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Movie Biz 101 for Anschutz

The financier is on an expensive learning curve in his mission to deliver family entertainment

August 02, 2004|Claudia Eller | Times Staff Writer

In late June, a few days after billionaire Philip Anschutz's big-budget movie "Around the World in 80 Days" had crashed at the box office, his top two film lieutenants sent a buck-'em-up e-mail to their dispirited troops.

"While the overall performance of '80 Days' is unfortunate, it will have no impact at all on our ambitious development and production plans," the executives assured Anschutz Film Group staffers. "We will learn from this experience and move on to better commercial success in the future."

That sense of determination and destiny has made Anschutz a very rich man in such realms as real estate, pro sports and oil. But success in Hollywood is another story.

"Phil Anschutz is an extraordinary businessman and financier, but we've yet to see him demonstrate that he has a full understanding of the complexities and risks of the motion picture industry," said Christopher Dixon, a managing partner at investment firm Gabelli Group Capital Partners.

Anschutz and those watching his march into the entertainment industry will get another chance to measure his acumen when two more of his expensive movies make their way to theaters next year. The first is "Sahara," a $130-million-plus action adventure that is based on Clive Cussler's 1992 novel and has just completed production. The other is a $150-million adaptation of C.S. Lewis' children's classic "The Chronicles of Narnia: The Lion, the Witch and the Wardrobe." It is being shot in New Zealand.

Anschutz, whose vast holdings include Staples Center and the Los Angeles Kings hockey team, knows that his learning curve may be as steep as the Rockies that tower over his Denver headquarters. Although Anschutz does not grant interviews, he recently alluded to the difficulties during a speech at a Florida college.

"The movie business is not a very good business in many ways," he said. "No one with any sense would get into it. My friends think I'm a candidate for a lobotomy, and my competitors think I'm naive or stupid or both."

But Anschutz, who is worth an estimated $5 billion, also said he was interested in more than money. "If we can make some movies that have a positive effect on people's lives and on our culture, that's enough for me."

Anschutz, in fact, is on a mission to cleanse movies of sex, foul language and violence, risking hundreds of millions of dollars to deliver family fare with uplifting messages. But it's the scale of his ambitions -- moving from smaller movies to risky big-budget affairs -- that has many in Hollywood questioning whether he's headed for the same humiliation suffered by so many other wealthy entrepreneurs who've come to town with dreams of conquering the movie industry.

In April, amid several management changes, Anschutz brought in his attorney and movie business advisor David Weil to streamline and strengthen the Beverly Hills film operations as chief executive of the new Anschutz Film Group.

"We're now in a position," Weil said, "to sharpen our focus and achieve both of Phil's goals: to prosper as a company and inspire our audience."

Although the film operation is committed to investing heavily on some projects, Weil said, the budgets for most will average $30 million to $35 million. Among the more moderately budgeted films is director Taylor Hackford's upcoming $40-million biographical drama "Ray," starring Jamie Foxx as legendary musician Ray Charles.

Known as a contrarian investor, Anschutz began venturing into entertainment in 2000 and 2001 by snapping up financially troubled theater chains at fire-sale prices. He bought three bankrupt companies -- United Artists, Edwards Theaters and Regal Cinemas -- and created the largest chain in the country, Regal Entertainment Group, now operating at a profit.

Around the same time, Anschutz launched his first production company, Crusader Entertainment, since renamed Bristol Bay Productions. He also linked up with Walden Media, which was started by former Dimension Films executive Cary Granat.

The two companies, now united under Anschutz Film Group, have made a dozen films, of which half have been released, with mixed results. The most profitable was last year's lower-cost family hit "Holes," which was distributed by Walt Disney Co. and grossed $67 million.

Anschutz also started thinking stratospherically, deciding to finance a remake of United Artists' "Around the World in 80 Days," which won an Academy Award in 1956 for best picture. For Anschutz, the film embodied the sort of wholesome and fun entertainment he believed audiences were craving and needed.

He was so determined that he began production without having a partner signed up to distribute the film -- a highly unusual move, especially considering a cost that was escalating beyond $100 million. Paramount Pictures originally had planned on co-financing "80 Days" but backed out over the choice of some creative elements and the direction of the script.

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