Fox Atomic's demise leaves just one genre arm

And then there was one.

The once-ballyhooed Fox Atomic took its last breath this week, leaving Screen Gems as the lone genre label housed at a major studio.

One by one, the six majors have divested themselves of the profitable but low-reward divisions that crank out horror, teen and urban fare. Before Atomic’s implosion, Universal Pictures was the most recent studio to get out of the dedicated genre game, selling its Rogue Pictures to Relativity Media in October for $150 million.

Disney, which never really had an appetite for the product, bid farewell to the genre business when Bob and Harvey Weinstein exited the studio in 2005, taking their lucrative Dimension Films label with them. Paramount Pictures once seemed poised to dominate the space by making its MTV Films label into a genre powerhouse. But the Melrose studio never realized the potential of its teen-friendly brand and basically shuttered MTV Films as an autonomous division in late 2007.

Paramount even briefly toyed with the idea of refashioning its Vantage division as a source of low-budget genre fare, tapping Lionsgate alum Nick Meyer to run the unit in January 2008. But in short succession, Paramount folded Vantage’s marketing and distribution functions into the parent studio and then dismantled almost the entire staff. Meyer was out by December.

Warner Bros. Pictures is the only major that never jumped on the genre label bandwagon, though it has relied on Joel Silver’s Dark Castle shingle to produce and finance a slate of roughly three pics per year that the studio distributes. But as Warners slims down its annual slate, it seems unlikely that the Burbank studio would continue to give three puts to Dark Castle beyond the deal’s 2011 end date, given the mixed results of the shingle’s three most recent films: “House of Wax” ($32.1 million), “The Reaping” ($25.1 million) and “RocknRolla” ($5.7 million).

One longtime player in the genre world explains that the death of the studio’s genre divisions mirrors what’s happening in general in Hollywood. The conglomerate-owned majors are increasingly focusing their efforts on tentpoles and sequels.

“Fox would rather make ‘Wolverine’ than a Fox Atomic film,” the executive says. “They don’t need a $50 million earner. It’s not worth their time.”

A similar sentiment was echoed when Relativity snatched up Rogue back in the fall for what was considered a bargain price. At the time, an insider to the deal said that Universal’s parent company General Electric would rather sell low, pocket the cash and move Rogue’s overhead off its books. After all, while the division reliably turned a profit, it barely made a dent in GE’s bottom line.

For Fox Atomic, the underperforming label’s fate was sealed last month when Peter Rice was moved to the TV network side as chairman of Fox Entertainment. Rice had been given oversight of the label, which targeted the 17- to 24-year-old demo, when it was formed in 2006.

It didn’t help that Atomic’s most recent release, the $20 million actioner “12 Rounds,” did little to impress at the box office (with a meager haul of $11.4 million) or to help define the label’s identity.

“The problem with Atomic was I didn’t know what they were; I didn’t know what their message was,” says a marketing exec who has launched some of the most successful genre campaigns. “I think it’s telling that the one or two upcoming films on the Atomic slate were so quickly absorbed by Searchlight.”

Screen Gems remains the lone studio-sponsored genre division in town. With savvy prexy Clint Culpepper and the company’s marketing team, Sony toppers Amy Pascal and Michael Lynton have seen Screen Gems turn out a number of teens-in-distress horror hits (“Prom Night,” “When a Stranger Calls”) to complement urban titles (“This Christmas,” “Stomp the Yard”). Culpepper rarely hires big names to carry his films, instead relying on high concepts: An urban high school-set reimagining of Jane Austen

So what did Screen Gems do right that Atomic did not? Screen Gems differs from Atomic in that Culpepper is more likely to greenlight a movie about teens getting hacked to death on prom night rather than getting lucky on prom night. For myriad reasons, horror films are far less reliant on stars than comedies.

Still, it’s hard to imagine Screen Gems — even with its modest successes — existing anywhere but at Sony, which might be the last bastion for such an arrangement. The common refrain in Hollywood is that Amy and Michael let Clint do his thing.

But as the majors continue to cut genre fare from their diets, there will be plenty available for the independents, which are having more trouble with traditional arthouse fare these days. Lionsgate, Dimension and Rogue will fill the void left by the increasingly genre-averse studios.

Dimension’s upcoming slate includes a slew of familiar horror titles from the past revamped for the new millennium including “Piranha 3-D” with Richard Dreyfuss and the Rob Zombie-helmed “Halloween 2″ as well as remakes of “Hellraiser,” “Scanners” and “Short Circuit.” Lionsgate, which has enjoyed incredible success with genre fare in the past, will continue to add similar pics to its pipeline, including “Tyler Perry’s I Can Do Bad All by Myself,” “Cabin Fever 2″ and the vampire pic “Daybreakers.” Meanwhile, Relativity’s Rogue will remain true to its original game plan with films like Wes Craven’s “25/8,” a remake of “Near Dark” with Michael Bay producing and a sequel to “The Strangers.”

“It makes the companies remaining that much stronger,” says Bob Weinstein, optimistically.

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