Pondering Hollywood's megapaychecks
Hollywood is a famously neurotic town, but its corporate Brahmins, nonetheless, pursue their own rules of continuity. Time Warner’s decision to renew the deals of Barry Meyer and Alan Horn provides yet another reminder that even economic upheaval will not destabilize the power pyramid.
Meyer, 65, will stay at least another two years as chairman and CEO while Horn, 66, remains president and chief operating officer. This follows the pattern at other studios, with Ron Meyer holding fast at Universal, Brad Grey at Paramount, Howard Stringer at Sony and Bob Iger at Disney.
The continuum was further reinforced at 20th Century Fox, where Rupert Murdoch, 78, decided to assume direct control over his empire following the decision of Peter Chernin, 57, to exercise his very golden parachute. Perhaps Chernin felt too young for the job.
A story in the New York Times last week noted that “a new generation of Hollywood power players is finally being forced to test its mettle.” According to the Times, a tough-minded band of operatives who are now in their 40s are “tightening belts … and becoming more cutthroat” as they assume greater power in the entertainment business.
The Times piece rightly suggests that the “new generation” faces a climate of great stress, but it neglects to point out that the real power in Hollywood still remains well beyond their reach.
This remarkable continuity holds true even at the notoriously quarrelsome level of studio production chief, where rumors of imminent change always echo in the corridors. At Universal, the team of Marc Shmuger and David Linde has just signed on for a few more years. John Lesher has survived five years at Paramount, Tom Rothman and Jim Gianopulos have just gained added responsibilities after more than a decade at Fox, and Amy Pascal has been at Sony so long they may rename the commissary after her (Rita Hayworth never really wanted the honor anyway).
So young turks may be warming up in the bullpen, but they nonetheless face a long wait to climb to the top of the pyramid.
One byproduct of tenure is a big paycheck, of course, and that’s especially true in Hollywood. Megacompanies like GE have long had to wrestle with the pay discrepancies between their Hollywood managers and those in more prosaic businesses — nuclear reactors, for example. The two top execs in one Hollywood company (not Universal) pull down an estimated $26 million a year between them, according to one authoritative source, and, despite belt-tightening and staff cutbacks, there’s no sign of retrenchment.
By contrast, the chief executive at Ford had a base salary of a meager $2 million in both ’07 and ’08, and received no bonus last year, but the automaker has been going through tough times. The hedge funds, too, have taken a whack, but those masters-of-the-universe still pulled down astronomical salaries — $2.5 billion for James Simons of Renaissance Technologies, a former math professor. (Stanley Druckenmiller of Duquesne Capital had to settle for a mere $260 million.)
Still, the entertainment business is a high-profile sector, and some in the community have suggested the terrifying possibility of a give-back. Their question: Given the tough times, shouldn’t the mandarins of show business take a voluntary pay cut as a symbol of solidarity? Or at least make some significant contribution to charities, like the Motion Picture Fund, that have ailing budgets?
Those questions have definitively gone unanswered.
The suite life of junkets
Here’s a major advance in design: The new W Hotel on the corner of Hollywood and Vine says it is creating a special environment to facilitate the dreaded ritual known as the film junket. The hotel, which is nearing completion, promises to offer specially designed suites and taping rooms replete with fiber-optic cable and flexible walls that will make it the global center of junketeering.
Junkets presently are centered at the Four Seasons, where stars must trundle from room to room, chased by packs of rabid reporters, and where generators are always popping on and off and film crews seem in a permanent panic.
At the W, apparently, a whole new choreography will prevail for stars and crews alike. Hospitality suites will even have three or more bathrooms and space for hair and makeup.
Of course, the ritual of the film junket has become so tortured, with stars racing to do 50 or more interviews a day, that it would be hard to imagine the process acquiring any measure of civility. Unless, that is, the W Hotel will go one step further by providing audioanimatronic celebrities who, robot-like, move from interview to interview fulfilling their promotional obligations. This would resolve the basic conceit that human beings are actually involved, that real questions are being asked or real answers offered.
I’m sure the W will lure big junkets this year. I still don’t envy the poor folks caught up in them.