Polygram Plots Its Return To Film Biz

Once bitten, twice shy, record giant Polygram has unobtrusively re-entered the film business. With three independent production companies and a foreign sales agent under its wing, the company is carefully mapping distrib strategies in the U.S. and foreign.

Polygram was burned in the early 1980s when, under the current Columbia whizkids Peter Guber and Jon Peters, it produced a series of flops. This time it’s carefully spreading its eggs around a number of baskets: It owns A&M Films (inherited as part of the acquisition of A&M records last year) and has stakes in Propaganda Films of L.A. and Britain’s Working Title Prods.

Michael Kuhn, Polygram media division CEO, expects that trio to generate seven to 10 films a year, with foreign rights fielded by London-based Manifesto Film Sales, co-venture between Polygram, Propaganda and Working Title.

“Our philosophy is to work with a number of creative units” rather than act as hands-on producers and financiers, he said. Currently he’s developing strategies designed to secure a bigger slice of the b.o pie and ancillary revenues.

Thus he’s investigating ways of becoming more directly involved in the hazardous waters of U.S. distribution, and Manifesto has clinched 3-year output deals in the U.K. with Rank Film Distributors and RCA/Columbia HV. Exec says: “Unless we access [profit] margins from the distribution side, the figures in filmmaking do not add up.” He’s also determined to reap the benefits of burgeoning tv markets, opining: “The ’80s were the video years. The ’90s are the tv years. We have to access tv values, and we can’t do that if we do fully crossed deals, territory by territory.”

In the U.S., he’s weighing a number of options including:

* Forming his own distrib banner, or buying into an existing distrib.

* Releasing product by renting studio systems.

* Doing hybrid deals like Carolco, which farms out product via Tri-Star and Seven Arts/New Line.

Separately, Polygram and Working Title are joining a consortium to pitch for a U.K. commercial tv franchise (see page 35).

Since A&M Films came into the fold, Kuhn says it’s making the transition from a packager of films for studios (e.g., “Blaze,” “The Breakfast Club”) to a fully independent producer. A&M is doing “Crooked Hearts” for MGM and is readying a remake of Stephen Frears’ “The Hit,” helmed by photographer David Bailey, and “Libra,” a controversial opus on the President Kennedy assassination.

Said Kuhn: “We’re unlike any other operation I can think of, with two production companies in Hollywood plus a European based entity in Working Title, and Manifesto. Our product is not schlock and it isn’t big, mainstream studio [fare]. It’s in between.”

In the past year, the Polygram stable’s biggest success was Propaganda’s “Wild At Heart,” which grossed a modest $15 million Stateside. “We have not had a movie yet that’s done significant business, but I’m confident we’re going in the right direction,” he said.

In the U.K., Manifesto will take a “significant position” in p&a and work closely on marketing and publicity with Rank, according to Manifesto sales director Wendy Palmer. She sees advantages in dealing with Rank as a blue chip firm that owns the nation’s second-largest circuit.

Initial batch of films to flow through Rank and RCA/Colpix will be Working Title’s “Drop Dead Fred,” “Rubin & Ed” and “London Kills Me,” and Manifesto’s first third-party acquisition, Joel and Ethan Coen’s “Barton Fink.”

Said Rank’s Fred Turner: Manifesto will bring a lot of British pictures, which on average tend to do well. We’re happy to have them at no risk. That gives us a base to perhaps take risks in other areas.”

Manifesto already has output deals with Laurenfilm in Spain, Telemunchen in Germany, Penta in Italy and Hoyts in Australia. Palmer says she’s keen to do more deals structured along the lines of Rank and RCA/Colpix.

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