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Tuesday, February 7, 2012

Super Superbowl. CA Tax Credit Debate. English Language News for Hispanic Americans. Oscars Sold Out. MGM is Back? Lions Gate may Spin off "Juno" Pictures.

Natalie Portman accepts her Academy Award for lead actress for her performance in "Black Swan" at last year's Oscar ceremony.  Credit:  Al Seib / Los Angeles Times
From the LA Times Company Town Blog. Click here for the latest industry news.

The Oscars are sold out. Commercial time in this month's Academy Awards broadcast is a hot ticket.
Walt Disney Co. Chief Executive Bob Iger said Tuesday that the ABC network last week sold the remainder of its available advertising time — several weeks earlier than usual.

"There was demand for even more spots than allowed in [our] contract," Iger said in an earnings conference call with Wall Street analysts. Iger said the network squeezed in a few additional spots before it hit the contractual cap.

ABC fetched an average of $1.7 million per 30-second spot for the 84th annual Academy Awards broadcast on Feb. 26, a slight uptick from last year's rate.

The strong demand by advertisers bodes well for the Academy of Motion Picture Arts and Sciences, which relies on television revenue to stage its annual Oscar festivities as well as finance its operations.  Some observers have fretted that the field of nominees, led by "The Artist" and "Hugo," lacks a mainstream blockbuster film that would help lure mass numbers of viewers to the awards telecast. The biggest box-office draw of the major nominated films was "The Help," which had four nominations.
Billy Crystal will host this year's awards ceremony.

The Academy Awards historically is one of the top television events of the year — often second only to the Super Bowl — and has become advertisers' favorite vehicle to reach women. The show is typically the second most-expensive network TV buy, too, after the Super Bowl. In the advertising world, the event is known as the "Super Bowl for women."

The Oscar audience is also typically upscale, representing viewers with plenty of disposable income, making it all that more attractive to advertisers.

The Oscars ceremony also has drawn high advertiser interest because — like the Super Bowl or the "American Idol" finale — it is broadcast live and viewers watch the commercials rather than speeding through them with their digital video recorders. That makes the ad time more valuable to companies.

War Horse Spielberg DreamWorks

'War Horse' tapped veteran trainer Bobby Lovgren Horses have long played lead roles in cinema, from the classic movie “National Velvet” to 2010’s “Secretariat,” a drama based on the Triple Crown-winning thoroughbred. But rarely have they taken center stage as much they do in “War Horse,” Steven Spielberg's Oscar-nominated epic about an English farm boy's lasting relationship with a horse that is sold to the cavalry during World War I.

For chief horse trainer Bobby Lovgren, it was one of the veteran’s toughest jobs to date.  Lovgren has trained horses for movies that have included “Seabiscuit,” “Cowboys and Aliens” and “The Legend of Zorro.”

The locally based 46-year-old trainer, however, says nothing has compared to the scale of work on “War Horse,” the DreamWorks Pictures movie that has been nominated for six Academy Awards, including best picture. The film, which cost about $70 million to make, was adapted from Michael Morpurgo’s 1982 children’s novel that inspired successful stage productions in London and on Broadway.

While the acclaimed play utilized life-sized puppets for horses, Lovgren’s task was to oversee the training of more than 150 live horses used in the film. He recruited a team of seven trainers from Australia, Spain and the U.S. as well as groomers, handlers, transporters -- even an equine hair and makeup unit.

“What made ‘War Horse’ so special was that it was a combination of everything I’d done before with horses all put into one movie," said Lovgren in an interview from New Mexico, where he is working on the Disney film “The Lone Ranger,” starring Johnny Depp. “It’s the biggest horse movie I’ve ever done.”

Lovgren is among a select group of animal handlers, trainers and wranglers in the industry, many of whom live in the northern L.A. County community of Acton, where he owns a small horse ranch.  Teamsters Local 399 has 130 union members who are animal trainers, handlers and wranglers, down from as many as 500 members in the 1970s, reflecting the decline in the western movie and television genre and widespread use of computer effects that has lessened the demand for live animals in films, said Steve Dayan, a business agent for Local 399.

Nonetheless, animal trainers like Lovgren remain essential and often unheralded behind-the-scene players in Hollywood.  “There are only a handful of guys left like Bobby," Dayan said. “What they do is a very special art and skill that is a huge part of our history.”

Lovgren came to Hollywood via South Africa, where his parents owned one of the largest riding and jumping stables in the country.  He moved to Los Angeles in 1989, learning the ropes of the business from renowned horse trainers Corky Randall and his father, Glenn Randall Sr., who worked on such movies as “Ben Hur” and “Black Stallion.”

He went on to work as a trainer in dozens of movies, including “The Mask of Zorro,” “Running Free” and the 2005 comedy “Racing Stripes,” in which he trained zebras as well as horses.

On “War Horse,”  which has grossed $77 million domestically since its Christmas Day release, Lovgren spent two and a half months training actors to ride and feel comfortable with the horses before filming began in various English locales, including South Devon.

Lovgren and his team also had to discern how each of the horses responded differently to smoke, gunfire and other distractions. Trainers used body language, hand signals and repetitive exercises to train the horses to perform certain tasks and assess their individuals skills, such as jumping, chasing or pulling.

Fourteen different horses to play the title character of “Joey,” each depicting different stages of his life. One of them was Lovgren’s own horse Finder, whom he purchased after training him in “Seabiscuit.” Lovgren said Finder has a special ability to convey his feelings and connect with audiences. “He’s quite a ham in front of the camera," he said.

Lovgren closely collaborated with Barbara Carr, a representative of the American Humane Assn., which monitors the welfare of animals used in films. “I found him to be a wonderful horse trainer," said Carr, adding that no horses were injured during filming.  “He seemed to have a real feeling for the horses.”

While most of the scenes involved living horses, Spielberg used an animatronic horse for parts of a graphic battle scene in which Joey gets trapped in barbed wire. In the film’s production notes, Spielberg said of Lovgren: “Bobby and his team literally performed miracles with the horses in this film.”

Scene from Disney's upcoming film "John Carter"

Theupcoming Disney movie "John Carter," starring Willem Dafoe as Tars Tarkas, center, and Taylor Kitsch, as John Carter, at right. Credit: Disney

A rebound at Walt Disney Co.'s domestic theme parks and strong performances by ESPN and the Disney Channel helped drive a 12% increase in the company's first-quarter net income compared with a year earlier.

The Burbank media giant reported that revenue for the quarter ended Dec. 31 was essentially flat at $10.8 billion, up 1% from a year earlier. Net income rose to nearly $1.5 billion for the period, up from $1.3 billion a year earlier. Earnings per share rose 18% to 80 cents, from 68 cents in the prior year's first quarter.

"We're off to a good start in this fiscal year," Disney President and Chief Executive Bob Iger said in a statement.

Before Disney reported its results, media analysts said they would be watching advertising trends at ESPN, the powerhouse cable sports network that Morgan Stanley estimates contributes approximately 8% of the company's revenue.

ESPN's primetime ratings tumbled 15% in the December quarter, compared with a year earlier, according to TV ratings firm Nielsen. Viewership for "Monday Night Football" fell "due to an underwhelming lineup," according to Morgan Stanley.

The sports network's advertising revenue was essentially flat in the quarter, Disney reported. ESPN was negatively affected by the NBA player lockout, which delayed the start of the professional basketball season. The network carried just two games played in the quarter, versus 29 a year earlier, ESPN said. (Revenue resulting from the Rose and Fiesta college football bowl games will be reflected in the second quarter.)

Nonetheless, Disney's media networks group, which includes its cable channels as well as its ABC television network and locally owned stations, continued to fuel the company's bottom line. Revenue for the quarter rose 3% to $4.8 billion and segment operating income rose 12% to nearly $1.2 billion, compared with the same quarter a year earlier.

Morgan Stanley analyst Benjamin Swinburne had expected theme park margins to improve, as new attractions opened and the effect on Tokyo Disneyland royalties from last year's devastating earthquake and tsunami in Japan fades.

Disney said revenue for parks and resorts rose 10% to $3.2 billion in the quarter, compared with a year earlier, and that operating income increased 18% to $553 million. The company said visitors were spending more at its domestic parks. The Disney Cruise Line also reported higher operating income.

The film studio's revenue fell 16% to $1.6 billion for the quarter, but operating income grew 10% to $413 million. Though the company scored with "The Muppets" and the late third quarter re-release of "The Lion King," and acted as distributor for movies including DreamWorks' "War Horse," the studio had fewer Disney-branded movies in theaters over the holidays, the company said. DVD sales fell.

ABC's "World News" anchor Diane Sawyer. Credit: ABC. 

An English Language Spanish News Channel is in the works for the millions whose primary language is English. The Walt Disney Co. and the nation's leading Spanish-language broadcaster are in talks to launch an English-language cable news channel, according to people familiar with the matter.
A new 24-hour channel would represent a move by both companies to enter new territory. Disney's ABC News could compete for viewers with established around-the-clock cable news operations such as News Corp.'s Fox News, Time Warner's CNN and Comcast Corp.'s MSNBC. Until now, ABC has shown little appetite for joining the cable news wars.

Univision Communications, which owns the nation's fifth-largest TV network, could use the channel to reach more acculturated viewers that advertisers prefer: Latinos who predominately speak English.  Univision has already announced plans to launch a cable news network, this one a Spanish-language channel, later this spring.

A Univision spokeswoman declined to comment, as did an ABC spokesman.

ABC has struggled to be more competitive and has shed hundreds of staff members from its ABC News division because the network produces only a few newscasts. NBC News correspondents provide coverage to multiple channels, allowing the network to better monetize costs.

The discussions were first reported Monday by The Wall Street Journal, but no deal is imminent, said one knowledgeable person.

The nation's Latino population is sizable and fast-growing. Nearly 50 million people described themselves as Hispanic or Latino in the 2010 U.S. Census, up 43% from a decade ago.

Second- and third-generation Latinos also have greater disposable income than their parents or grandparents, making them an atrractive and underserved audience. Targeting these viewers would help differentiate the channel from more established cable competitors.

Cesar Conde, president of Univision Networks, addressed his desire to court bilingual viewers in a keynote speech he gave last month during the National Assn. of Television Program Executives convention in Miami. Univision has begun offering English captions for all of its prime-time telenovelas.

As envisioned, ABC and Univision would share news gathering and production costs. Disney would also stand to collect subscriber fees from cable operators, helping to underwrite the heavy cost of a television news operation.

"This Means War" stars Chris Pine, left, Reese Witherspoon and Tom Hardy
Chris Pine, left, Reese Witherspoon and Tom Hardy in "This Means War." Credit: Kimberly French / Fox.

Valentines Day delays "This Means War." In an unusual move, 20th Century Fox is pushing back the official opening of the romantic action-comedy "This Means War" from Tuesday, Feb. 14 to Friday, Feb. 17. The move may be designed to let the studio avoid reporting what likely would have been weak box-office receipts on Valentine's Day.

 However, the movie will still get a "sneak preview," playing once Tuesday evening at between 2,000 and 2,500 locations nationwide. "This Means War" will then disappear from theaters for two days and officially open on Friday.

Pre-release surveys indicate audiences are less interested in "This Means War," which stars Reese Witherspoon, Chris Pine and Tom Hardy, and is directed by McG, than other movies opening in the next week. In particular, the romantic drama "The Vow" starring Rachel McAdams and Channing Tatum is proving popular with women, who are also a target audience for "This Means War." Research shows that women often dictate moviegoing choices on Valentine's Day.

"The Vow" is expected to open to at least $30 million from Friday through Sunday, while "This Means War" is on track to take in about half that much on its first weekend.

By playing the movie as a "sneak preview," Fox will not be expected to publicly report its grosses for Tuesday and potentially disclose that it came in No. 2, if not lower, generating negative press attention going into the weekend. Instead, the only public discussion around the film will be whether people who attended the sneak screening liked "This Means War."

"Word of mouth is great on this movie, and this gives people more time to talk about it," said Fox executive vice president of distribution Chris Aronson. "Sometimes you’ve got to let the movie speak for itself."

Typically, sneak previews happen a week or more before a movie debuts. Fox's "We Bought a Zoo," for instance, was previewed over Thanksgiving weekend but didn't officially open until Christmas Day.

Fox's last-minute gambit with "This Means War" is a gamble, in part because widespread advertisements have proclaimed that it opens Feb. 14.

Fox is betting that positive buzz will help boost the box-office tally for the approximately $65-million production on the weekend of Feb. 17.

Brad Pitt MoneyballWhile
Brad Pitt in a scene from the movie "Moneyball," which received a California film tax credit. Credit: Melinda Sue Gordon

UCLA gives only qualified approval to Film Tax Credits. California's film tax credit is providing an economic benefit to the state, it may not be providing as much of a return to taxpayers as an earlier study claimed.

That's one of the main conclusions from a new study conducted by UCLA's Institute for Research on Labor and Employment about a program the state adopted in 2009 to help curb runaway production. The state sets aside $100 million annually for the program, under which filmmakers can receive a credit of 20% to 25% of qualified production expenses (salaries of actors are excluded). They can apply the credit to offset any sales or business tax liability they have with the state.

The UCLA study concludes that the California tax credit "is creating jobs and is likely providing an immediate economic benefit to the state," but finds that some claims about the program's value have been exaggerated.

In particular, the study takes issue with some aspects of a report by the Los Angeles County Economic Development Corp. and financed by the Motion Picture Assn. of America that found that for every $1 the state allocated in a tax subsidy, the state recouped as much as $1.13 in spending.

That LAEDC estimate assumes that all productions applying for a subsidy will leave the state if they don't receive one. However, the UCLA researchers found that some of the productions that didn't get a credit, which is awarded on a lottery basis, still opted to shoot their films in California. Taking those projects out of the mix reduces the fiscal impact to as much as $1.04 per $1 of tax allocated, not $1.13, according to the UCLA report.

Nonetheless, the study, which included a survey of filmmakers, highlights the important role that state tax credits play in determining where they choose to shoot.

"Even though there is likely a small benefit to the state, I think the California film and television tax credit is a worthy program because, without it, in the long run, California is likely to lose dominance in an industry that is very important to the state's economy," said Lauren Appelbaum, research director for the Institute for Research on Labor and Employment.

The UCLA study was commissoned by Headway Project, a new think tank headed by former magazine publishing executive Michael Kong. In a separate report he authored, Kong makes several recommendations to improve the state tax credit program, including removing restrictions that forbid the sale or transfer of tax credits to third parties (except for low-budget independent movies) and doubling the funding of the current credit to $200 million a year.

Christine Cooper, author of the LAEDC report,  said she and her colleagues had made a “reasonable assumption” that the productions that received the tax credit wouldn’t have  occurred without the incentive. “We are happy to see that the UCLA study confirms our finding of a net positive fiscal impact,’’  Cooper added. “While we can quibble over pennies -- $1.04 versus $1.13 in net positive fiscal impacts -- states like Louisiana are setting production records at our expense.”

Joe Drake Lions Gate
Joe Drake. Credit: Lawrence K. Ho / Los Angeles Times

Spin Off at Lions Gate? Mandate Pictures, the Lions Gate Entertainment-owned film finance and production company behind such movies as "Juno," "Harold and Kumar Go to White Castle," and "Young Adult," may soon regain its independence -- under the management of Joe Drake.

As part of the executive's planned departure from the Santa Monica studio next month, Lions Gate senior management has held preliminary talks with former motion picture group chairman Joe Drake about partially or entirely spinning off Mandate, which he co-founded nine years ago, two knowledgeable people not authorized to speak publicly confirmed.

Drake's plans have been unclear since Lions Gate acquired Summit Entertainment in January and installed its co-chairmen, Rob Friedman and Patrick Wachsberger, in Drake's job. At the time, Lions Gate Chief Executive Jon Feltheimer said Drake would stay on to oversee the March 23 release of "The Hunger Games," the studio's most expensive and highest profile production to date.

It now appears that Drake could reclaim his old seat at Mandate. The executive helped launch Mandate in 2003 and ran it until 2007, when he sold the independent studio to Lions Gate for $60 million and assumed his role as motion picture group chairman.

However, Drake always maintained his title as CEO of Mandate  while leaving the day-to-day operations of the venture to president and fellow co-founder Nathan Kahane.

Now Drake and Kahane may take back control of Mandate and run it independently from Lions Gate, the two people familiar with the situation said.

It's not yet clear exactly what form that separation would take. One person close to the matter said the two firms would probably maintain a business relationship. In addition, Lions Gate would keep some control of Mandate's library of nearly 30 pictures.

A separation agreement has not been finalized, however, and it's not yet certain that one will be reached, people close to the matter cautioned.

With Lions Gate's acquisition of Summit bringing together two film companies with separate production and marketing staffs, some in the industry have questioned whether Lions Gate would need a third movie division under the same roof.

Since it was acquired by Lions Gate, Mandate has developed a small slate of pictures that it co-financed with other studios, including Paramount Pictures, Sony Pictures and even Summit. The upcoming Sam Raimi-produced horror thriller "The Possession" is the first film Mandate will release in partnership with its new parent company.

Other planned 2012 Mandate releases include the comedies "Great Hope Springs," with Meryl Streep and Steve Carell, and "Seeking a Friend for the End of the World," starring Carrell and Keira Knightley. 

The Super Bowl set a new viewership record
New York Giants quarterback and Super Bowl MVP Eli Manning. Credit: Jamie Squire / Getty Image 

The Daily Dose: Once again a Super Bowl halftime performer (M.I.A.) has tried to upstage the game itself. Now NBC and the NFL are pointing fingers at each other for who goofed -- NBC says the NFL oversees the act while the NFL says the network's delay should have worked and spared us from the performer's middle finger. Seems logical, though, that if the NFL wants to make sure this kind of stunt never happens again, it needs to put a clause in its contract that will hit the performer with a huge financial penalty if any unscripted action mars the game or potentially puts the show in trouble with advertisers and regulators. Certainly the league has enough lawyers to come up with that. And if they did do that already, they should donate the fine to a charity to help retired players.

Big numbers. NBC's telecast of Sunday's Super Bowl thriller between the New York Giants and New England Patriots drew a record audience of 111.3 million viewers, barely topping last year's previous high of 111 million. Does that make the $3.5 million that advertisers spent on commercials worth it? To answer that question, ask yourself how many of those ads you remembered 10 minutes after they aired. More on the ratings from USA Today.

A foot in both camps. On Monday, word emerged that Verizon was teaming with Red Box on a video streaming service that would try to take on Netflix. But Red Box, whose claim to fame is its kiosks outside supermarkets and 7-Elevens where people can rent movies on the cheap, isn't ready to throw in the towel on that business. Red Box parent Coinstar said it would spend up to $100 million to buy up Blockbuster's in-store DVD business, acquiring 9,000 or so DVD kiosks currently in use by the rental chain. Details from the Los Angeles Times.

Roaring again? MGM, which has struggled almost as long as the now-red-hot Los Angeles Clippers (yes, I was struggling for an analogy), is suddenly flush with cash. According to Deadline Hollywood, the historic studio has a new $500-million credit line ready to spend on new movies. Of course, this isn't the first time we've read the "MGM is back" story so I'll wait a little longer before saying that the lion's bite is bigger than its roar.

New money. Bruno Wu, a well-known Chinese media mogul whose wife, Yang Lan, is a popular TV personality there, is joining in a new $800-million fund that will invest in entertainment opportunities. Details on where Wu's partnership is looking to spend from the New York Times.

Inside Los Angeles Times: The fastest growing digital music service you've never heard of is MuveMusic from Cricket Wireless, a small San Diego-based phone company. Robert Lloyd on ABC's new drama "The River."

-- Joe Flint and others

1 comment:

Karen Johnson Com-101-4080 said...

The MGM lion roaring again and thriving is a positive for the industry.
To see the lion's face at the end of a movie is classic.