Capítulo 109: Chapter 109: Common Phenomenon
"Is it over there?" Murphy asked eagerly as he saw James Franco hang up the phone.
James Franco pocketed his phone. "Morris Entertainment is interested in the film and offered a buyout price of $4 million. It's higher than before..."
He shook his head.
Murphy tapped the steering wheel, reminding both his companions and himself, "Stay calm, there's still Lionsgate and Fox Searchlight."
Back at Stanton Studios, Murphy had a detailed discussion with the returning Bill Rossi. Morris Entertainment could basically be ruled out. This small distribution company wouldn't offer a higher price, and they weren't interested in non-exclusive rights distribution.
Early the next morning, Murphy rushed to Lionsgate. Milton Johnson and his team had a high assessment of the film's market potential.
Major Hollywood distribution companies had mature evaluation systems. While many factors influenced a film's success, they had the ability to gauge its market value.
The selling point of "Saw" was clear. Companies like Lionsgate, specialized in horror films, wouldn't overlook its potential.
But they wouldn't offer favorable conditions either.
"Director Stanton..." Milton Johnson sat behind his desk, looking at Murphy. "Lionsgate has signed distribution contracts with other companies before. This is not unprecedented."
He tapped the desk lightly. "Thirty percent distribution fee is our bottom line."
Murphy was about to speak when Milton Johnson raised his hand, indicating he hadn't finished. "According to company policy, Lionsgate must also have fifty percent ownership of the film."
This exceeded Murphy's bottom line and was even stricter than Miramax's conditions.
Bill Rossi couldn't help but interject, "Mr. Johnson, you've seen the film. You can tell it's a standout in the horror genre..."
"Bill, coming from CAA, you're well-informed," Milton Johnson leaned back, arms crossed, with a hint of sarcasm, "Tell me, does a movie with excellent content always succeed? Is there no risk in Lionsgate distributing this film? Can you guarantee profit?"
Even with thick skin, Bill Rossi wouldn't dare make such claims.
Milton Johnson continued, "Lionsgate takes on the high risk of marketing. Naturally, we expect a high percentage. How else can I convince others in the company?"
Murphy shook his head at Bill Rossi, indicating there was no need to negotiate.
He didn't even get a chance to speak. Milton Johnson didn't give them the opportunity to bargain. This negotiation was purely about exploitation. Milton Johnson was even more forceful than Harvey Weinstein. There was no point in wasting words.
With such conditions, there was no possibility of reaching an agreement. Murphy and Bill Rossi quickly left Lionsgate's headquarters in Santa Monica.
In the office, Milton Johnson made a phone call, "Jamie, activate the backup plan."
Murphy and Bill Rossi got into the same car. Murphy, in the passenger seat, asked the more experienced Bill Rossi, "Will they lower their conditions?"
Bill Rossi shook his head. "Unless you're willing to sell the rights."
Murphy said decisively, "Lionsgate is temporarily listed as the last choice."
Upon hearing Milton Johnson's conditions, he had no interest in negotiating.
Although it was normal for downstream small production companies to be exploited by upstream distribution companies, it still felt uncomfortable to be in the weaker negotiating position.
"Thirty percent distribution fee." Murphy rolled down the car window, letting in some fresh air to dispel the stuffiness inside the car. "Isn't that the distribution contract a major distribution company would offer for their own productions?"
Typically, Hollywood distribution fees ranged from five to twenty percent.
"It's simple. Your Stanton Studios..." Bill Rossi brought two fingers together, making a small gesture, "And other companies won't offer much better conditions. Exploitation by upstream companies is a common phenomenon in this industry. Even if someone offers better conditions, they still have room for adjustment. And, other companies offering a thirty percent distribution fee often include marketing expenses, which Lionsgate doesn't."
Murphy fastened his seatbelt. The idea of distributing his own films had never been so strong.
Establishing a distribution system couldn't be achieved in a short time, and it required substantial funds.
How could he break this deadlock? Murphy couldn't think of a good solution for a moment. Dealing with the almost monopolistic advantage of distribution companies like the Big Six in Hollywood wasn't something that could be changed in the short term.
He suddenly remembered rumors he had seen online. "Have you heard that the Big Six often manipulate data on some films through distribution fees?"
"That's right, it's a common phenomenon."
They hadn't discussed this topic before, but now that they had, Bill Rossi continued, "Their methods are very sophisticated. Many times, they know there are problems but can't do anything about it."
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