Saturday, July 28, 2007

Times Online

Spielberg’s war of the words Geffen, Jeffrey Katzenberg, Steven Spielberg

WHAT do you give the man who has everything? Respect, if you know what’s good for you. After a series of snubs to his friends, Steven Spielberg is said to be considering ending his relationship with Paramount, the Hollywood studio.

Spielberg, whose hits include Jaws, ET, Jurassic Park and Schindler’s List, sold his DreamWorks studio to Paramount in December 2005 for $1.6 billion (€1.2 billion). The deal handed Paramount last year’s Oscar-nominated films Dreamgirls and Letters from Iwo Jima and two of this year’s biggest hits, Transformers and Shrek 3.

The acquisition was a coup for Brad Grey, who had been hired 11 months earlier to turn around Paramount. As well as Spielberg, the DreamWorks deal also gave Paramount access to two of Hollywood’s other power players, David Geffen and Jeffrey Katzenberg and DreamWorks’ library of movies. For the media conglomerate Viacom, Paramount’s owner, the price tag now looks like a bargain.

But for DreamWorks the deal always came with one big potential problem: Sumner Redstone, the octogenarian founder of the Viacom empire, who has a history of public fallouts with employees and family.

A few months after the DreamWorks deal, Redstone clashed with the actor-turned-producer Tom Cruise, who had made blockbusters including Mission Impossible and Top Gun during his 14-year relationship with the studio. The Viacom chairman terminated its contract with Cruise’s production company, blaming the star’s behaviour on a publicity tour for Mission Impossible III, including a lively performance on the Oprah Winfrey show, and his sounding off against antidepressants. “His recent conduct has not been acceptable to Paramount,” said Redstone.

Earlier this month Redstone clashed with his daughter Shari Redstone. Seen as a talented executive in her own right, she is also a big shareholder in the family firm, National Amusements, and was once her father’s heir apparent.

But in a withering letter to Forbes magazine, he wrote: “It must be remembered that I gave to my children their stock, and it is I, with little or no contribution on their part, who built these great media companies.”

Peter Bart, editor of Variety, says Spielberg could walk within 15 months, taking the DreamWorks name, but not its back catalogue or current projects, with him.

Last year Spielberg, who rarely makes public criticisms, told The New York Times that he “took exception” to Paramount “referring to every DreamWorks picture as a Paramount picture”.

His comments came after Grey addressed a premiere for Dreamgirls and left the impression that the film was a Paramount release. The film was put into production at DreamWorks and was produced by Geffen.

He was also unhappy with the way Redstone fired and publicly trashed Cruise.

Grey has since been on a charm offensive, personally delivering a $1m cheque from Paramount made out to the director’s Shoah Foundation charity.

Last week both sides moved to patch over any dispute. Paramount did not return calls seeking comment, but Geffen told Variety that he was happy with the Paramount relationship. But many in Hollywood are betting that Spielberg will move on.