From Hollywood to Media Empire

Hollywood, Universal City Plaza, in the office of the President of Focus Features, a subsidiary of Universal Pictures.

This year, the new Focus Features was just formed by the merger of Good Machine Productions, Universal Focus Features, and USA Films. James Schamus, one of the co-chairs of the newly formed company, was reviewing a film distribution request from Carpe Pictures.

"Two Americans in Tokyo find it hard to integrate due to cultural and language differences. They are drawn to each other due to loneliness and have an affair. Ultimately, they rediscover faith in the infinite possibilities of life."

"Is the director Sofia Coppola?"

"Yes, she is Francis Ford Coppola's daughter!"

An assistant responded, "Carpe Pictures is a new small company. They were involved in the development of My Big Fat Greek Wedding and Underworld."

"Lost in Translation is independently produced by Carpe Pictures, with a low budget!"

As one of the founders of Good Machine Productions prior to the merger, James Schamus knew from the cast and scenes that this film's production budget was unlikely to exceed $5 million.

"New director, new producer; let's see how the film turns out after shooting," Schamus wasn't in a rush. "Focus Features doesn't lack independent films seeking collaboration. The Coppola family may be influential, but business is business."

Moreover, Carpe Pictures didn't just send their plans to Focus Features. They also sent them to other independent film distribution companies like Sony Pictures Classics, Paramount Vantage, and Fox Searchlight Pictures.

Let's see who would be interested in distributing Lost in Translation?

As for Miramax and Lionsgate, Charles knew that they had too many films to distribute.

Miramax, for instance, released about thirty films a year. Many of them disappeared after a few days in theaters and they were now starting to produce big-budget films.

Lionsgate was similar. They released many films annually, but most of them were heading straight to the DVD market.

A film like Lost in Translation, an art film, didn't appeal much to Lionsgate, which preferred horror, thriller, violence, and political-religious B-films.

"Miramax is the titan of the indie film industry. If they distribute it, there's a big chance to sweep the awards," Evelyn was chatting with her son about Carpe Pictures.

"They love to hold back films. It's normal for them to shelve a movie for a few years before releasing it. Plus, they're involved in several big productions right now, so their focus will likely be there," Miramax was indeed strong, no doubt about it.

"You know, Lost in Translation is just a script right now. Distributors wouldn't sign a distribution contract so easily without any heavy-hitting filmmakers attached," Evelyn was worried her son might be left holding the bag.

Charles waved it off, chuckling, "No rush, let's shoot it first. Then we'll send copies to these independent distribution companies. Even if no distribution contract comes through, we'll just take it directly to the film festivals."

As for using Tom Hanks' connections, if he's not investing in the film, why would he care?

"Perhaps the Coppola family would provide some resources by then," Evelyn was equally open-minded. Hollywood connections always had their use.

"The Underworld crew has already departed for Budapest. Aren't you going?"

"Of course, I'm going. Constantin grabbed over $2 million in tax rebates from German film investors. They seem to be starting overseas presales now. The film hasn't even started shooting, but they expect to roll back $10 million first," Charles liked this kind of operation. It's what Hollywood loved the most.

Germany's policies were too enticing. Besides offering tax rebates for film investors, the best part was that films didn't have to be shot in Germany or involve German actors.

They just needed the film rights and future profits to belong to the German investors. However, the film needed to be generated by German investors and couldn't be directly bought as a finished product.

For Hollywood, this was simple! Sell the film rights to German investors first, then lease them back at a reduced price of about 10% for production and distribution, signing a future rights repurchase agreement.

What the German investors held would be an entrusted film production and distribution agreement in Hollywood, making everyone happy.

However, this policy loophole in Germany would be gradually patched up in the next two to three years. Securing film tax rebates was quite challenging; there was an annual quota. It depended on the film's fit with the criteria, shooting locations, and the cast.

In this regard, big studios had the advantage over independent films. Commercial blockbusters brought more to the table in terms of local tourism or cultural enhancement compared to art films.

"I'm the producer. Of course, I have to check things. Carpe Pictures' funds need my hard work."

Charles planned to head to Budapest, Hungary in a week. However, he had a few hundred thousand dollars on hand now that needed to be spent.

First, Carpe Pictures needed a new location as the current office space was inadequate. Then, they needed to acquire scripts or ideas.

Finally, hiring. Flying solo wasn't practical, and not having an assistant was just unacceptable.

*****

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