Steven Spielberg is seeking a backer outside Hollywood.

BROOKS BARNES ESSAY

In June, DreamWorks, the boutique movie studio that Steven Spielberg cofounded in 1994, let it be known that it had found a way to exit its unhappy threeyear marriage with Paramount Pictures. Reliance ADA Group, a Mumbai conglomerate, was nearing a deal to give the dream workers $550 million to form a new movie company.
That Mr. Spielberg and his business partner David Geffen had found an investor wasn’t surprising. Mr. Spielberg is a superstar. DreamWorks had made it clear for months that they hated being part of Paramount and were going elsewhere as soon as it was contractually allowed.
But there was still an element of shock: Hollywood could not come up with a rich enough deal for Mr. Spielberg, the most bankable director in the business and a “national treasure”- His last movie alone, “Indiana Jones and the Kingdom of the Crystal Skull,” has sold $743 million in tickets and is still playing in theaters around the world.
There wasn’t anybody on Wall Street willing to write a blank check for the guy with “Jaws” and “Jurassic Park” on his resume?
The pending deal with Reliance underscores some realities about Mr. Spielberg - mainly that he has become so expensive that few public companies can afford him. Mr. Spielberg’s standard deal is 20 percent of a movie’s gross from the first ticket sold .
And there’s another whisper coming from Hollywood’s highest echelons : How long before the A-list director, at 61, is a little, well, Jurassic?
Such talk is rooted in justifications for losing Mr. Spielberg to Reliance, his allies say, noting his huge list of projects on the horizon. Among them are potential blockbusters like “Transformers: Revenge of the Fallen,” which he will produce. He’s also pursuing more cerebral projects like an Abraham Lincoln film with a script written by the “Angels in America” playwright Tony Kushner.
Even so, Mr. Spielberg’s representatives had been talking with potential backers for months, said three people involved who requested anonymity for fear of angering the powerful director. The Spielbergians had casual chats with companies including Sony and the News Corporation. Hollywood’s seeming inability to close a deal with Mr. Spielberg highlights the shift toward a more corporate movie business. Just a few years ago, bragging rights often drove business decisions. Steven Spielberg is available- Back up the money truck.
But now that the big studios are all firmly embedded in big corporations, profit margins are the obsession. “Big names don’t carry the same weight they used to,” said Harold L. Vogel, an independent media analyst.
DVDs also play a part . After years of blistering growth, DVD sales in the United States fell 3.2 percent last year to $15.9 billion, according to Adams Media Research, the first annual drop in the medium’s history. Any decline is cause for great concern, because DVD sales can account for as much as 70 percent of revenue for a new film.
When DVDs were soaring, studios had an incentive to own projects outright. Recently, they’ve been going the other way, trying to share ownership to protect themselves. Indeed, the DVD situation, combined with the arrival of widespread Internet streaming, has studios panicked . Studios are also increasingly focused on franchise films that sell overseas. The DreamWorks team believes in delivering a mix of prestige films and blockbusters.
Mr. Spielberg, who has directed more than 50 films, wants to control his own destiny; at this point in his career, say friends, his accomplishments have earned him the right to have 100 percent control over his movies. At the moment, overseas investors are the most likely to allow Mr. Spielberg to write his own ticket, say studio executives.
Hollywood will still have a chance to grab a piece of the storied director. After negotiations with Reliance come to a close - if they come to a close - Mr. Geffen and Mr. Spielberg will start looking for a distribution deal with one of the big studios .
Will Mr. Geffen and Mr. Spielberg see a bidding war? Probably, but it depends on what kind of terms they want.