Universal Pictures Looks to Quality, Not Quantity

Universal Pictures Chairman Casey Silver is nervously pacing around his eighth-floor office, a tastefully decorated corner suite with authentic arts and crafts furniture. It is here that “the buck now stops,” as Silver likes to say, referring to the responsibility of ensuring that the studio’s movies yield a positive return on a colossal investment for the company’s shareholders.

Silver, a 10-year veteran of the studio who was handed the keys to Seagram Co.’s movie kingdom nearly two years ago by chief Edgar Bronfman Jr., is excited to talk about all the films he and his new production team, headed by former TriStar executives Marc Platt and Stacey Snider, are assembling.

The 41-year-old executive--who avoids the industry party circuit whenever possible and is considered the most low-key studio chief in Hollywood--would much rather not talk about the gap in Universal’s current release schedule or persistent rumors about his allegedly shaky status. These are issues that he and his bosses shrug off as nonissues.

“I’m committed to being here. . . . And I’m here to tell you we’re making movies,” said Silver, running through the roster of films that he, Platt and Snider are putting together.

A current snapshot would show this: While Hollywood’s new studios, DreamWorks SKG and PolyGram Films, are unveiling their first movies this fall, long- established Universal has no releases in the marketplace until mid-November. That’s 2 1/2 months since the studio’s last release, “Kull the Conqueror,” a box-office dud, in late August.

Silver attributes the pause to the normal ebb and flow of product and to the side effect of undergoing an ownership change and management overhaul since Seagram, the Canadian-based beverage giant, purchased 80% of Universal in June 1995.

“It’s been a time of humongous transition,” Silver said. “I’ve been trying to turn this battleship around.”

Since Seagram’s takeover, Universal Studios has seen wholesale changes from the theme park and music divisions to its television and motion picture units. Ron Meyer, co-founder of Creative Artists Agency, was brought aboard as president of Universal Studios in August 1995, followed by former Viacom executive Frank Biondi Jr.’s appointment as chairman last April.

Silver, who succeeded longtime studio chief Tom Pollock, was elevated to movie chairman in November 1995, giving him the coveted power to “green-light” the films he wants to make.

Like any of his counterparts at other studios, Silver has had a mixed track record with such hits as Steven Spielberg’s “The Lost World,” Imagine Films’ “Liar Liar” and “The Nutty Professor,” as well as expensive disappointments such as “Dante’s Peak” and “Daylight.”

Ongoing rumors about his tenuous future at the studio, amid this year’s flops, which include “A Simple Wish,” “McHale’s Navy,” “Kull the Conqueror,” “Fierce Creatures” and “Leave It to Beaver,” are unfounded, according to Meyer and Biondi.

“We are 100% behind him and are in the process of renewing his deal,” said Meyer, noting that the executive still has a year and a half to go on his contract. “Putting this deal in place is our vote of confidence that he’s doing a first-class job.”

As the production chief under Pollock, Silver was certainly at least partially responsible for the good and the bad. But his own taste and prowess as one of Hollywood’s handful of studio bosses are best measured by next year’s movie slate.

Part of Silver’s test is filling the huge gap left by Spielberg’s formidable Amblin Entertainment, which has been a major supplier to the studio. Spielberg has turned his attention to building his own studio, DreamWorks SKG.

Silver isn’t worried, noting that he has helped retool Universal’s movie division; put together a new executive team, which includes chief operating officer Chris McGurk; formulated a new motion picture strategy, which has been sanctioned by management and Wall Street; and, perhaps most important, “far exceeded” the two financial plans Seagram has set forth for the movie division.

“We have been very profitable both years and have the No. 2 and 3 pictures this year with ‘Lost World’ and ‘Liar Liar,’ ” Silver said, behind Sony Pictures’ top-grossing “Men in Black.”

Although Silver refused to discuss figures, informed sources say “Lost World,” which has grossed about $650 million worldwide to date, has already returned a profit of $200 million to Universal, and that “Liar Liar,” with a worldwide gross of nearly $300 million, has yielded the studio a profit of about $100 million, from their theatrical releases alone.

Biondi said that although it’s true Universal has “significantly beaten the plan for the last two fiscal years, the key is our revenues per film have averaged over $41 million for the first nine months of the year,” compared with Sony’s average gross per film of $35 million and Disney’s $27.6 million. With fewer pictures in release than its competitors, Universal is No. 3 in market share, with 12.1% (13 releases), behind Sony, with 23.1% (29), and Disney, with 15.7% (25).

Part of Universal’s strategy now is to ramp up production over the next three years to 20 to 25 movies a year and diversify its slate of big-budget event films with some moderately priced fare.

All this while trying to reduce the risk by bringing in third-party financial partners when possible. The studio has a $1.1-billion off-balance film financing arrangement with Citibank and is close to finalizing a five-picture foreign financing deal with Gary Levinsohn and Mark Gordon’s Mutual Film Co.

“Our objective is to get our investment in absolute dollars down and release more movies with other people’s money,” Biondi said.

The studio also plans to dramatically increase its release schedule by complementing its major titles with an expected output of some 20 smaller, specialized movies through its newly acquired New York-based distributor October Films (“Secrets and Lies” and “Breaking the Waves”).

Silver says that while he could have slotted pictures into the fall just to have some product in release, he saw no benefit in doing that.

“In order to have Brad Pitt in ‘Meet Joe Black’ and John Travolta in ‘Primary Colors,’ I had to wait until they were ready to go,” Silver said. “I am serving the profitability and artistic integrity of the movies as opposed to serving the release dates. . . . This is about making money, not about quotas.”

Producer Brian Grazer, whose Imagine Films is Universal’s biggest movie supplier and behind such hits as “Apollo 13,” “Liar Liar” and “The Nutty Professor,” said of Silver: “I think Casey is very good at his job and is selective about making movies. He’s not in the volume business.”

Silver knows that regardless of quantity of product, “even with the best strategies and the best people, if you don’t have the best product, you’re dead.”