s �Hot Fuzz,� �Bean II,� and �The Golden Age,� Shakur Kapur�s follow-up to the Oscar-nominated �Elizabeth.�
�In a strange way, Working Title would be a bigger loss (for Universal than Imagine) because it is such a reliable producer of mid-level films that can fill out the slate and have break-out potential,� explains one studio producer. �Their deal is also less expensive on the back end.�
Imagine has one of the richest producing deals in town. The company�s standard producing fee is $2 million per film against 7.5 percent of first dollar gross, according to senior studio execs. That backend is at the top end of the producer�s spectrum, on par with Jerry Bruckheimer�s. Howard�s directing fee ranges from $10 million and $12 million plus first dollar gross, also among the highest in the industry.
Universal might need to sweeten the deal to keep Imagine. That could be tough to do in a time of escalating budgets. (Working Title�s Bevan and Fellner will also be looking for better terms.)
Imagine has enjoyed one of its greatest successes with �The Da Vinci Code,� the $642 million-grossing film which Howard directed and Grazer produced for Sony. The prequel, �Angels and Demons,� has already been put into development with the studio planning to bring Grazer back on board. Imagine also produced �Fun With Dick and Jane� for Sony, which grossed $200 million worldwide.
The company was able to produce and Howard was able to direct �The Da Vinci Code� for Sony because the company has two �outs� in its contract for Howard to direct elsewhere. However, according to one studio source, Howard now owes Universal his next movie.
The Universal-Imagine relationship has been a profitable and relatively harmonious one over the past decade. But relations were strained when last year�s �Cinderella Man� did not meet box office expectations. Universal also has a new production team in place. This means that as a new working dynamic is being established with both Imagine and Working Title over the next year, negotiations will begin on both companies� deals.
The first Grazer-produced Imagine film going into production under the new regime is �American Gangster,� which has been anything but an easy project. The studio pulled the plug on the multi-generational crime drama last year over script and budget concerns when Antoine Fuqua was directing. But the project has come back together in a big way with Ridley Scott directing Russell Crowe and Denzel Washington.
So what will happen? Neither Grazer, nor Universal nor Working Title wanted to comment on the situation. But the town is talking...and waiting.
�Both Imagine and Working Title are about getting movies done,� summarizes one veteran producer. �It will be interesting to see what happens to both of them. I could see the Working Title guys at Paramount or Sony, and I could see Imagine at Sony. I can also see both of them staying at Universal with much better deals.�
