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Hollywood Shut-Downs: The Industry Gets Cold Feet

Three major studios pull the plugs on three major productions – a sign of these nervous times

It’s hard not to look around Hollywood these days and see an epidemic of cold feet.

Some might call it an excess of caution. Others will call it fiscal prudence. I’m just going to call it what it is: the willies.

Executives are nervous. Calculating the projected profit on movies has become a crapshoot, just like calculating the likely income off of a film library.

This is now a process best served with a Ouija board rather than a spreadsheet.

In the past couple of months, no fewer than three major studios have called off three movies ahead of production that in other times would have been slam dunk ‘go’ decisions.  

Just last week it was “Cartel” at Universal, which was on the cusp of principal photography in Mexico. What was the reason? First came rumors of death threats, but it turned out that no, that wasn’t it at all.

It’s just that spending had already started to creep over budget and the script didn’t inspire enough confidence.

But it’s a sign of the times.

”People are so focused on: 'Can they actually make the budget?'” said one individual close to “Cartel.” “If the budget is set and you see it starting to slip away, and the script didn’t get to a place where you want it … “ executives would rather punt.

The movie wasn’t all that expensive at that — $42.5 million, according to our information. But after a few disastrously expensive adult thrillers, Universal is under strict orders not to overspend.

Said this individual: “They do not want to have movies over budget.” 

With no major star in the lede, and this looking like another one of those risky thrillers, studio chairman Adam Fogelson pulled the plug. 

Meanwhile, Sony passed on a pricey fourth installment of “Spider-Man” a couple of months ago, a  tough call by studio co-chairman Amy Pascal.

The word on that project was that the director, Sam Raimi, had been making radical changes on the movie in the weeks before production was to begin. Already that was ratcheting up spending on a very expensive project.

And one insider tells me that the projected revenue on DVDs could not be calculated high enough to justify the price of the movie.

The official word is that Raimi and Pascal were not happy with the script. And that, too, may be true.

Meanwhile, Sony is rebooting the whole franchise from zero, which will make it all cost-effective again.

Finally there’s the most surprising decision over at Disney, where the new chief Rich Ross cancelled “Wild Hogs II” despite the fact that the first movie made a boatload of profit, and that all the players – John Travolta, Tim Allen, Martin Lawrence et al – all agreed to keep their salaries in check.

The movie took in $253 million worldwide, according to boxofficemojo. And one Disney insider says it made the studio $100 million — in PROFIT.

In this case, the decision may have been strategic, and personal. Ross was known not to have been a fan of the first movie. And he has been placing his bets uniquely on major franchises, provided by Pixar, Marvel, DreamWorks and Jerry Bruckheimer.

His philosophy is to choose only projects that can be run as revenue drivers throughout the Disney system – consumer products, television, international and mobile and web.

There is little room in that universe for a small movie that has no toys to sell to WalMart.

“It’s a symptom more than a disease,” said one veteran executive who declined to speak on the record. “Money is tight. Risks are greater. Movies are expensive. Choices have to be made.”

But, he noted, there are risks to pulling back. “When you pull your player out of game, it’s like soccer – you don’t get to go back in. If you remove ‘Wild Hogs 2’ and don’t have anything to put in its place … “ then clearly the studio may end up needing product for its pipeline.

But mainly, the movie shutdowns seem to be a part of the high anxiety that is plaguing the industry at the moment.

Said one producer who is fearful about seeing his projects shut down: “It’s a very stressful time for everyone in business. You jump through all these hoops, and at 6 p.m. on a Friday you realize this won’t go.”