Top talent manager and producer Brad Grey arrives March 1 as the new chairman of Viacom's Paramount Pictures, replacing industry veteran Sherry Lansing. His priority is to restore the studio's luster, tarnished by a prolonged box-office slump and management upheaval....
Brad Grey
Paramount Pictures
5500 Melrose Ave.
Dear Brad,
I'd congratulate you, it being your first day on the job, but I suspect you got enough air kisses at Brian Grazer's party the other night to last a lifetime. Until we get to meet in person, I thought I'd take the opportunity to pass along some free advice. (It's what columnists do -- we kibitz.)
You've probably noticed that you've inherited a second-division team. In terms of Oscars, you have to go back to 1998 to find a Paramount film ("Titanic") in the winner's circle. ("Titanic" was co-financed with Fox.) Since then, while Miramax has earned 138 Oscar nominations, Paramount has barely broken out of single digits. The studio's revenues aren't looking so hot either. Paramount had a tiny 7% domestic market share last year. Internationally, you were dead last among major studios. Mel Gibson's "The Passion of the Christ" did almost as much business overseas as all your movies put together.
Talk about having nowhere to go but up! The news from Viacom's radio division was so bad last week that the business press barely noticed that the film division's profits fell 20%, which normally would be a story in itself. To be fair, the old regime left you with a trio of potential summer hits; a Tom Cruise-starring "War of the Worlds," an Adam Sandler comedy remake of "The Longest Yard" and a Cameron Crowe film that should be a favorite with critics. Their go-slow DVD policy, which has kept many of the best titles off the market, also gives you the chance for a quick boost in profits if you start pumping them into video stores.
Still, if I were you, I'd figure out what to do about the studio's foreign operations, which are something of a disaster area, especially since the old regime's policy of selling off most of the foreign rights to the studio's films came at the very time that the overseas market was exploding. At some studios, foreign now accounts for 60% or 65% of their theatrical business. At Paramount, the studio focused on domestic theatrical, which is the part of the business that's not growing at all.
