Hollywood Goes Big-Budget Bananas

how the studios' love affair with the multimillion-dollar movie is putting your neighborhood bijou on the endangered-species list

Young Chicago film critic to Joseph E. Levine, producer of "A Bridge Too Far": "Why do you waste $26,000,000 on a film like that when you could make 26 artistic films for $1,000,000 each--like 'Rocky'?"

Joseph E. Levine to young Chicago film critic: "Why don't you shit in your hat and pull it over your ears? 'Rocky' was a freak."

Obviously, 26 low-budget runaway hits like Rocky could solve just about everybody's complaints with the motion-picture business.

With 26 cheap hits, theaters might at least make enough money to patch their screens and fix the busted seats. For film fans, the lines wouldn't be so long, ticket prices would go down and they would get a steady supply of new titles all year, instead (continued on page 190)Big-Budget Bananas(continued from page 157) of one cluster of big-budget extravaganzas every six months, reversing a trend toward fewer and fewer pictures--a trend that's fast killing off starving theaters on every corner.

But Rocky was a freak. What's more, it was a freak among more than 300 low-budget pictures made every year, most of which never get to your city or your neighborhood theater. One of Hollywood's enduring mysteries is just what does happen to those little films. There is no question that they are made, because the Motion Picture Association of America officially rates each one of them. But theatrical playoff is largely limited to the 80 major releases a year from the studios, plus a score of larger independent releases. Those 80 major pictures, incidentally, compare with about 500 a year in Hollywood's heyday.

Bluntly put, most of those little films, with an average cost of $300,000, weren't worth seeing and that's why they went nowhere. Yet people consistently question why more small pictures aren't made these days--and they will no doubt be asking long after they wake up to the fundamental changes taking place in the film industry.

Though many small independent operators still try to guide their fragile little butterflies through the hurricane, Hollywood has given up on the small picture. Significantly, every low-budget hit of recent years--Rocky, One Flew Over the Cuckoo's Nest, American Graffiti--was repeatedly rejected by many people before somebody agreed to go ahead. Hollywood's excitement rose only after they were finished.

The primary economic philosophy of Hollywood these days can easily be personalized: Thinking back, before you ever saw Rocky or talked with anyone who had seen it, were you very interested in buying a ticket to see a boxing picture with an unknown star? On the other hand, how many of the recent big-budget pictures--with their name stars and presold, highly publicized themes--were you at least curious about?

Just like you, theater owners aren't too interested in pictures they know nothing about. Unlike you, they will have to put their money down before the picture is finished and before anybody, except those selling it, has even seen an incomplete portion. Commonly, they will have to pay $100,000 and more, sight unseen, for every theater in which they run a big-budget picture. At three dollars to four dollars a head, that means that you and about 25,000 of your friends must march through the turnstile before the theater can hope to break even. A perilous formula for theaters that, however, works quite well for those who produce pictures.

Big Budgets Equal Low Risks

Consequently, the big-budget film with proven ingredients is less a gamble, mainly because theaters are so starved for potential-hit pictures that they will pay enormous front money for anything that smells remotely successful. Offerings like Close Encounters of the Third Kind and Apocalypse Now have been banking money for months from theaters buying blind. If the smell turns sour, it will be the theaters that take a beating, not the producer.

Within a few years, the number of major films per year will be down to a handful. Like the legit stage, these will each be a special event at a large theater, probably carrying a price tag of $10 to $15 a ticket. At the other extreme, also like legit, there will still be a remnant of small film houses, playing old favorites and low-budget, semipro creations.

Between those two extremes, however, there will be nothing to buy a ticket for. The neighborhood-theater business as we know it today will be extinct. The small-and moderate-budget film will continue its detour to the small screen--especially various forms of pay television.

Supported by surveys showing that the broad audience doesn't really prefer the big screen over the small, Hollywood is simply biding time until pay TV can be hooked up nationally, maybe even worldwide. In the meantime, studio accountants and tax specialists can lay off the risks in big budgets, while production executives deal for the best box-office ingredients and the sales staff beats up the beleaguered theater owners.

Three Decisions

Rising from the ruins of the Sixties, the studios arrived at three basic conclusions: First, there was no future in making trendy little films trying to capture public favor; Easy Rider had become one of the most expensive pictures Hollywood ever made by spawning scores of disastrous low-budget imitations such as The Last Movie, The Strawberry Statement and Zabriskie Point.

Second, $10,000,000 invested in one film, combining familiar elements with the technological whiz-bangery at which Hollywood excels, is better than .$1,000,000 invested in each of ten films of outstanding artistry. No matter how good, a typical low-budget picture will lack the technical sheen audiences now demand, and it won't have the presold advantage of name stars and a best-selling literary title.

Third, those who make movies recognized early that theaters were hopelessly antiquated, relying on an increasingly clumsy distribution system. From a finished negative, hundreds of prints must be struck and physically hauled from theater to theater, often damaged in the process, and usually shown on some creaky projector that should have been replaced years ago.

In contrast, television requires only one print that can be beamed into millions of homes at once. Better yet, in pay TV, it can be beamed in for a specific price, generating millions in revenues in one night. Technologically, various ways now exist to accomplish this and cable systems are growing rapidly, but there are still problems to solve in collecting the cash for specific films. In the meantime, however, studios believed there were dollars to be made out in the theaters among the ripped seats and torn screens.

Judging from the phenomenal grosses of recent years--topped by Star Wars last summer--those have proved to be fairly good decisions. The only real error was in underestimating just how profitable a $10,000,000 movie can be. For all its fiscal cool, MCA-Universal was absolutely astounded that Jaws might glean $200,000,000. A week before it opened, in fact, its producers, Richard Zanuck and David Brown, were still trying to tom-tom word that it wasn't going to be the turkey the town was expecting. Twentieth was just as shocked at Star Wars triumph.

Before Jaws, there had been hints of a film audience of some respectable size. The Exorcist, The Godfather and The Sting had all flirted with grosses of $100,000,000. But $200,000,000? Jaws bit into an audience thought to be long lost, proving that the right blend of escapist entertainment could lure people back who hadn't been inside a theater in years.

Because Jaws had been a troubled production from the beginning, with costs mounting from technical problems with the mechanical shark, its success made it easier for other producers and directors to argue persuasively for a little more money and a little more faith in their expensive projects. Moreover, studio executives throughout the town perceived (continued on page 266)Big-Budget Bananas(continued from page 190) that any picture beating Jaws would supply enough profits to sustain their operations for years. So they heeded the creators' requests, loosening the budgets for one more side stop in Borneo. To hell with Academy Awards; let's win one for Wall Street.

The results were onscreen all summer, the greatest concentration of big-budget pictures in the history of the film business: A Bridge Too Far at $26,000,000, Sorcerer at $20,000,000, The Deep at $15,000,000, Exorcist II at $12,000,000, plus several in the $9,000,000 to $10,000,000 category, such as Star Wars, New York, New York, Rollercoaster, MacArthur and The Spy Who Loved Me. Within just a few weeks, Hollywood released over $150,000,000 in films.

The survivors stayed the summer and now another crush of big films is hitting the market, paced by the $18,000,000 Close Encounters of the Third Kind, with the $25,000,000 Apocalypse Now and the $30,000,000 Superman bounding just over the horizon.

The money game

From concept to screen, there are four basic economic plateaus of film making: raising the money (finance), shooting the picture within a reasonable cost (production), selling it to theaters (distribution) and reselling it to the public (exhibition). In the old days of dominant studios that also owned theater chains, dollars flowed in one long fluid motion, with box office from previous films generally paying to produce new ones. Producers, directors, actors, ushers and cashiers were all just salaried hired hands who kept the dollars moving.

Today, everyone is a private entrepreneur and the key individual on the business side of film making is the independent producer, who puts all the financial and creative ingredients together. Unless he takes a renegade route, he's likely to deal ultimately with one of the Big Six distributors: Columbia, Paramount, 20th Century-Fox, United Artists, Universal and Warner Bros.

Popular imaginations to the contrary, studio executives and producers do not usually gather around a table and decide the time has come to spend $20,000,000. Though few possess Ph.D.s in economics, most have mastered the fundamental advantage of buying low and selling high. They, too, attend the Hollywood cocktail parties where everyone marvels at the simplicity of making Rocky or American Graffiti for a couple of million and selling it for 50 times that. Back at the office, however, they rarely recognize a Rocky in the works. In general, executive careers are not made by pushing small projects by unknown film makers. There will be time to seize credit for that later if the film is a winner. Right now, though, the v.p. is looking for various multimillion-dollar chunks to buy this best seller, get that top writer, drop a director who wants $8,000,000 to star his girlfriend in a surrealistic adaptation of a Ukrainian short story and lure Barbra Streisand to a dinner party so the chairman of the board from New York will be assured his v.p. knows one movie star personally.

In the big leagues, most typically, the producer takes an idea to a major studio, which underwrites the production from the start. Leaving itself various places to pull the plug, the studio will first pay for a script, some preproduction artwork and location scouting and, finally, will give the green light for casting and production. In the old days of booming production, studios often moved too frantically and had to shelve a lot of lousy films after they were finished. That rarely happens anymore; studios commission many more pictures than are shot. But once before the cameras, a studio picture is usually completed and released.

All of the majors function as both producers and distributors, meaning they become deeply involved usually in the financing, production and sale of the producer's film. And the producer can rest assured he will pay nicely for the studio's service in each area. When the first dollars start rolling back from theaters, the distributor takes 30 percent to 40 percent off the top as his fee. Next, he deducts all costs of prints, advertising, interest and other expenses. His third cut comes in taking whatever percentage was agreed on in the financing arrangement. (If the picture was also shot on the studio lot, the landlord will also take 15 percent to 25 percent of the budget for that service.)

What's left is the producer's share, though he still probably owes additional sums to others he's let in on the deal. If anything is left after that, he can make a deposit to his own bank account. Don't shed tears too quickly for producers, however. Usually, somewhere in the production budget is a six-figure producer's fee that most working stiffs could live nicely on for a long time. The producer will bank that fee even if the picture flops.

To raise the money it needs to operate, the studio has three main sources: box office, banks and private partners. In 1975, when Columbia was raising scratch for Close Encounters, films were still enjoying a newly popular status as tax shelters. But Congress was wise to the scam and it seemed quite clear that that would be the last year for enjoying its benefits, creating a year-end rush to get pictures started.

Columbia also drew down the usual bank loans and found a partner overseas in EMI Films, the big English showbiz conglomerate, plus Time, Inc., on these shores. With production money thus assured, Columbia waited until the film was nearly in the can before offering it to theaters.

While Steven Spielberg was still busy cutting the film, Columbia sent its first notice to theaters that it was up for sale. The previous record price for a blind bid was the $125,000 per theater Paramount got for King Kong last Christmas. Columbia was so confident it could top that that it didn't even name a figure in some of its early letters, surmising correctly that competition among the chains would drive the price higher. Within two weeks of the letters, Columbia was assured that its entire investment in the picture had been recouped. The risk thus shifted to the theaters.

Coppola's Erratic Course

To finance Apocalypse Now, Francis Ford Coppola went an entirely different route, peddling the unfilmed picture to distributors around the world. This is not easy to do unless your sales kit contains a lot of names easily recognized in foreign tongues. Coppola's own rep was a good start and in the conversations abroad, many other favorite names were easily bandied about, such as McQueen and Brando and Pacino. Before long, Coppola had $25,000,000 in hand to make the picture, including $7,000,000 from United Artists for the right to distribute it in the U. S. and Canada. That is not borrowed money. For the price, the distributors have assumed the risk, which they'll pass along to the theaters. If the film does not do business at the box office, all that's hurt is Coppola's ego.

Back home from the overseas sales trip, Coppola found that some of his well-known superstar friends were not nearly so willing to spend several months in the jungle as he had led his foreign customers to believe. McQueen wanted $3,000,000 for three weeks' work, a sum Coppola thought outrageous compared with the $1,000,000 he was paying himself to direct. Of all the big bankables, only the Godfather himself, who owed his comeback to Coppola, could be persuaded and Brando signed on for $200,000 a week.

Faced with those rejections, Coppola had no choice but to return abroad with various translations of "Gee, fellows ..." and give back several million dollars raised on the promise of names he couldn't get. But with himself and Brando, he still emerged with $7,000,000 in foreign funds, plus U.A.'s $7,000,000. Enough, it would seem, to make the film he had in mind.

Once in the Philippines, however, Coppola kept changing that mind as he wrote and rewrote the script, a loose adaptation of Joseph Conrad's Heart of Darkness. So loose, in fact, that Coppola has the only clear idea--at least he'd better have--of what takes place in the Vietnam jungle as Martin Sheen pursues the maddened Brando.

Before long, the dispatches from the combat zone were as horrifying as the war itself. Not really, but the analogies between the film and the original debacle have been impossible to resist. None of the initial strategies worked; the elements--including a typhoon--rendered U. S. film-making technology useless; General Coppola was driving forward with no objective the troops understood; casualties--including a heart attack by Sheen--were mounting; and costs were unbelievably out of hand.

At $100,000 a day, plus the cost of pasta flown in from Italy and the additional thievery of the locals, Coppola ran through his initial $14,000,000 in a hurry. And a film out of money is a pitiful sight, indeed. Though usually with much smaller, nonstudio ventures, this tragedy strikes several times a year in Hollywood. The cameras stop, the stars wander hollow-eyed through the countryside and scores of suddenly unemployed crew and staffers are on the phone, trying to retrieve the job they turned down for this one, while the producer assures columnists the shutdown is only temporary.

But Coppola is nothing if not resourceful. He's also rich. Rich enough to take the ultimate gamble, the one that every producer insists should be avoided at all costs: He is using his own money to finish the film. Coppola pawned everything he owns to U.A., which lent him another $10,000,000. U.A.'s ticket covers Coppola's San Francisco house, his business holdings and fertile acreage in California's wine country.

Joe Levine--the Old Pro

Though Coppola may well survive this travail, his first venture into international film finance looks clumsy alongside the masters such as Joseph E. Levine, who had his $26,000,000 A Bridge Too Far sold for $27,000,000 before it opened. With 493 films to his credit--including respected little "art" films and multimillion-dollar blockbusters--nobody understands international film finance better than Levine.

Levine also had superstars imposed upon his project, but, unlike Coppola, he nabbed most of the big names: Robert Redford (at $2,000,000), James Caan and Ryan O'Neal ($1,000,000), Laurence Olivier, Sean Connery, et al. But not McQueen, who held out for his million a week, plus percentages.

"When I started out, the picture was going to cost $20,000,000. But I hadn't counted on getting that cast," Levine explains. "In dealing with distributors, the first thing they wanted to know was, 'Who's in it? Can't you get Redford? If you get Redford, I'll give you this much more.' "

Using his own money for seed, Levine launched the film, waiting two thirds through photography before pinning down the distribution deals. "At that time, when the entire bank roll is committed, you do get a little nervous on the way to the bathroom at night." Levine took a lot of heat from the industry, angry at the superstar salaries he paid, complaining that bit players would soon be demanding six-figure salaries. But Levine has no apologies.

"The actors didn't get any percentages--that's why I had to give 'em all that money. I looked like a schmuck, but I wasn't. I couldn't give 14 guys a percentage. There wouldn't be any left for me."

When Levine was ready to fish for distributors, he took a splashy ad in the trade papers and the International Herald Tribune. "I announce the picture and let them come to me. I never go hat in hand and wait for them. The major companies can be tough bastards if they've got you by the balls. You've got to get them by the fucking balls and remain in control."

Though proud of the artistry and sheer logistical triumph of Bridge, Levine nonetheless takes no sentimental attitudes toward world sales. Before the film's opening, he calculated the probable attractions in a film dealing with a stunning Allied defeat: "I don't know how it will do in the U. S., which swept the whole event under the rug. But the Japanese will love it because they like to see white guys kill each other. The Germans will love it because they won the battle. And the English will like it because they love to celebrate defeats."

United Artists coughed up $15,000,000 for Bridge and the Japanese paid nearly $4,000,000, with the remainder raised around the world. For its $15,000,000, U.A. was assured of keeping the first $22,000,000 coming into the till before having to split any revenues with Levine. That's a lot of money to wait for, which is why Levine likes to get his profit out front.

Clearly, as all of these case histories demonstrate, nearly everybody connected with films these days is buying those qualities that only big dollars can deliver. Levine, who produced one of the sleeper hits of all times in The Graduate, puts it plainly: "There's no way I could sell The Graduate in today's world market. A little picture about American social customs, starring nobodies. Who'd buy it?"

If Levine can turn a profit before a picture opens, so can others. Or at least they can cushion the risks substantially. Even a total turkey like Lucky Lady, which cost $12,000,000, will easily earn its money back for 20th. Though the filmgoing audience largely hated Lady, that isn't all-important to the fate of a picture. But how can that be? In our land of supply and demand, there must be winners and losers. And there are. Yes, there are, indeed.

How to lose with winners

Scenario: It's summer along busy Hollywood Boulevard--one of the nation's greatest concentrations of first-run film houses--and let's pretend you own the Pacific Theater. Knowing that The Exorcist has grossed more than $100,000,000 since 1973, you fret but finally come up with the $100,000 that Warner Bros, wants in front money for the sequel, Exorcist II, which isn't ready for you to see. Though that's a sum you will never get back if nobody shows up at the turnstile, it seems a reasonable risk. Except no one tells you that both the producer and the director of Exorcist II disliked the popular original and are determined to make a totally different picture. They do. And your customers are tossing popcorn boxes at the screen and coming out urging those in line to get their money back before it's too late. By the third week, your box office is off 80 percent.

Down the street, your competitor at the Chinese is in an equal panic, even though he has the season's hit, Star Wars, which he bought relatively cheaply for about $35,000 because 20th Century-Fox didn't know beforehand how good it was. Unfortunately, he didn't know it was going to be a blockbuster, either, and booked it only as a four-week buffer between Black Sunday, a previous turkey he lost money on, and Sorcerer, a film he also has a lot of dough riding on. So your competitor shifts Star Wars to a smaller theater, making room for Sorcerer at the Chinese, where business falls by half.

So you and the competitor sit at the local bar and compare notes. By careful planning, you have sunk the kid's college fund in one big disaster and he has managed to finesse the summer's only breakaway hit as a short filler between two disasters. With each of the films involved, of course, the distributors have your money and they aren't even around to tip the waitress.

That's why theaters throughout the world are going broke. If you want to make a film these days, you have at least two or three options on how it might be shown to the public. But if you own a theater, there is not much to do with it except screen pictures. And when panic strikes in Needle Park, nobody wants a long discourse on what happened to the supply. They will kill for a fix. Themselves, if necessary.

The Rise and Fall of Theaters

Theatrical exhibition is one of the last laissez-faire market places in America. Though watched constantly by a special office in the Justice Department's antitrust division, enforcement is feeble and power plays, secret alliances and open economic warfare are commonplace. Congress never interferes, because lawmakers' interest in the theater business is almost solely limited to pornography, which is all they get complaints about. Any other kind of lobbying is met by an equal and opposite reaction from another theater interest, ending in stalemate.

The balance of power has shifted back and forth since the first nickelodeon owners went into production to supply their own screens with pictures. That evolved into the great pretelevision era of Old Hollywood, when the major studios owned or directly controlled vast circuits of theaters, supplied by an endless flow of fresh pictures, tailored to cover the entire audience spectrum.

When the trust became overbearing, the Government stepped in and severed production and distribution from exhibition. Producers and distributors could link up in many ways or even be one and the same. But once a film was finished, it had to be sold at arm's length to theaters owned by someone else. That might have been a good move, but we will never know. Just as the separation was accomplished, television arrived to start theaters on the long slide.

After a difficult adjustment, producers and studios have prospered well in TV. But theaters were closing by the thousands in the Fifties, until the baby boom brought a new audience in the following decade and a chance to show subject matter that offered an alternative to the home screen. Drive-ins and suburban theaters boomed, with more and more opening as multiscreened operations in one location. Now free of studio muscle, however, theaters found themselves under a new blackjack held by shopping-center developers. And the message was familiar: The old studios used to say, "If you want this good picture, you'll have to buy five dogs to get it." The realtors told them, "If you want this location in a good shopping center, you'll have to build five theaters in locations not so good."

The result was an explosion to about 16,000 screens now out there waiting for the majors to release fewer than 100 prime pictures a year, of which only a handful have a presold smell of success.

Through the years, producers and distributors had complained bitterly that much of that expansion was financed with their money. Many theater circuits were notoriously slow in forking over the distributor's share of the box office. They also had no guilt about wriggling out of the terms of their commitments when they thought the film was less than successful. And some were known to under-report a dollar or two just for good measure. When distributors would run spot checks on theaters, they would often come up with fascinating statistics. Like one drive-in whose tally showed that each car on the lot that night could have had only .9 occupants.

This still happens all the time to small film makers trying to distribute their films themselves. It's a general rude of the business that the only sure way to collect money off your first film is to have a second hit right behind it. If the exhibitor fears he may not get the second picture, he will be more honest about the first.

Revenge

On the small picture, slow pay and other chicanery are still a problem. But when it comes to the big picture, with all the suspected ingredients for a runaway hit, the distributors take their gleeful revenge for all the old wounds inflicted by exhibitors. And that's almost enough in itself to make the big-budget picture popular in Hollywood these days.

Though there are several instruments of torture, the previously mentioned blind bid and the nonrefundable guarantee have become the favorites. But the guarantee is just the first taste of the lash. Next comes the minimum run, which establishes how long the theater must keep the picture on the screen--even if the house is empty. King Kong asked for ten weeks; Columbia stretched it to a record 12 for Close Encounters--three whole months.

The actual box-office take is split on a complicated formula, also heavily favoring the distributor. First dollars go to pay the basic weekly operating cost of the theater; otherwise, they would all be broke by now. Of the next dollars, 90 percent goes to the distributor and 10 percent is kept by the theater. Of course, the distributor doesn't actually take any more cash until his share exceeds the guarantee already paid him. There are also additional percentage splits called for in the bid agreement, with the distributor gradually taking less the longer the picture runs.

Friendship doesn't count. Last January, one of U.A.'s oldest and dearest customers, the Kerasotes chain in the Midwest, submitted a winning bid for A Bridge Too Far, agreeing to pay $200,000 to open the film in its area, with the cash due upon opening five months later, when the first prints would be available for viewing. After signing the deal, however, circuit head George Kerasotes got to see the film in May because he sits on the board that handles rating appeals. Apparently not thrilled with what he saw, he quickly notified U.A. that $100,000 would be a fairer price.

Crying welsher, U.A. told Kerasotes he wouldn't get Bridge at all and began pulling its other films, such as Rocky, out of Kerasotes theaters. U.A., of course, counted on--and got--immediate invitations to the dance from Kerasotes' competitors. Seeing that his brethren theater owners were preparing him for the pot, Kerasotes caved in and came up with the 200 grand he had originally bid.

That is precisely why Levine and other movie moneymen believe the big dollars for superstars, successful directors and best sellers are a solid investment. That's the money that seems to come back the quickest from theater owners bidding on the familiar. Who's going to advance $100,000 per theater on Stallone before Rocky? And when they don't, those Rocky millions can be hard to collect after the picture opens.

Witness the trouble 20th has had with Star Wars, another sleeper that couldn't be presold for heavy up-front money because its drawing power wasn't immediately apparent. When the lines started forming, the theaters got their little bits of front money back in about 14 minutes. By the end of the first week, they were sitting on a mountain of dollars rightfully belonging to 20th. That is the point at which 20th began hearing of all the money theaters lost on Lucky Lady and wouldn't it be fair to let them hold on to a slightly bigger chunk of Star Wars as compensation? In Hollywood, there is many a producer who complains of the profits lost to him in paying the price for somebody else's previous flop.

At any rate, there aren't enough Star Wars to go around. Many of the major circuits are operating at heavy losses, avoiding bankruptcy by pushing popcorn and candy prices to exorbitant levels. At least three chains went under in the past year and, in city after city, theaters are closing for good or shutting down for long stretches between the holiday release periods. Just as examples, Wilkes-Barre, Pennsylvania, had four downtown theaters at the start of 1977; today it has one. Toledo, Ohio, closed its last remaining downtown theater last May. With urban spread, drive-ins are closing because they can more profitably be converted into shopping centers. The few attempts by theaters to underwrite their own productions have generally been disastrous, adding to their financial problems. Their cash squeeze has aggravated the growing indifference that many theaters were already showing their customers. Ramshackle theaters, with poor sound and projection, are common; customer complaints are ignored and rowdiness is often excused as part of the "group experience" of movie attendance.

Consequently, despite the bulges by the big hits, regular movie attendance slides on down. From a peak of 4.4 billion tickets sold in 1942, attendance dropped to 3 billion in 1950, 1.3 billion in 1960 and 920,000,000 in 1970. The super-smashes of 1974 and 1975 briefly edged ticket sales back over a billion, but they're heading down again, registering 960,000,000 sold last year.

The Future

If every theater in the country should close tomorrow, however, Hollywood would suffer but survive. Television is already the town's dominant industry and the money spent on expensive films pales by comparison with the sums committed to TV production. Though economically and psychologically the three commercial networks dominate TV, technically it's no big deal to link many independent stations via satellite for one evening or more of "fourth network" programing like the Nixon-Frost interviews. In addition to their regular network programing, 1977 saw studios such as Universal and Paramount leap into the fourth-network concept with a line-up of original material for such satellite link-ups of independent stations. Technically, these satellite setups are only a half step away from the producers' dream: pay television on a global scale. How simple life will be when they can strike just one print of a film and beam it into millions of homes at once.

"I could put Bridge on and make $50,000,000 in one night," Levine asserts. "Sure, I like to see my picture shown on a big screen, in the best possible environment. But a week after it's released, it's out of my hands, anyway. The people don't give a shit. Most would as soon see it at home as in one of those toilets where the projectionist is screwing an usherette, while the picture runs off the screen onto the wall."

A secret Gallup Poll recently commissioned by the Motion Picture Association of America found that a "preference for a theater for most movies is not heavy. A majority either prefer TV or feel there is no difference." What's more, the survey found that today's most loyal theatergoers will be the best customers for films on pay TV and video players that allow them to record their favorite films.

So much for the mystique of movie-going. It's definitely there, but the experts feel it can be inspired only sporadically. In reality, that will mean event pictures screened in theaters with the most modern facilities. And the moviegoer will pay extra for the experience, just as the legit-theater buff has grown accustomed to $15 seats for top presentations.

For now, there is no satellite linkage of pay TV. But cable television, the first serious form of pay TV, is now firmly rooted in about 6000 American communities. Their pay-TV subscribers merely pay a flat fee that covers all the films supplied to them. In turn, the cable operators buy the films from established distributors and the money flows from there back through the usual channels. As yet, nobody has devised a sensible system for charging a specific price for a specific film. But that's a minor technical lag that's sure to be solved when enough homes are linked up to make a solution economically necessary. Some sort of meter and a satellite tuner are two obvious possibilities.

Practically nonexistent a decade ago, cable is spreading fast, hampered only by the high cost of laying wire. This drawback will either diminish or be eliminated by satellite or telephone hookups. The other major roadblocks have been Federal Communications Commission restrictions on cable, encouraged by networks fearful of pay TV's potential competition. But a recent Federal Appeals Court ruling knocked down many of the FCC barriers, freeing cable to grow even faster.

Hollywood is ready for the boom. When commercial TV first arrived in the Fifties, the studios paused too long and were locked out of the gravy by the networks. With only three TV markets for their films, producers haven't gotten top dollar. They have, in fact, gotten bottom dollar and they are determined not to repeat that mistake by missing out on pay TV.

The rush is on. Warner Communications owns a cable outlet; United Artists and 20th have joined forces in Hollywood Home Theaters to operate and program cable systems; Universal is heavily into fourth-network production and video discs. Paramount recently acquired the Hughes TV Network, not a cable system but nonetheless a prime foundation for satellite linkage, and is committing millions to first-run programing, including films.

Where it once spoke softly of pay TV for fear of antagonizing a counterdrive from theaters, Hollywood is now rallying around cable in anticipation of a much stronger assault from free TV. The arguments are subtle but significant, such as a U.A. executive's recent testimony to Congress that cable should not be looked upon as a more expensive form of television but as a cheaper form of movies. And hearts stopped in theaters across the land.

Facing the Inevitable

Theater owners themselves are starting to face the inevitable. "Frankly, the immediate future doesn't look bright for movie exhibitors," concedes Marvin Goldman, a savvy Washington, D.C., exhibitor who is also president of the National Association of Theater Owners. "Cable television, large-screen television, video cassettes and discs--pose a serious threat to theaters. Nevertheless, I am convinced movie theaters will survive in the long run. They will be different in design and programing. They will offer sophisticated 3-D presentations or holographic projection systems. Most important, they will provide the unique opportunity for the shared pleasure of a night at the movies."

The old Bijou on the corner will never be the same again. Picking up a newspaper a few decades from now, the average moviegoer may well choose from screen hits such as these:

Star Scars: Handsome leading man allows himself to be mutilated onscreen, a one-day acting job for which he is paid $10,000,000. But plastic surgery will have him whole again in plenty of time for his next film, since he does only one picture every eight years.

The Snore of the Crowd: Giant animals and enraged natives threaten average American citizen, thrown into their midst on a mysterious island. For $25, each patron gets to play the leading role, through sleep-induction connections at every seat. The less adventurous may switch to a second feature in which they can make love to the screen idol most desired.

Airport '99: Wide-bodied 787 crashes into crowded theater, projected there by holography to the thunder of Sensurround. In their film comeback, graying, distinguished Robert Redford helps plump Tatum O'Neal find an aisle to escape through just before the chandelier collapses on his head. Spilled popcorn will be replaced at half price of four dollars for the giant size.

For those wanting nothing more than a good movie, there are also a couple of revivals of The Sting and The Godfather, plus a few shoestring underground pictures and foreign imports that couldn't have cost more than $5,000,000 to make.

And that's it. If you don't like it, stay by the fireplace and watch one of the 12 new films being offered this week on your home-entertainment center. Hollywood doesn't care how you choose to spend the evening, because it has you covered every way.

"Within a few years, major films will be down to a handful. The neighborhood theater will be extinct."

"The results were onscreen all summer, the greatest concentration of big-budget pictures in history."