MEMO TO: Ted Turner
FROM: Peter Bart
Not long ago, when your news team at CNN retracted its sarin gas story, you remarked that this incident was just about the worst thing that had happened to you during your career.
I found that a poignant admission Ted, but, having thought it over, I wonder if you shouldn’t amend it slightly. Examining the record of the past five years, a case could be made that your multi-billion-dollar invasion of the motion picture business was the worst thing that ever happened to you.
It was just five years ago that you launched your series of bold initiatives in Hollywood. You acquired New Line, a stalwart independent, which was gearing up such hits as “Seven” and “Dumb and Dumber.” You next annexed Castle Rock, which had become just about everyone’s favorite “indie” with hits like “Stand by Me” and “When Harry Met Sally.”
Not content with this $ 650 million caper, you next announced the start of Turner Pictures with an additional mandate to make movies in the Turner manner. “I have loved the movie business ever since I saw my first movie when I was a little boy,” you told a Variety reporter at that time.
And Hollywood loved hearing all this. Here was a new player in town, someone with big bucks and the taste to make good movies as well as commercial movies.
All that was five years ago. Let’s look at the record since then. Under Turner stewardship, New Line promptly plunged into a slump, tried to find new ownership and only now is getting its sea legs again. Castle Rock, the little company that couldn’t miss, soon developed a genius for missing consistently. Turner Pictures pulled together an interesting slate under Amy Pascal, then was unceremoniously folded.
In the interim, of course, Ted, you merged your entire empire into Time Warner, becoming its single biggest stockholder. So now you don’t have to worry about these niggling little independents — you have giant Warner Bros. in your sights.
Whoops! Suddenly that studio, long the most consistent performer in town, has hit a losing streak. And with “The Avengers” plummeting off the charts after one dismal week, there’s no sign of a quick recovery.
What’s going on here, Ted? Are you starting to feel like the Typhoid Mary of the movie business? Is it mere coincidence that every studio you happen to touch starts to look like the victim of a sarin gas attack?
It sure didn’t start out that way. Twelve years ago when you made your razzle-dazzle series of deals with Kirk Kerkorian, you looked like the smartest newcomer ever to hit Hollywood. To be sure, no one could quite figure out who was doing what to whom. First you tried to buy MGM/UA from Kirk for $ 1.5 billion, then said you couldn’t afford it. Next you did buy MGM/UA for the same $ 1.5 billion provided Kerkorian promptly buy back MGM and UA for $ 480 million plus pay another $ 300 million for the MGM logo. Amid all the confusion, you came away with the key resource you needed to galvanize TNT, TBS and all your other TV assets — you got the pre-1986, 3,300-title MGM film library.
That was the good news. Now the bad news: You didn’t walk away from the table. Instead you stayed and kept playing. That wasn’t cool, Ted.
So what has gone wrong? Surely, you have asked yourself why someone with so much money and good intentions keeps striking out at the plate. I’ve talked to several of your senior executives, past and present, each of whom has advanced a pet theory:
Theory One: You never want to get close enough to the action to dirty your hands. The movie business requires not only a commitment, but an activist presence.
Theory Two: Despite all your exuberant statements, you were never really interested in movies to begin with, other than as grist for your TV outlets.
Theory Three: Since you’ve bought up most of the real estate in Western America, you can’t really decide whether you want to be involved in the Byzantine politics of Time Warner or prefer to remain the gentleman rancher and statesman-at-large.
Only you have the answers, Ted. But one thing must gall you: It’s bad enough to lose at the movie game — a lot of people do — but look over your shoulder at your old pal Rupert Murdoch and check out his modus operandi.
A couple of years ago, he appointed a new executive team, developed a business plan and stood by his men in thick and thin (first it was thin, then it got thick). Now look what’s happened: The Fox studio is making big bucks on market-targeted films that were made on controlled budgets. In terms of profitability, Fox probably is No. 1 this summer.
Now that’s daunting news. If Uncle Rupert can master the mysteries of the movie business, why is old Ted still twisting in the wind? Think about that one while you’re riding the range this summer, Ted.