<!-- Begin meta tags generated by ORblogs --> </meta name="keywords" content="progressive, liberal, politics, government, edit, language, grammar, accuracy, honesty, clarity, world, news, media" /> </> <!-- End meta tags generated by ORblogs -->> Editor at Large: DreamWorks is dead

Tuesday, December 13, 2005

DreamWorks is dead

Steven Spielberg, David Geffen, and Jeffrey Katzenberg are selling DreamWorks SKG to Viacom for $1.6 billion. Viacom's studio division, Paramount Pictures, will get DreamWorks' library of about 60 films, including "Saving Private Ryan," "American Beauty," and "Gladiator," and Paramount will also get half the profits of any movie Spielberg makes at another studio.

What went wrong for DreamWorks? The prevailing theories:

• Profitability. DreamWorks could not survive because the costs of running a studio are so high that it's impossible to make a profit without other large revenue streams, such as a sizable DVD library.

• Bad management. The live-action studio was run, until recently, by Walter Parkes and Laurie MacDonald, a married couple who also produced several of the movies that DreamWorks released. Thus, the couple was busy on film sets producing its own movies instead of greenlighting other people's.

• Disparate ambitions. Katzenberg wanted to head his own studio (and now he does, at DreamWorks Animation); Spielberg prefers directing; and Geffen, a music guy, has never really liked the movie business. Spielberg and Geffen wanted the power and freedom of owning a studio, but not the burden of running one.

So will we see another sequel to Shrek? Yes, as a matter of fact. "Shrek 3" is coming in 2007. "War of the Worlds, Part II"? We hope not.



Blogger activist kaza said...

My good editor:

As an observer who has worked in and out of Hollywood for some years, my own take on Dreamworks is this: it could have worked, but for the divergent paths of the principals and the obscene basis on which the studio was first established. What do I mean by the latter? The "SKG" gang - whose egos dictated that this monogram/moniker(?) appear as part of the company's name - had greater equity and less money in the venture than our friend to the north, Paul Allen.

It was Allen and his advisors who most wanted to "cash out" of Dreamworks, but you are right about the boredom of the principals (altho I think Geffen likes the movie business a lot more than you suggest...he's just not very good at it).

As the original creation of Dreamworks was a pretty strange deal (in financial terms), so too is Paramount's acquisition. A bigger question these days might be just what Paramount thinks it is buying, since every thoughtful commentator I know of has suggested the biggest value of Dreamworks is in its film library, but Paramount says it is selling that!

This saga points out the truth that Hollywood operates like no other business...in birth or in death.

6:10 AM  
Blogger Editor at Large said...

Thanks for the thoughtful and insightful perspective, Kaza. We didn't know Paul Allen had a stake in DreamWorks, and now that we do, it all makes a bit more sense! Paramount's bizarre intentions, however, are another story...

9:36 AM  

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