Disney-ABC Television Group lays off hundreds

The Disney-ABC Television Group today laid off several hundred people, citing the weakening economy. Group President Anne Sweeney sent an e-mail to the approximately 7,000 television group employees, saying that after months of trying to adjust the business to the worsening economic climate, "we're now faced with the harsh reality of having to eliminate jobs in some areas."

"This was not an easy decision, nor one made lightly," Sweeney wrote. "The people affected today are our friends and colleagues, and we are doing all we can for them and their families."

The announcement comes a day after ESPN Chief Executive George Bodenheimer said he would cut 200 jobs within the year, mostly from unfilled positions. Sports broadcasters have been particularly vulnerable to decisions by struggling automakers to cut spending on advertising. It also comes a week after ABC's move to consolidate its network and television program production divisions into a single entity.

More layoffs are anticipated in the coming months, as ABC Entertainment Group President Stephen McPherson evaluates staffing at the newly consolidated studio and network operation.

"I realize this is an extremely difficult day for everyone in our group," Sweeney wrote. "But despite the challenges before us, I remain confident and optimistic about our future, because you really are the best in the business."

-- Dawn C. Chmielewski

Photo: ABC headquarters in Burbank. Credit: RMA Photography Inc.

Actors, studios to return to negotiating table

To virtually no one's surprise, the Screen Actors Guild and the major studios announced late Wednesday that they will return to the negotiating table Tuesday to try to forge a new contract for actors.

The move comes only two days after SAG's board hired a new negotiator, John McGuire, and a new interim executive director, David White, following the ouster of Doug Allen. At the same time, the board formed a new "task force" to replace the previous negotating committee.

Moderates who orchestrated the shake-up are expected to move quickly to finalize a new contract, which will be modeled on deals secured over the past year by three other talent unions. Their challenge will be to obtain improvements over the studios' previous "final offer" that will be acceptable to members and demonstrate that the leadership didn't capitulate under pressure.

SAG members have been working without a contract since June 30.

-- Richard Verrier

Fox agrees to step in on next 'Narnia' movie

Twentieth Century Fox has agreed to co-finance the third movie in the “Chronicles of Narnia” series, pending approval of the final script and shooting budget. If all goes as planned, Fox and Walden Media, which controls the movie rights to C.S. Lewis’ classic children's books, hope to begin production on "The Voyage of the Dawn Treader" by late summer so it will be ready for holiday 2010 release.

First, however, Fox and Walden have to hire a screenwriter to do another pass on the script that was last rewritten by Richard LaGravenese, whose credits include "Freedom Writers" and "The Horse Whisperer." The movie companies are looking to make the film for about $140 million. Michael Apted, who made "Amazing Grace" and the 1999 Bond flick "The World Is Not Enough," is on board to direct.

Fox is taking a financial gamble that Disney was unwilling to wage despite helping bankroll the first two films in the "Narnia" family franchise. Walden, owned by entrepreneur Phil Anschutz, was forced to seek a new financial partner on “Dawn Treader” after Disney balked at the cost and opted out.

Fox was the most likely partner because the studio already markets and distributes Walden movies under its Fox Walden label.

Over the last few weeks, Walden chief David Weil and “Narnia” producer Mark Johnson have held a series of meetings with top Fox executives, including movie chiefs Tom Rothman and Jim Gianopulos, to discuss script revisions and the movie's cost.

While the targeted budget of “Dawn Treader” is much lower than that of the last Narnia movie, “Prince Caspian,” which cost $225 million to produce, it's still a big gamble. Released by Disney last year, the sequel was much less popular than the first "Narnia" movie, “The Lion, the Witch and the Wardrobe.” The sequel grossed $419 million worldwide compared with its 2005 predecessor, which generated $745 million in ticket sales.

Disney and Walden hope that DVD sales of "Prince Caspian" will help pull the movie out of the red.

-- Claudia Eller

Photo: "The Chronicles of Narnia: Prince Caspian" is courtesy of Walt Disney Studios

Spielberg closes in on debt financing

Steven Spielberg, who amid the credit crunch has been having a tough time raising money to finance his new DreamWorks studio, appears to be getting there slowly but surely.

The filmmaker's lead bank, JPMorgan Chase, has received a commitment for about $150 million --nearly half of the $325-million loan that Spielberg hopes to have in place by late March. Only then will Spielberg's financial partner, India's Reliance Entertainment, begin forking over its matching equity portion so the director and his top movie executive, Stacey Snider, can start making movies. 

A couple of weeks ago, Spielberg and Reliance paid Paramount Pictures about $27 million to buy 17 projects that DreamWorks had been developing at their former studio home and desperately need to get cameras rolling for their venture. This week, Spielberg began directing the big-budget motion-capture 3-D movie "The Adventures of Tintin: Secret of the Unicorn," starring Jamie Bell and Daniel Craig, for Paramount and Sony Pictures.

A DreamWorks spokesman said, "This is a vote of confidence in the new company, so we're feeling pretty good about it."

-- Claudia Eller

Photos: Spielberg (Hector Mata / AFP/Getty Images) and Snider (Vince Bucci / Getty Images)

Viacom and partners brand new movie channel

Three movie studios -- Viacom Inc.'s Paramount Pictures, Lionsgate and Metro-Goldwyn-Mayer -- said today that they were saddling up for a fourth-quarter ride of their planned new movie channel. They also said their proposed channel's moniker is Epix.

It's pronounced "EH-pix," not "EE-pix" a la EBay or Eharmony. Epix is a play on the word "epic" that much of Hollywood aspires to. Insert lion's roar here.

The venture came together about 10 months ago as the studios' lucrative and longtime pay-TV deals with CBS Corp.'s Showtime Networks were winding down. After months of testy negotiations, the two sides failed to come up with a new distribution pact. 

That's partly because the three amigo studios knew they were sitting on a treasure trove of films, including "Indiana Jones" and the "The Curious Case of Benjamin Button." In April, they decreed that they didn't need no stinkin' Showtime and could launch a "next-generation" move channel of their own.

But the venture needs to rustle up some distribution partners. That part of their mission has been slow going, which conjures up less memorable lines from Warner Bros.' 1948 classic "The Treasure of the Sierra Madre." 

"Hey, if there was gold in them mountains, how long would it have been there? Millions and millions of years, wouldn't it? What's our hurry? A couple of days, more or less, ain't gonna make a difference."

-- Meg James

SAG's White seeks to heal wounds

UPDATE: So much for unity. SAG president Alan Rosenberg has just offered a reminder of how that won't happy anytime soon. In his own message to members, Rosenberg blasted the board's decision to fire executive director Doug Allen on Monday. A staunch backer of Allen's, Rosenberg accused the board of using an "undemocratic provision" in the SAG's constitution to oust Allen and not giving him a chance to "face his accusers ... Many of us believe that Doug Allen was fired simply because he was too good, too strong, and too much a unionist," Rosenberg said.

David White, interim executive director of Screen Actor Guild, wasted no time calling on members to end the sparring that has hobbled the union.

SAG's board fired former executive director Doug Allen on Monday and replaced him with White, a former general counsel to the union. In his first communication, White said in an e-mail message to members that his top priority was to unify the guild.

"As we confront these efforts together, my overarching goal is this: to help restore your confidence that this is a union where strong and wise decisions are made despite political differences," White wrote. "It is time to turn the page on the most destructive aspects of the guild's internal politics."

Whether Allen's supporters, including SAG President Alan Rosenberg, are ready to make peace with the new top administrator remains to be seen. Many of Allen's backers in the "Membership First" camp are deeply upset over his ouster and suspicious of White.

But White has the backing of moderates who now control the board, as does John McGuire, who has been charged with reopening contract talks with the studios that have stalled for months. McGuire has already had informal discussions with studio representatives to lay the groundwork for negotiations that could begin by early next week, people familiar with the matter said.  SAG members have been without a contract since June 30.

-- Richard Verrier

Universal renews contracts for movie chiefs Marc Shmuger, David Linde

There's now executive parity at Universal Pictures. As part of a four-year contract extension, the studio's movie bosses, Marc Shmuger and David Linde, will now share the chairman title.

Neither adds new responsibilities in his executive roles. But the announcement, which accompanied a "town hall" meeting of employees on the Universal lot this morning, signals a vote of confidence and management stability for the NBC Universal-owned movie studio. Shmuger's and Linde's contract renewal comes on the heels of company-wide cutbacks at the entertainment giant, which like other businesses is grappling with the economic downturn.

In March 2006, when they were paired to succeed studio chief Stacey Snider (who left to join DreamWorks), Shmuger was crowned chairman and Linde co-chairman. Over the last three years, the two have helped steady Universal after it was rattled by the departure of the highly-regarded Snider.

When they took over, Shmuger and Linde made it priority to keep the studio's key production companies, Imagine Entertainment and Working Title, in the fold by clinching new multi-year deals with each.

According to Universal, the two have overseen the "two most profitable years" in the studio's history when it logged a worldwide box office record in 2007 thanks to such hits as the action picture "The Bourne Ultimatum" and comedy "Knocked Up." The studio then surpassed that milestone last year with global ticket sales of $2.8 billion, fueled by releases "Mamma Mia!" and "The Incredible Hulk."

And, like all studio chiefs, they've had to endure their share of box office misses such as "The Kingdom," "Flash of Genius" and the costly comedy sequel "Evan Almighty."

-- Claudia Eller

Photo: David Linde , left, and Marc Shmuger. Credit: Alex Berliner / Berliner Studios/BEI Images

Lionsgate's Tom Ortenberg jumps to Weinstein Co.

Lionsgate distribution and marketing vet Tom Ortenberg has left the independent studio after more than 12 years and is joining the Weinstein Co. in the newly created post of president of theatrical films. He will oversee distribution, marketing, publicity and acquisitions domestically for TWC and its genre label, Dimension Films.

Ortenberg, who begins his new job Monday and will remain based in Los Angeles, will have his work cut out for him at TWC, which has struggled to produce hits since its formation by Bob and Harvey Weinstein following the brothers' acrimonious corporate divorce from Walt Disney Co.

TWC, which previously had a distribution deal with MGM, is now releasing its own films. Ortenberg said he is looking forward to working for the demanding Weinsteins, whom he's known for the last decade since Lionsgate and the Weinsteins' former movie company, Miramax Films, collaborated on such releases as "Fahrenheit 9/11," "Sicko" and "Dogma."

Ortenberg says he's joining TWC at an "opportune time," when the company is poised to release what he believes is a promising slate of movies that includes director Quentin Tarantino's World War II drama "Inglourious Basterds," starring Brad Pitt and Mike Myers; the horror sequel "Halloween 2"; Rob Marshall's screen adaptation of the Broadway musical "Nine," featuring Daniel Day Lewis, Penelope Cruz, Nicole Kidman and Kate Hudson; and "Youth In Revolt," a coming-of-age story starring Michael Cera (who played the boyfriend in "Juno").

TWC this weekend is expanding its Oscar-nominated film "The Reader" onto more than 1,000 screens.

Ortenberg, who was the first executive to work in Lionsgate's Santa Monica office when it opened in 1996, had a contract with the studio that ran until this spring. After Lionsgate acquired "Juno" financier Mandate Pictures in September 2007 and brought in founder Joe Drake as co-COO and president of the motion picture group, many in Hollywood felt it was only a matter of time before Ortenberg would be gone. Ortenberg says his years at Lionsgate have been "wonderful" and that "it was time for a new challenge."

Drake credited Ortenberg with being a "huge asset" in helping build the company and the parting of ways was "amicable." As Ortenberg's deal was expiring, Drake says, "ultimately, we both decided it was best to go our separate ways." Ortenberg is not expected to be replaced, with his duties to be picked up by Lionsgate's two co-presidents of marketing, Sarah Greenberg and Tim Palen, and distribution head Steve Rothenberg.

-- Claudia Eller

Photo of Tom Ortenberg by Genaro Molina / Los Angeles Times

SAG board members move to oust chief negotiator

The Screen Actors Guild board today moved to oust the union's executive director, Doug Allen, citing a crisis in leadership that has paralyzed Hollywood's largest actors union.

A majority of directors said in a statement that they had delivered a "written assent" document to SAG headquarters that authorized that Allen be immediately replaced as national executive director by former SAG General Counsel David White, who will serve as interim executive director. Allen has been on the job for two years.

For now, Allen's job will be split in two. As part of the shake-up, John T. McGuire will take over Allen's role as the union's chief negotiator on all contracts. In addition, the union's negotiating committee will be replaced by a "task force" appointed by the board, which will "work to secure a TV/theatrical contract that can be sent to members with a positive recommendation."

"These much needed changes will allow SAG to chart a new course," the group said.

The move, which was widely expected, comes two weeks after the board majority attempted to fire Allen but was filibustered by his supporters during a 28-hour meeting. The group represents a coalition of so-called moderates who have accused Allen and SAG President Alan Rosenberg of mishandling negotiations and dividing the 120,000-member union. Actors have been working without a contract since June 30, 2008.

The board members voted by means of "written assent," a provision in SAG's constitution that allows a majority of directors to take action by putting their votes in writing. "The unrelenting obstruction by a minority of board members has left us no alternative,'' the group said in explaining its action.

SAG had no immediate comment.

-- Richard Verrier

Photo: Ken Hively / Los Angeles Times

Droopy feathers among the peacock's TV stations

General Electric Co. released its fourth-quarter earnings Friday, and the news was grim from NBC's local TV stations, historically one of the most reliable generators of cash flow for NBC Universal.

Revenue from the stations tumbled 25% compared with the fourth quarter of 2007, and operating profit dropped a staggering 55%.  GE's overall income plunged 44% to $3.72 billion as the conglomerate's industrial and finance businesses were hit hard by the recession.

All local media outlets, including newspapers, TV and radio stations, have fallen on hard times in the last year as their best advertisers -- including car dealerships and retailers -- have struggled to maintain customers and sales. 

The financial picture wasn't as bleak for all of NBC Universal. For the period that ended Dec. 31, the media company generated $4.43 billion in revenue, down 3% from the fourth quarter of 2007. Operating profit came in at $865 million, down 6%.

Saving grace: cable television.

The company benefited by strong results from its cable channels including MSNBC, which saw its revenue up 37% for the election-driven quarter. Overall, revenue from the cable channels, including USA Network and Bravo, was up 11% and profit soared 22% for the quarter.

"We had continued strong performance in cable, but that was more than offset by the pressure that we are seeing in local markets," GE Chief Financial Officer Keith Sherin told analysts in a conference call.

It was a mixed bag for Universal Pictures and the theme parks. Operating profit was down 7% for the division, partly because of higher marketing costs resulting from the release of more films in the period than the year-earlier quarter. Attendance was up 4% for Universal Studios in Los Angeles but down 4% in Orlando. One bright spot: DVD sales were up 20%, buoyed by the blithe musical "Mamma Mia!"

But Wall Street wasn't in a singing mood.

GE's shares plunged 10.7% after the call, in which executives reiterated how the "terrible credit markets" were hurting their businesses. GE stock closed at $12.03 a share. The industrial and financial giant delivered earnings of $3.65 billion, or 35 cents a share, down from $6.7 billion, or 66 cents a share, a year earlier. Overall revenue slid 5% to $46.2 billion.

-- Meg James

Photo: NBC offices in Burbank. Credit: David McNew / Getty Images