Hollywood. People come here from all over the world in search of fame and fortune. Some find both. Most find neither. But scrape off the Tinseltown stardust and there's a plain old biz beneath the show: a film industry that in recent years has experienced both feast and famine. Paramount's 1997 Titanic raked in $600 million at the box office and put director James Cameron on top of the world. In 1998, Universal's Babe: Pig in the City took in $18 million, cost a porky $85 million to make and (along with a few other underperforming titles) cost Universal Chairman Casey Silver his job. In Hollywood, the technical term for that kind of ROI is bomb.
How to avoid the flops and make only the hits -- that's the holy grail in Hollywood. Technology hasn't yet provided the formula for a guaranteed box office smash; most people think it never will. In fact, Hollywood regards technology with a certain ambivalence. The dream factories worship creativity, not technology -- people, not machines. The movie business is traditionally based on intuition, inspiration, negotiation and the handshake.
None of those things automate easily. So even as more and more technology shows up on the screen, sometimes to great effect (1999's The Matrix), and sometimes not (1999's The Mummy and Wild Wild West), studio CIOs every day confront an acute version of the standard IT conundrum: when to push against corporate culture and tradition, and when to go with the flow as they strive to provide competitive advantage with their information systems.
"It's a very old business, very non-process-oriented, and we've had to work around that at times," says Justin Yaros, CIO of 20th Century Fox. "But it's hard to argue with some of the efficiencies IT can bring."
A film passes through many stages and many decision points before it arrives at the local 24-screen megaplex. Those decision points provide a showcase for Hollywood IT, its efficiencies and its influence on the creative process.
"Scene 1 - A Film is Born"
ACQUISITION A movie starts with a concept; the concept becomes a pitch; the pitch becomes a screenplay. Let's call our script Indiana Bob and the Mayan Enterprise Architecture Mystery.
20th Century Fox brings in 40 to 60 new screenplays every week, and that's where IT first steps into the picture. Indiana Bob gets scanned into a system Fox calls S-Files, a play on The X-Files, Fox's popularly paranoid network TV show. S-Files is a 3-year-old Notes-based document management system. Indiana Bob is assigned to a reader who writes a synopsis of the story, classifying it by genre, author and so on. Every Fox employee involved in story development, up to the corporate chairman, works out of S-Files. Users query the system to find particular writers or all the scripts in a given genre. So if Tom Sherak, the chairman of the 20th Century Fox Domestic FilmGroup, decides audiences are ripe for an action-adventure thriller about a vanished South American empire and its infrastructure standardization challenges, up pops Indiana Bob.
After Bob gets green lighted, the project goes from S-Files into Deal Maker, a custom Fox application that the legal and business affairs departments use to structure and track contracts with directors, writers (known in Tinseltown parlance as "above-the-line talent") and actors. Again, Fox can query the data in Deal Maker, allowing the studio to comppare potential new deals with the old. Yaros calls it "sort of a competitive tool vis-à-vis the talent," rather than against other studios. For example, if the man behind the Darth Vader mask wants a 50 percent raise to appear in the next George Lucas prequel, Deal Maker will give Fox execs the going rate for performers whose faces are never seen and whose voices are dubbed.
Star Wars looms large in Fox's corporate legend. Visitors to Fox's gated lot in Century City are quickly reminded of the 1977 blockbuster that effectively saved the studio. The gargantuan sound stage facing the entrance bears the five-story painted likenesses of Vader and other Star Wars characters. Yaros, whose modest office building is tucked into the shadow of said sound stage, proudly notes that Fox has released half of the top 10 blockbusters of all time.
PRODUCTION So the deal gets done. The director and stars have signed on, and the film is really going to happen. Next, a series of systems come into play that Yaros puts under a "proximity and story tracker" umbrella. The film production process is a project-management challenge that IS professionals can appreciate.
The producer and director are responsible for figuring and refiguring budgets. Financing comes next, as the studio looks for partners to share the risk. The production company assembles props and rounds up costumes. Location scouts scout locations. Producers schedule and reserve sound stages. If the movie is being made in another city, Fox needs to apply for permits and negotiate with local trade unions. Special effects are outsourced. The producers assemble a team of accountants, cinematographers, electricians, gaffers, publicists, script girls, first and second unit directors, and on and on into the hundreds.
Many tasks under way, many contractors to pay, aggressive completion dates targeted with no guarantees. If you've got Brando contracted for seven shooting days in Manhattan, the sets had better be ready on time and the caterer had better be there because Brando is headed back to his Pacific island after those seven days are up whether or not you've shot all his scenes. Fox applications keep tabs on the various components and automatically generate appropriate payments as production managers check off steps along the way to the film's completion.
DISTRIBUTION AND EXHIBITION It is a sad thing to make a good movie and then release it at the wrong time. The aforementioned talking-pig sequel Babe, among other problems, got roasted in the afterburners of Disney's A Bug's Life and Paramount's Rugrats children's movies. MGM/UA played it smarter with The Thomas Crown Affair last summer. The film's original June release date was moved to late summer to avoid going up against Paramount's The General's Daughter, starring John Travolta, and Fox's Entrapment, a Sean Connery flick "with the same plot as Thomas Crown -- James Bond stars as art thief," according to Gitesh Pandya, editor of movie site Boxofficeguru.com. By dodging direct competition, Thomas Crown pulled in a solid $14 million its first weekend.
There are plenty of complicating factors, some more obvious than others, in choosing a release date. World Series weekends are not great for anything. Ditto Super Bowl Friday, Saturday and Sunday. Scary flicks do better around Halloween, and Santa gets a frosty reception in July.
Choosing the right theaters is also a challenge. Movies directed at teens score better at mall theater locations than at art houses. Action flicks are not optimally positioned in houses with an older audience demographic. Fox uses two key applications in the scheduling and distribution stage. One is 8-Ball, a theatrical data warehouse Fox developed internally (with the assistance of US Web/CKS). Fox distribution reps access 8-Ball over the corporate intranet to help determine which thheaters in their territory are most appropriate for a given film. 8-Ball's data, for instance, will show which local cinema draws a particular audience. That science doesn't take away all the art -- after all, what if Indiana Bob's Meso-American subtitles give it a better shot with arty theatergoers than with the testosterone crowd? That's a call Fox's people still have to make on their own.
Once the preferred time of release and favored exhibition sites are chosen, the actual booking, scheduling and accounting is handled through another application, developed in conjunction with Hollywood Software, dubbed Falcon (after Han Solo's Millennium Falcon, "the fastest hunk of junk in the galaxy"). Settling on the split -- how much money is kicked back to the studio and how much stays with the exhibitor -- is another negotiation. And, like other studios, Fox often asks for a guaranteed minimum onscreen stay for each of its films. (For last summer's Star Wars prequel, Episode One: The Phantom Menace, Lucas demanded an unheard-of six-week commitment from exhibitors. Lucas also negotiated an unbelievable 80-20 split; that is, 80 cents on every box office dollar went to Lucas.)
Terms can grow quite complex. Falcon keeps track of the deals and also keeps tabs on the copies of the film being distributed. Each film's weekend performance is updated immediately in Falcon, which means Fox executives have current numbers to look at every Monday.
"A lot of decisions get made Monday morning," Yaros says: whether to pull a poor performer, pump in more marketing money, extend a sleeper's run or put a smaller film in wider distribution. Yaros describes Falcon and 8-Ball as "the mainstay of the distribution process" for Fox.
MARKETING The biggest splash right now in movie marketing comes not from a studio's internal system, but a very external one, the internet. Last year's The Blair Witch Project opened eyes industrywide to the power of internet marketing. Hollywood executives snickered when Artisan Entertainment, a small ($400 million) company, paid a million dollars for the right to distribute the low-budget film. But Artisan had the last laugh. Blair Witch generated over $150 million in ticket sales, thanks largely to a low-cost net-based marketing campaign, notably including a site that intentionally left visitors wondering whether the story was fact or fiction, and an infectious word-of-mouth effort aided by e-mail. Web movie discussion boards hummed with Blair Witch anticipation long before the movie hit theaters. "Blair Witch was pivotal. It proved that the internet can drive lots of business to the theater. That's going to have a great impact over the next few years," says Boxofficeguru.com's Pandya.
Yaros says Fox -- like the other studios -- hasn't yet figured out all the ramifications of the internet for the movie business; he has more questions than answers about the future of the web as it applies to the industry. But the effort Yaros is spearheading to define Fox's internet strategy has received plenty of attention from the top of the corporation. "Senior management has become very receptive to these ideas," says Yaros. "They saw what happened to the music industry [with the net threatening the very existence of today's record labels] when that industry was myopic about it." That's a nice turnaround in attitude toward technology for a company that Yaros describes as being "an IT wasteland" prior to a mid-'90s management change.
Applications like S-Files, Deal Maker and 8-Ball clearly make the movie-making process more efficient. And the internet may open new possibilities for creative marketing. What these technologies don't do is guarantee that the script is great, the director right or the performances Oscar-worthy. "You can take the best script S-Files churns out and still make it into a flop," Yaros says. On the other hand, Yaros iisn't content to limit technology's role to the back office. "Bringing IT into the creative process -- that's the ultimate IT-business alignment in this industry," he says.
"Scene 2 - Stars Rocked by Digital Divas"
The sexiest technology in Hollywood has long been the stuff that shows up on the screen -- from 1933's stop-motion animated King Kong to Ray Harryhausen's work in the Argonaut and Sinbad movies in the '60s to Industrial Light and Magic's Star Wars special effects in 1977. More recently, computer-generated (CG) characters have defined the cutting edge. Roger Rabbit made the scene in 1988 with humans and animated characters sharing the screen. Then in 1993, Silicon Graphics-created dinosaurs in Universal's Jurassic Park took CG characters another step forward. Pixar Studios went all the way in 1995 with the Buena Vista-distributed Toy Story, the first all-computer-generated feature film.
The next frontier: CG humans.
Toys and dinosaurs, impressive though they may be, are child's play next to creating a convincing CG human being. Audiences are extremely adept at spotting a fake, says Ivan Gulas, cofounder of PacTitle/Mirage Studios (PTM) in Los "After dinosaurs and toys, the next frontier for PacTitle/Mirage Studios cofounder Ivan Gulas is computer-generated performers."Angeles. (Gulas has recently terminated all of his involvement with PTM. He has founded a new company, MirageQuest.com in L.A.) Historically, the mainstay of PacTitle's business has been the titles and credits that roll at the beginning and end of a film -- by Gulas' estimate, PTM provides that service for 80 percent of all Hollywood's feature films. But the company's hot project now is a software toolset called LifeF/x, which generates convincing animated humans.
Moviegoers in late 1997 saw some of PTM's handiwork strolling around the deck of the Titanic during long shots.