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COMPANY TOWN : THE BIZ / CLAUDIA ELLER

Lower Costs Energize 'Trek' Film Profit

December 11, 1998|CLAUDIA ELLER

Paramount Pictures, whose ninth installment of the long-running and highly lucrative "Star Trek" movie series lands in theaters today, has the secret to sequel success: Make 'em at a price.

While their box-office grosses and special effects may be dwarfed by such high-octane contemporary blockbusters as "Independence Day" and "Men in Black," the "Star Trek" movies cost about half as much to make and continue to be extraordinarily profitable for Paramount.

The studio, owned by Viacom Inc., has hauled in billions of dollars in revenue from the myriad movies, TV shows, home videos, consumer products, interactive games, collectibles, books and comic books and theme park attractions spawned from the popular sci-fi franchise that was created 32 years ago by the late Gene Roddenberry.

Eight movies have collectively grossed nearly $1 billion in worldwide box-office revenue; Paramount got about half. "Star Trek" videos have sold more than 50 million cassettes worldwide, which in gross receipts exceeds $1 billion. Four prime-time series during the last 30 years have generated $2.3 billion. And retail sales have exceeded $3.5 billion. Studios usually get a 10% royalty from product sales.

Publishing accounts for another huge chunk of revenue, with 50 titles published every year and about 500 during the last three decades. According to Paramount's licensing division, 13 "Star Trek" books are sold every minute in the U.S. There are myriad comic books and fan magazines, not to mention the theme park attractions.

"It's a great franchise that keeps renewing itself," said Viacom Entertainment Group Chairman Jonathan Dolgen. "There's a great loyal audience, and it's a big piece of business for us."

On the movie front, "Star Trek" is one of the longest-running series in cinema history next to James Bond, which remains the most lucrative.

With the core movie audience for the "Trek" films being males over 25, Paramount executives said the fan base for the series continues to grow and has picked up overseas, where it has not historically performed as well. The studio has stepped up its marketing in foreign territories, with Britain and Germany "Star Trek's" strongest markets.

"We can feed the existing fans and grow new fans with the movies as long as we keep them creatively interesting, which has always been the 'Star Trek' strategy," said Rob Friedman, vice chairman of Paramount's motion picture group.

Sherry Lansing, Paramount movie chairwoman, attributes the perennial popularity of the "Trek" films to their being "very imaginative and original with unique characters going back to Spock." (Lansing is on the board of Times Mirror, the parent company of the Los Angeles Times.)

She said that another appealing aspect is that the films espouse "very positive values--they're not ugly or mean-spirited." While many sci-fi movies tend to have a bleak point of view, Roddenberry's vision of the future is uplifting and hopeful.

But the real key may be financial. Unlike other major studio sequels whose budgets commonly double, triple and in the recent case of Universal Pictures' "Babe" movie even quadruple the previous film, Paramount has kept costs firmly in line.

"On the production side, I think we deliver half or a little more than half the cost of similar look and feel movies," Dolgen said.

Not that its costs haven't continued to increase since the first "Star Trek" movie was beamed up in 1979.

"Star Trek: Generations," released at Thanksgiving in 1994, cost just $25 million, grossing $75.5 million domestically and an additional $44 million internationally.

The most recent sequel, "Star Trek: First Contact," released two years ago, cost in the mid-$40-million range and grossed $95 million in the U.S. and $58 million in foreign territories. At $153 million worldwide, it's the highest-grossing "Star Trek" movie to date.

"Star Trek: Insurrection," which opens today, cost about $65 million. More than half of the increase over the previous production was the cost of its stars. The remaining overages are attributed to the general increase in the cost of production over the last two years.

The "Star Trek" movies are modestly priced compared with other big special-effects movies and studio sequels.

For example, "Babe: Pig in the City" cost more than $100 million to produce, and Warner Bros.' "Batman and Robin" and 20th Century Fox's "Speed 2: Cruise Control" cost far more.

When movies such as "Babe" or "Speed 2" miss--as both did--it represents a significant loss to the studio that produces and markets it.

Not having to pay huge star salaries has helped Paramount keep above-the-line production costs under control. Only one of the actors, Patrick Stewart--who plays Capt. Jean-Luc Picard--is guaranteed a small piece of the profit.

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