Tough economic times are forcing studios to not only cut back on the number of movies they’re making but also eliminate many of the lucrative first-dollar gross deals they used to cut with big stars, guaranteeing the actors part of the film’s box-office revenues from the first dollar earned.
It began with the risky deal Jim Carrey signed for Yes Man, The WSJ notes:
He forfeited first-dollar gross and took no money upfront in exchange for a sizable back-end deal, which included a 33% ownership stake in the film.
Had the film bombed, Mr. Carrey would have received a fraction of his usual fee. The film was a success, but didn’t perform as well as the studio had expected. Still, Mr. Carrey made about $35 million off the deal — roughly $5 million more than he would have made had he not forfeited his fee, according to Mr. Gold, who helped craft the agreement with talent agency Creative Artists Agency and the studio.
“It was a big moment for the business,” says Mr. Gold, who noted that other similar deals have followed.
Indeed, The WSJ offers four examples of movies in which big-name stars aren’t making big bucks up front:
- Paramount and DreamWorks’ Dinner for Schmucks: Actor Steve Carell and director Jay Roach will receive upfront fees of $10 million-$15 million each. “[B]y deferring their gross payments until after the movie has made its money back, Paramount shaved about $5 million off the production cost of the film,” the WSJ reports.
- Paramount’s Morning Glory: star Harrison Ford will only get a portion of the gross after the studio has recouped its expenses.
- Universal’s Robin Hood film, directed by Ridley Scott and starring Russell Crowe: none of the film’s talent will get first-dollar gross deals, keeping the budget at $130 million as opposed to the $175 million it could have grown to.
- Nicolas Cage won’t get any of The Sorcerer’s Apprentice’s revenues until Disney has recouped some costs.
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