The Keys to the Kingdom (55 page)

Other problems included the Asian economic slump, which hurt sales of Disney merchandise abroad. And there were fears—groundless, at least for the near term—that the U.S. economy could falter, hurting business at the theme parks. Not only could attendance slip, but a tough economy could make it difficult for Disney to raise ticket prices—the very tactic that had helped its profits reach such dazzling heights after Eisner took over in 1984.

 

THE REVOLVING DOOR
at Disney seemed to be spinning all the time. Peter Rummell, the head of the real estate division who had taken over Imagineering, had left in January 1997 after an eleven-year run, to run
St. Joe Corp., a real estate concern. He was just one of many. Eisner increasingly surrounded himself with a certain type of employee and often style seemed as important as substance. “Michael has what he thinks of as the image of a successful executive,” says one former Disney insider. “Six feet tall, guys that look great in suits, that are well read, calm, eloquent. That's what fits his image.”

Eisner also became more isolated than ever. On one hand, he had devoted himself to building the company. He had merged his identity with Disney's, so that what was good for the company was good for him, and vice versa. But like many powerful men, he didn't want to look seriously at the company's well-being beyond his own presence there. And Disney was, with the possible exception of Rupert Murdoch's News Corp., the major media company most identified with its chairman and chief executive. Michael Eisner was one of the most famous CEOs in the world.

In a couple of years, Disney lost chief financial officer Steve Bollenbach as well as his successor, Richard Nanula; head of strategic planning Larry Murphy, who had been at such bitter odds with Katzenberg; and Geraldine Laybourne, head of cable programming. ABC executive Steve Burke—who had been seen as a particular favorite of Eisner's—left for the cable company Comcast. Burke, the son of former Capital Cities/ABC owner Dan Burke, had turned down the opportunity to be president of ABC, and his resignation was perceived as an especially severe blow—seen by some television veterans as a no-confidence vote in the future of ABC and the network business generally, as well as a sign of doubt about his own future at Disney.

“The brain drain is pretty serious,” commented one of the many who left in recent years. “This is a huge, global brand that has to come to grips with the concept that this guy's not going to live forever. In concept, it's such a great company that they attract very talented executives quite easily. The difficulty comes with keeping them. Because for Michael Eisner, it's all about being able to stay there forever.”

 

IN SEPTEMBER
1998, Eisner's autobiography,
Work in Progress,
was published. It was an ill-timed and ill-starred endeavor. Not only was the company having its most serious problems in years, but the nation was obsessed with the Monica Lewinsky scandal. (The book was to have been
excerpted as the cover story of
Newsweek,
but the magazine changed its plans when the House of Representatives rushed to vote for an impeachment inquiry.)

Why the usually pessimistic Eisner even considered writing his own biography while still sitting as the chairman of Disney almost defied explanation. It was completely out of character—or it showed how much the Disney chief had changed over the years.

Although a friend said the final version of the book was “sanitized,” the Katzenberg camp was furious. Katzenberg's allies had been assured by Eisner that Katzenberg was not mentioned, but a glance at the index showed more than twenty-five references to him. He was portrayed as jealous of Eisner, and increasingly secretive and uncooperative.

The book received lukewarm reviews from critics who found its lack of introspection unsatisfying. The
Los Angeles Times
said those looking for tantalizing morsels would “undoubtedly find the book a yawn.” The
New York Times
said some of Eisner's descriptions of events were “so calculatingly self-serving that they lack[ed] both credibility and nuance.” His ego, the
Times
concluded, “leaves little room for perspective.”

The book didn't sell well. Within a few months, it was clear that the book had been a grotesque miscalculation for Eisner. It was an expensive mistake in every sense of the word.

 

WHILE DISNEY WAS
suffering, DreamWorks wasn't exactly flourishing. With much hoopla, the company had announced its plans to be the anchor in a partnership that would build a 1,087-acre, ultra-high-tech, $8 billion community in Playa Vista, near the Los Angeles airport. DreamWorks intended to construct fifteen soundstages on the barren site where Howard Hughes had built his
Spruce Goose
seaplane. But the project bogged down in battles with the developer and warfare with environmentalists. It became an ongoing distraction for the DreamWorks partners.

While the struggle over Playa Vista dragged on, the company continued to be based on the Universal lot, where Spielberg's Amblin offices were located. Set on a shady corner redolent of eucalyptus, Amblin was housed in low-slung adobe buildings. (Some in the industry had been known to call the complex “the Taco Bell stand.”) But Amblin couldn't hold all the DreamWorks employees, who at one point were working in nine separate
locations in Southern California, from Beverly Hills to the suburb of Glendale. By 1998, the company completed a large animation complex in Glendale, across the street from Disney's Imagineering facilities. Still, DreamWorkers were scattered in four different sites. This was hardly the studio that Spielberg had envisioned.

DreamWorks didn't exactly blast out of the box with big hits. Its first television comedy,
Champs,
was short-lived. The drama
High Incident
failed to catch fire and
Ink
flopped. Only
Spin City,
a comedy starring Michael J. Fox, performed well in the company's first five years.

Katzenberg had been confident that he could sweep into DreamWorks and take over live-action film from Walter Parkes and Laurie MacDonald, the married couple who had been running Spielberg's Amblin. But Katzenberg underestimated Spielberg's loyalty to the pair. It soon became clear that initially, at least, Katzenberg's primary roles would be in television and animation.

The fledgling company's first live-action film,
The Peacemaker,
was a thriller starring George Clooney and Nicole Kidman. Its director, Mimi Leder, was a Spielberg protégée who had directed several episodes of
E.R.,
the hit television show that Spielberg coproduced.
The Peacemaker
was Leder's debut in feature films. But the project—bogged down with production difficulties in Eastern Europe—turned out to be a rather routine thriller. It turned in a lackluster box-office performance.
Mouse Hunt,
a comedy starring Nathan Lane and a menacing rodent, did better but was hardly a breakaway hit.

DreamWorks finally hit pay dirt in 1997 with
Deep Impact,
the second effort from Mimi Leder. The tale of the earth imperiled by asteroids grossed $141 million, but DreamWorks had to split the pot with Paramount, which cofinanced the movie. DreamWorks' other summer film,
Small Soldiers,
disappointed. Its domestic gross of $53 million failed to cover even the estimated marketing cost of $60 million, not to mention the $60 million budget.

Spielberg's first directing effort under the DreamWorks banner seemed to suffer from some kind of curse. Spielberg wanted to make a seminal film about the Middle Passage, but
Amistad
became embroiled in an ugly battle with novelist Barbara Chase-Riboud. Just before the film opened, she sued claiming that material from one of her books,
Echo of Lions,
had been appropriated.

Screenwriter David Franzoni—who claimed he had never read her
book—had pitched a project based on the novel to Warner several years earlier. Many industry observers thought that DreamWorks handled the case badly, charging through attorney Bert Fields that Chase-Riboud was simply out to “grab money for herself.” It seemed a ham-fisted approach at best, particularly given the awkwardness of Franzoni's position.

The case was settled the day before the Oscar nominations were announced in 1998. Chase-Riboud proclaimed Spielberg's innocence in the matter but some in Hollywood felt that the damage had been done. Others argued that
Amistad
simply didn't work, either artistically or as entertainment. The film lost money, grossing only $44 million, and failed to garner the major Oscar nominations that the DreamWorks partners had hoped to receive. Spielberg returned his director's fee to the company.

Spielberg, who took the film's failure hard, was rumored to have blamed Katzenberg for failing to resolve the litigation before it damaged the film. Katzenberg said he was willing “to be the focal point of whatever second-guessing might go on.” But talk of a rift between Spielberg and Katzenberg continued to drift through the entertainment community. And Dream-Works seemed increasingly to be a conflicted committee of three men with varying agendas. Spielberg seemed primarily interested in making movies, not struggling with the difficulties of starting a big business. Geffen, many in the industry assumed, would have been happy to sell the company and call it a day. Only Katzenberg had everything to lose if DreamWorks didn't live up to its initial promise.

Finally, in the summer of 1998, DreamWorks got some good news in the form of Spielberg's summer film,
Saving Private Ryan
. The company had to share the project with Paramount, which owned the script. As part of the deal, DreamWorks had also agreed to share
Deep Impact,
another Paramount property that had intrigued Spielberg. The deal was that one of the films would be issued in the U.S. under the Paramount label and distributed internationally by DreamWorks; the other would bear the DreamWorks label domestically. The question of which studio would release which film was resolved by a high-level coin toss. Sumner Redstone, the cagey septuagenarian chairman of Paramount's parent company, Viacom, met with Spielberg at the Beverly Hills Hotel, the pink palace on Sunset Boulevard.

DreamWorks was desperate to get domestic handling of
Saving Private Ryan,
because Spielberg would direct the film himself. Not only were there commercial considerations, but there was the embarrassment of having
Spielberg directing under Paramount's banner when he had done only one film for DreamWorks—and an unsuccessful one, at that.

Spielberg had a premonition that tails would win. He hoped Redstone would toss the coin so he could make the call. But Redstone, perhaps sensing something about Spielberg's premonition, wouldn't allow it. He insisted that Spielberg toss the coin while he called. To Spielberg's relief, Redstone called heads. It was tails. DreamWorks ended up with
Private Ryan
under its banner in the U.S.

Saving Private Ryan
was a gritty World War II film that nearly earned an NC-17 rating. (Spielberg personally appealed to the Motion Picture Association's ratings board for an R, which would make
Private Ryan
commercially viable. He pledged that he would personally campaign to make the public aware of the film's realistic violence.) Though the studio defied conventional wisdom by opening a film with extremely serious subject matter in the summer popcorn season,
Saving Private Ryan
was a major hit. It brought DreamWorks the kind of commercial and critical success that Katzenberg had craved for years. The film grossed $216 million domestically, eclipsing Disney's costly
Armageddon
as the top box-office contender of 1998. Foreign box office added another $262.8 million. Now all DreamWorks had to do was sweep the Oscars.

 

IT WAS UP
to Katzenberg to prove that he could contribute to DreamWorks with his first animated production.
The Prince of Egypt,
the story of Moses, was an idea that had arisen in early conversations with Geffen and Spielberg about the new company. Spielberg had talked about doing a film with the majesty of
The Ten Commandments
and the three locked onto the idea of the Moses story.

If they had understood what a challenge the project would be, they might have made a different choice. Early on, it became apparent that typical animation gags would not fit into a story as significant as the Moses tale. The film would have to be entertaining yet serious enough to deal with subject matter like the slaying of the firstborn.

Katzenberg went into a frenzy of consultation with scholars and clergymen from the Jewish, Christian, and Muslim communities, ostensibly to gain their advice but also to win their support. He even visited the Vatican. The last thing DreamWorks needed was to have
Prince of Egypt
turn into a lightning rod for controversy.

Val Kilmer supplied the voice of Moses and Ralph Fiennes was Ramses. Sandra Bullock, Michelle Pfeiffer, Jeff Goldblum, Steve Martin, Martin Short, Danny Glover, and Patrick Stewart also starred. The songs were composed by Stephen Schwartz and the score was provided by Hans Zimmer—both Oscar winners.

The nature of the film also meant that DreamWorks could forget about lucrative tie-ins and merchandising opportunities. After extensive discussions with Burger King, the parties concluded that Moses-related meals were out—as were burning-bush nightlights.

Katzenberg toiled relentlessly to make
The Prince of Egypt
into a major creative and commercial contribution to DreamWorks. Perhaps more importantly, this was his chance to answer Disney. No studio had ever succeeded in touching Disney when it came to releasing a major family-oriented animated feature. Many had tried. Fox had released the expensively hyped
Anastasia,
which had grossed $58.4 million. The film had cost far more than that to make and market. Warner had failed entirely with films like
Cats Don't Dance
and
Quest for Camelot
.