Inside Move: ‘Halo’ thorny for Microsoft

Vidgame adaptation teaches congloms about studio dealings

Turning its videogame “Halo” into a feature has provided Microsoft with a crash course in the complexities of dealing with conglomerate-owned studios that are rivals in other arenas.

Having Universal and Fox back out of the deal they made (Daily Variety, Oct. 20) was doubly bad, because it removed two of the few studios that would make a Microsoft-spawned film. The “Halo” producers and Microsoft have concentrated their efforts this week on Warner Bros. and Paramount, because of baggage involving the rest.

Sony, whose PlayStation is a direct competitor to Microsoft’s Xbox, was never a possibility; Microsoft’s rivalry with Apple made Disney a difficult fit, because Apple CEO Steve Jobs is the Mouse’s largest individ-ual shareholder and a Disney board member. And New Line is still en-gaged in a dispute with “Halo” producers Peter Jackson and Fran Walsh over “The Lord of the Rings” proceeds.

Though Par-based DreamWorks head Stacey Snider ran Universal when the original “Halo” deal was made and brought Jackson and Walsh aboard as producers, WB was the studio most intrigued by “Halo.” But WB and its financing partners are coming off a tough year, and they’ve so far balked at the deal terms proposed by the “Halo” team, sources said.

The U/Fox deal gave “Halo” a $128 million budget. And while Micro-soft and the pic’s producers aren’t taking upfront fees, their collective gross is around 19%, sources said. That is significant for any film with no stars and a first-time director. It is especially daunting in the current conservative studio climate.

Speculation is that the filmmakers will either bend on budget and gross if they want a studio deal, or alternatively pursue a private financing strategy as Tom Cruise is doing with Washington Redskins owner Daniel Snyder, NVR chair Dwight Schar and Six Flags prexy-CEO Mark Shapiro.

Microsoft could even write the check, and rent distribution as Mel Gib-son did with “The Passion of the Christ.” The reward in success would be much greater than any studio deal would provide, but the vidgame owner would take the risk.

With those variables unresolved, the filmmakers are forging ahead. Prep work continues at Jackson’s Weta studios in New Zealand. An Alex Gar-land script, already rewritten by “Ender’s Game” scribe D.B Weiss, will get another rewrite by “A History of Violence” scribe Josh Olson, sources said.

Microsoft declined comment.

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