I was curious when I first heard that billionaire Megan Ellison, Larry Ellison’s 26-year-old daughter, had landed in Hollywood and was making movies like "The Master" with Paul Thomas Anderson and "Killing Them Softly" with Brad Pitt. Her aversion to the media made her only more intriguing.
But it may be that well-meaning financiers like Ellison will ruin what is left of the independent movie business.
Ellison is gutsy and rich, as TheWrap pointed out when it put her on our list of “10 Producers Who Will Change Hollywood 2012.”
Also read: 10 Producers Who Will Change Hollywood in 2012 [5]
Her Annapurna Productions wrote a check for more than $35 million to finance “The Master,” Anderson’s sweeping, ambitious 70MM drama, inspired by the origins of Scientology.
And she shelled out $45 million to fully finance Kathryn Bigelow’s “Zero Dark Thirty” – a film whose budget started at the substantial $39 million and kept climbing into the stratosphere, an executive close to the producer said.
(Other sources close to the production put those figures at $40 million and $60 million, respectively.)
Still that’s $80 million out of pocket on production this year alone.
As Todd Cunningham pointed out in his story in TheWrap [6] this week, “The Master” is winding down after five weeks in theaters and has taken in $14 million, not a bad outcome for the kind of movie it is, but a certain financial loss to the producer.
“The Master” should have been made for $10 million, or $12 million, much more in line with what movies like "Black Swan" (with a budget of $13 million) or “The Hurt Locker” ($15 million) cost.
Also read: 'The Master' May Win Awards, But It's a Box Office Loser So Far [6]
For all its Oscar glory, “The Hurt Locker” grossed $49 million worldwide, and just $17 million domestically. “Zero Dark Thirty” will have to make three times that to recoup its production and marketing costs. It, too, should probably have been made for under $20 million. Then it would have a fighting chance at a profit.
Spending so much on these arthouse films almost guarantees they will be money losers, and that is bad for the movie business altogether.
An executive familiar with Ellison's thinking pointed out that she launched a foreign sales company with Mark Butan, Panorama, and raised more than $30 million in foreign presales for "Zero Dark Thirty."
Losing money may not be a problem for a young woman who inherited $2 billion on her 25th birthday. But Ellison’s largesse pumps up prices for indie filmmakers across the board and creates a track record of financial failure that is likely to deter other investors.
Also read: The Cool Kids in Cannes: A ‘Lawless’ Afterparty With Megan Ellison and Friends [7]
Certainly no established movie studio is going to choose to make movies with these filmmakers at those prices, which also is not a healthy outcome for quality film.
You may argue -- as some of our commenters have -- that Megan Ellison can choose to spend her vast wealth as she chooses. And that’s certainly true. If she wants to be a modern-day Medici, underwriting the cinematic artists of our time, we may all be the richer culturally for films we would not otherwise have had from the likes of Anderson.
But the overall effect on the landscape for quality movies is not a good one. Every big-ticket failure kills another great movie in its infancy.
I met Ellison at a party in Cannes in May. She was smart, thoughtful and explained that her avoidance of the press was nothing personal, she just didn’t want to be in the limelight. But Megan, if you continue to finance movies at this level, you will get plenty of attention.
Through a spokeswoman, Ellison chose not to comment for this article. The producer was on the set of her next movie, Bennett Miller’s “Foxcatcher.” I bet it’ll be good.
And too expensive.