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Think you got a deal?

Except for a few uber-producers, most studio pacts mean no money or perks

Click here to view the “Facts on Pacts” chart

A few years ago, studios severely cut back on their production deals and have slowly been trimming the numbers ever since.

In our semi-annual survey, Variety found that the overall tally has hit an all-time low of 236. With the changes at Miramax and MGM, and exec shuffles at other studios, that figure seems destined to plunge even more in the coming year.

But what do the numbers mean? They tell a story, but it’s the wrong story.

In Hollywood, image and perception often outweigh reality. A producer with a studio pact was formerly perceived as a mover and shaker.

Today, a few pacts carry weight, but the bulk are purely symbolic: They are pacts that are non-pacts, with no money and no perks. A pact nowadays simply entitles a producer to pitch a project, which he or she probably will end up selling somewhere else.

As with political polling data, the stats are instructive; they take the pulse of what’s going on. But the tallies on deals don’t convey nuances of the truth — such as Hollywood’s increasingly rigid class system.

There are three levels of pacts. First are the companies with fully financed projects that they bring to the studio with a friendly “take it or leave it” attitude. Examples: Beacon and New Regency.

Second are the “name” production shingles, such as Ron Howard and Brian Grazer’s Imagine Entertainment’s or Jerry Bruckheimer Films. The studio is responsible for the money, but these guys have a track record that makes the investment as safe as possible.

Third level: everyone else.

Many magazines publish “power lists,” evaluating media honchos in terms of their clout. There’s always something arbitrary about them: What really determines the difference between being No. 37 and No. 38?

The semi-annual Facts on Pacts list is not arbitrary; you either have a deal or you don’t.

But there is something inherently anachronistic about it. Having a production pact at a studio is no longer a measure of success. The lists should be read with a “Sure, they have a production deal, but where are they making their films?” skepticism.

“People running the studios have analyzed the deals and concluded that they don’t need to pay a lot of producers to develop material since the studios are supposed to be doing that in the first place,” says one talent agent. “Their attitude is, ‘producers need us because they only have five other places they can go.’ ”

Non-marquee producers may get anywhere from $100,000 to $1 million, but that money has to pay for everything — from office space (at Warners, the going rate is $1 per square foot per week) to parking spaces, from health insurance and payroll taxes to the guys who water the ferns and move the furniture.

So why bother? The same reason that do-nothing starlets crowd the red carpets every night: Perception is reality.

“If you don’t have one, people are going to think you don’t have any juice,” says one Paramount producer. “You won’t get decent material from agents without a deal.”

However, even “name” producers have learned that they can’t survive if they treat their studio as the only one in town. They’re having a tougher time placing projects even with the studio that supposedly loves them the most.

There’s an element of my-studio-doesn’t-understand-me in this attitude, but there’s also a hard-nosed business reality. No matter how tight a producer may be with his home team, loyalty is no way to make a living.

“The smart ones are dealing with everybody,” says one longtime studio-based producer. “It’s become a way of life. No one studio is doing a lot with any one producer. They used to buy more from their on-lot producers but now they’re much stingier with development money. It’s much, much tougher.”

Some, like Ashok Amritraj’s MGM-based Hyde Park Entertainment, go so far as to make full-fledged second-look deals — in his case, with the Walt Disney Co.

Others simply take their business elsewhere.

Par’s Scott Rudin made four films at home this year, but also produced “I Heart Huckabees” for Fox Searchlight; “The Life Aquatic with Steve Zissou” and “The Village” at Disney and “Closer” at Columbia.

“The top guys still are valuable, but the studios pass on everyone else all the time,” says one agent who describes 75% of on-the-lot producers as “inactive.” However, that inactivity is often a self-fulfilling prophecy.

Some young producers complain that they aren’t needed for material, since studio execs get so much from their own agent contacts.

The truth is, reps often view on-lot producers as the best conduits for bringing their material into the studios. Not only does a production company give a script an extra set of advocates, but studios also look down on projects that come without attachments. A script without a producer, the logic goes, might not be good enough to get one.

However, to give a script to a producer who isn’t high on a studio’s radar, “is 50 times worse” than giving it to a studio exec, according to one lit agent.

“I have two lists of producers on the lots,” he says. “One is for all the producers they have deals with. And there’s another list of producers that they will actually buy projects for.”

That hot list is in a state of constant evolution and it doesn’t always favor the big boys. A studio is much more likely to buy for a greenhorn producer still in the honeymoon period than for a high-profile shingle that’s purchased a lot of expensive scripts that haven’t moved into production.

One young producer describes himself as “a puppy nipping at their heels. You hope that major producers are going to decide to spend less time working on films so that you’re able to do more than fight for scraps.”

Still, he admits that there can be certain advantages to puppyhood.

“With top producers, if they start to fizzle, there’s huge pressure because the deals cost so much,” he says. “There’s not that pressure for us yet. We don’t cost so much that it impedes getting a greenlight.”

So, given all this, should a producer give up on the idea of a production pact?

“If producers don’t have them, they would kill to get them,” says a longtime Paramount resident. “But once they’ve got them, they’re viewed as a necessary evil.”

Click here to view the “Facts on Pacts” chart

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