Shmuger, Linde stay with Universal
Duo re-ups contract for another four years
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When tapped in early 2006 to replace DreamWorks-bound Stacey Snider, Shmuger became chairman and Linde co-chairman. In the re-up, structured by Universal Studios president-chief operating officer Ron Meyer, Linde lands on equal footing with Shmuger.
During the past three years, Shmuger and Linde have cemented deals with key lot-based producers and overhauled the international distribution system. Universal ended 2008 with a global gross of $2.83 billion.
As they start their second term, Universal faces the same problems as all other studios owned by congloms with declining stock prices. U and other studios will ramp production back up for 2010 and 2011, mindful of shrinking DVD revenues and a rocky economic outlook.
"We don’t foresee any further shedding of assets, but we don’t see expansion for anybody, either," Shmuger said. "The challenges are real, there are pressures at the retail level, the DVD business is shrinking. The tough part is how one keeps those in check in light of flat or shrinking revenues."
Meyer said Shmuger and Linde deserve credit for meshing quickly after Meyer put them together, preventing a disruption that could have occurred after Snider left.
"Marc and David assumed the leadership instantly," Meyer told Daily Variety. "They had a feeling for the people, the projects and the business."
Despite the economic downturn that caused NBC Universal to mandate a 3% cut in personnel late last month, Shmuger and Linde said Universal’s global infrastructure is stronger than when Meyer first paired them. Shmuger had been the studio’s marketing chief, and Linde ran Focus Features with James Schamus.
"The best way to look at how far we’ve come is to remember where the company was when we came in," Shmuger said. "The deal with Working Title was expiring, there was uncertainty and press speculation about the Imagine deal, the studio had just lost DreamWorks to Paramount, we were no longer part of UIP, our slate financing was expiring."
They quickly made new long-term pacts with Imagine’s Brian Grazer and Ron Howard and Working Title’s Tim Bevan and Eric Fellner, and they subsequently reupped "Wanted" producer Marc Platt and Scott Stuber.
They’ve added a deal with Hasbro to turn its branded toy and board-game properties like Stretch Armstrong into features, another with Gore Verbinski to produce and direct films as well as to develop videogames. They made a producing deal with "Bourne Identity" rights holder Ludlum Entertainment that keeps the "Bourne" franchise rolling and gives U first look at other novels by the late Robert Ludlum.
Shmuger and Linde also tapped Fox Animation head Chris Meledandri to start an animation and family-film production company. The studio has set a July 9, 2010, release date for Illumination Entertainment’s first animated film, "Despicable Me." The 3-D CG pic features the voices of Steve Carell, Jason Segel and Julie Andrews.
Universal has addressed its equity problem via a long-term financing deal with Relativity Media to put equity in 10-15 films per year through 2015.
After Shmuger and Linde launched Universal Pictures Intl. to replace UIP in January 2007, the toppers hatched an international production division to make locally-produced films in Russia, China, Brazil, Germany and Mexico; they recently merged that division with Focus Features to form Focus Features Intl.
Finally, Snider and Steven Spielberg have returned and will distribute their DreamWorks films through the U pipeline beginning next year.
"We had basic goals, to get the Universal slate up and running in a consistent and global manner, and we needed to get into the family business," Linde said.
The Shmuger-Linde regime has faced adversity along the way.
Hard feelings resulted when Brad Pitt pulled out of "State of Play" right before production began in late 2007, but Russell Crowe was set to replace Pitt in time to keep most of the cast in place. Universal got back in the Pitt business last year when the studio was chosen to partner with the Weinstein Co. on the Quentin Tarantino-directed "Inglourious Basterds."
After U signed Guillermo del Toro to a rich overall deal, Shmuger and Linde were disappointed to see the "Hellboy II" helmer sign for two installments of "The Hobbit" for MGM and New Line that promised to keep him in New Zealand until his U pact expires. But the studio and director worked it out: Del Toro recommitted to the studio and will direct monster films based on Universal franchises "Frankenstein" and "Dr. Jekyll and Mr. Hyde."
The hard times that hit parent company GE and the entertainment business in general have curbed Shmuger and Linde’s appetite for expansion. Universal sold off its Focus-based genre division Rogue to Relativity Media, pocketing a reported $150 million late last year for the Rogue library and more than 30 development projects. Though U will get a distribution fee for those films, the deal resulted in the exit of Rogue prexy Andrew Rona, who spurned a deal to produce U films and left to run Silver Pictures for Joel Silver.
