MGM movies coming to YouTube, Google Play

Seeking to make more money from a library that still provides virtually all of the independent studio's revenue, Metro-Goldwyn-Mayer has signed a deal to rent more than 600 of its movies through Google's YouTube video site and its digital media store.

The partnership unveiled Monday covers more than 600 of MGM's best known titles, including "Rocky," "Terminator," "West Side Story," "Rain Man," "Robocop" and "Moonstruck." They will be available directly on YouTube or via Google Play, the tech giant's digital media store that offers movies, music, books and games to rent on the web and Android mobile devices.

Google already has similar movie rental deals with all of Hollywood's major studios, save 20th Century Fox, and 10 independents, including Relativity Media and Miramax. Typically, it charges $3.99 for new releases and $1.99 for older titles.

Though it is the leading player in online video-watching through YouTube, Google has a tiny share of the fast-growing but still nascent Internet video-on-demand business, which is dominated by Netflix and Apple's iTunes. The company is trying to grow its content collection, however, in order to better compete and make more revenue from online video.

MGM, meanwhile, wants to make its movies available as broadly as possible as it starts moving back into production under a new ownership and management team. Many of the titles it is offering through Google are already available to stream, rent or buy via Netflix and iTunes.

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-- Ben Fritz

Photo: Peter Weller in "Robocop 2." Credit: Orion Pictures

MGM buys back United Artists, adds Peter Liguori to board

Metro-Goldwyn-Mayer has bought back full control of its historic film label United Artists, the independent studio revealed in financial results reported this week. It also disclosed for the first time that television industry veteran Peter Liguori has joined its board of directors.

Formed in 1919 by a group of film luminaries including Charlie Chaplin and Mary Pickford, UA became part of MGM in 1981. In 2006, UA became a joint venture between MGM, Tom Cruise and his producing partner Paula Wagner, who together got 30% of the company. The new UA released only two movies, "Lions for Lambs" and "Valkyrie," before Wagner departed as chief executive in 2008, leaving the venture in limbo.

But MGM said in its 2011 financial results that it now owns a 100% interest in UA and it has bought back "Lambs" and "Valkyrie," as well as two later films financed by UA: "Hot Tub Time Machine" and "Fame."

The company also said it "may resume using the United Artists banner to develop and produce new films."

After former Pixar executive Ann Mather was named MGM's lead director in December 2010, former NBC executive Jeff Gaspin was expected to be named to the ninth and final spot on the company's board. Instead, MGM quietly tapped Ligouri, who was most recently chief operating officer of Discovery Communications and previously was a senior executive at the Fox network, for the spot.

An MGM spokeswoman did not respond to a question about when Ligouri joined the board.

In addtion to Mather, others on MGM's board of directors include former CBS Chief Financial Officer Fredric Reynolds, former MySpace Co-President Jason Hirschhorn, co-CEOs Gary Barber and Roger Birnbaum and representatives of the three investment funds with the largest stakes in the studio.

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-- Ben Fritz

Photo: Paula Wagner and Tom Cruise. Credit: Jasin Boland

MGM books loss on 'Dragon Tattoo,' expects profit on '21 Jump Street'

Returns of $231 million in worldwide box office wasn't enough to turn a profit on "The Girl With the Dragon Tattoo."

Metro-Goldwyn-Mayer disclosed in financial results released this week that it is booking what Co-Chief Executive Gary Barber called a "modest loss" on the film. On a conference call with shareholders, he said the independent studio, which covered 20% of the approximately $100-million production budget for the movie co-financed and distributed by Sony Pictures, needed "Dragon Tattoo" to collect about 10% more revenue in order to break even.

As a result, he said that while talks with Sony are ongoing for a potential sequel based on the second book in the "Millennium" trilogy by author Stieg Larsson, MGM would participate only "assuming we can achieve better economics" -- Hollywood-speak for a lower budget.

"Dragon Tattoo" was the first movie in which MGM invested after it emerged from bankruptcy in late 2010 under Barber and co-CEO Roger Birnbaum. The second, "21 Jump Street," which was also co-financed with Sony, hit theaters Friday and looks like a success. Barber said that based on opening weekend box office of $36 million, MGM expects the relatively inexpensive action-comedy starring Jonah Hill and Channing Tatum to be profitable. He added that his studio plans to participate in the sequel, in development at Sony.

Although MGM is a private company, it has a broad base of shareholders and reports quarterly financial results to them, as well as holding a conference call to discuss the state of its business.

In 2011, MGM reported operating income of $79 million on $699 million in revenue. The company did not provide comparable results for the full year of 2010.

The filings indicated that 57% of MGM's revenue came from television distribution, primarily of its library of 4,100 movies and 10,500 television episodes. The company has identified international TV sales as a key growth opportunity and last year signed new deals in Germany, Spain, Portugal and the Netherlands.

The company also said 27% of its revenue came from DVD and Blu-ray sales.

In the current year, MGM expects to see revenue grow significantly, largely due to its 50% interest in fourth-quarter releases "The Hobbit: An Unexpected Journey" and "Skyfall," the newest title in the studio's long-running James Bond franchise. Operating income will probably decline, Chief fFnancial Officer Dean Stratton said, due to increased costs for marketing and production.

MGM is in preproduction on the first two movies it has developed under Barber and Birnbaum: remakes of the 1987 action film "Robocop" and the 1976 horror film "Carrie," based on Stephen King's novel. Both are expected to be released next year.

Barber also noted that MGM is looking to shift its capital away from linear channels that the company owns -- television channels that play old MGM movies, for example -- and towards new opportunities in digital distribution. "We are actively exploring [joint venture] and investment opportunities. We're very bullish about our digital opportunities around the globe," he said.

Though MGM stock is not publicly traded, one person knowledgeable about the shares but not authorized to discuss them publicly said the price increased from $24 to $26 per share after financial results were released Tuesday. That gives the studio a total value of about $1.7 billion, the person said.

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Photo: Daniel Craig and Rooney Mara in "The Girl With the Dragon Tattoo." Credit: Merrick Morton / Columbia Pictures

MGM focused on international TV, even while making movies

At the studio known for big screen classics from "The Wizard of Oz" to the James Bond series to "Rocky," there's a new focus: international TV.

Under chief executives Gary Barber and Roger Birnbaum, who took control of the long-troubled company when it exited bankruptcy one year ago, selling titles from the 4,100 movie library to foreign broadcasters is a top priority. It's seen as the best way to make money off a collection of pictures that have already exhausted much of their revenue potential in the fading DVD market but are just starting to pick up steam on digital platforms.

Under its new chief executives, who trimmed the company from more than 400 to fewer than 300 and moved to a nondescript office building in Beverly Hills, MGM doesn't market or release movies. But it's still making them. For now, most are in partnership with other studios, like next week's "The Girl With the Dragon Tattoo," in which MGM invested 20% of the budget, and next December's James Bond film "Skyfall" and "The Hobbit: An Unexpected Journey," in which its ownership stake is 50%.

Starting in 2013, MGM plans to start releasing movies it develops itself. Many in development now are remakes of films from its library, like "Robocop," "WarGames," "Poltergeist" and "Idolmaker."

Either way, however, the international TV market still drives MGM's film business. On movies it co-finances, the new MGM prioritizes securing the right to sell the movies to foreign broadcasters. On films it develops, it looks for properties that will have strong appeal overseas.

The strategy is simple: Armed with movies that foreign broadcasters are eager to air, MGM hopes to be able to open doors to larger deals for its entire collection of movies and make more money off its library than would otherwise be possible.

For much more, see the story in today's Times on the new MGM one year into the reign of Gary Barber and Roger Birnbaum.

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Photo: MGM chief executives Gary Barber and Roger Birnbaum. Credit: Kevin Winter / Getty Images.

MGM lands new marketing chief

Metro-Goldwyn-Mayer has hired a new top marketing executive whose experience lies overseas, underscoring how important foreign markets are to the rebooted studio.

Doug Finberg, previously an international marketing executive at Marvel Studios, Paramount Pictures and DreamWorks SKG, has been named executive vice president of marketing at MGM, where he will oversee all publicity for the studio. He replaces Michael Vollman, who recently left the company after finding himself with a paucity of movies to sell.

Under new chief executives Gary Barber and Roger Birnbaum, MGM does not yet have domestic distribution rights to any movies that it is co-financing. However the studio does have a mixture of foreign theatrical rights in certain countries and foreign television rights to several films, including next year's James Bond and "The Hobbit" pictures and this December's "The Girl With the Dragon Tattoo."

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-- Ben Fritz

Photo: Doug Finberg, left, and Metro-Goldwyn-Mayer. Credit: MGM and Associated Press.

Icahn boosts MGM and Lions Gate stakes as he presses for merger

 
Carl Icahn still wants to see Hollywood's two lions get married.

The billionaire investor has increased his stakes in Metro-Goldwyn-Mayer and Lions Gate Entertainment as he continues to seek a merger of the two independent studios.

Since MGM and its roaring lion logo emerged from bankruptcy last December, Icahn has increased his holdings to about 20% from 15%, according to people familiar with the matter who were not authorized to speak about the company's financial details. He has bought the additional stock in private transactions, they said, because MGM's shares aren't publicly traded.

Meanwhile, over the last two weeks Icahn has acquired 756,840 shares in Lions Gate, growing his ownership to 33.2% from 32.6%. Last year, Icahn failed at an attempt to seize control of Lions Gate, whose management he has long criticized for its spending and business strategy.

Though Icahn's precise intentions remain murky, people familiar with the matter say he has continued to urge a merger between Lions Gate and MGM even though attempts last year at such an arrangement failed.

Icahn did not return a call seeking comment, and an MGM spokeswoman and Lions Gate spokesman declined to comment.

Many people in Hollywood have long thought a Lions Gate-MGM merger would make sense. Santa Monica-based Lions Gate, producer of the "Saw" films and "Mad Men," has stronger television and film production businesses, while MGM has a valuable library of about 4,000 titles and international television channels.

But talks last year fell apart over how to value each studio, leading MGM's creditors who controlled the company to put it in bankruptcy and put former Spyglass Entertainment chiefs Gary Barber and Roger Birnbaum in charge.

The two studios are not believed to be in merger talks now.

Meanwhile, Icahn has not signaled an intention to nominate board members or otherwise cause a stir at Lions Gate's Sept. 13 annual meeting like he did last year. But with his growing stake, such a move remains a possibility.

-- Ben Fritz

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Photo: MGM and Lions Gate investor Carl Icahn. Credit: Mark Lennihan / Associated Press

MGM marketing chief Michael Vollman exiting

With barely any movies to market since he joined the company three years ago or for the foreseeable future, Metro-Goldwyn-Mayer marketing head Michael Vollman is leaving the company.

Vollman, the studio's executive vice president of theatrical marketing, will depart when his contract expires in mid-August, a spokeswoman for the studio confirmed. He does not have a new position lined up.

MGM's financial woes led the studio to wind down its film business by late 2008, leaving Vollman, like many of his fellow executives, with little to do. It released only one movie in 2009, "Fame," and another the next year, "Hot Tub Time Machine."

Through at least 2012, MGM's motion picture business will consist primarily of co-financing movies that will be released domestically by other studios, such as the next James Bond picture and "Girl With the Dragon Tattoo" with Sony Pictures and two Hobbit films with Warner Bros. That will leave little for a head of theatrical marketing at MGM to do.

Vollman was one of a handful of senior executives who stayed on after MGM emerged from bankruptcy in December under new chief executives Gary Barber and Roger Birnbaum. Since then the company has laid off nearly 100 employees and hired several executives.

“Michael Vollman is a great executive. We could not have gotten through this enormous transition over the past 7 months without his clarity, his guidance and his commitment," Barber and Birnbaum said in a statement. "While his contract is ending, we are confident that our paths will cross again."

Before joining MGM in 2008 he worked in marketing at Paramount Pictures for two years and at DreamWorks Studios for a decade.

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Photo: Michael Vollman. Credit: Metro-Goldwyn-Mayer.

MGM names Roma Khanna head of television

Roma Khanna has joined Metro-Goldwyn-Mayer as president of the studio's television and digital group.  

Khanna, a former NBCUniversal executive, will oversee MGM's television sales, production, program acquisitions, licensing, content creation and digital initiatives, the company said Tuesday. She will be responsible for existing franchises and partnerships and report to Gary Barber and Roger Birnbaum, MGM's co-chairmen and chief executive officers.

“We look forward to Roma developing a robust slate of new television and digital content for markets all around the world," Barber and Birnbaum said in a statement.

Khanna was president of Universal Networks International and Digital Initiatives, overseeing more than 70 international TV channels, including Syfy Universal, 13th Street Universal and Movies24. However, she left a little over a month after Comcast Corp. closed on its deal to take control of NBCUniversal. 

Before joining NBCUniversal, she was senior vice president of CHUM Television broadcasting in Canada. She began her career at Sony Music Canada as manager of legal and business affairs.

-- Meg James

Photo of Roma Khanna; Credit: MGM

MGM to co-finance Sony's 'Girl With the Dragon Tattoo'

Metro-Goldwyn-Mayer will finance 20% of Sony Pictures' upcoming English-language remake of the Swedish hit "The Girl With the Dragon Tattoo."

The approximately $100-million production is being shot in Sweden, directed by David Fincher and starring Daniel Craig and Rooney Mara. It will hit theaters Dec. 21.

Sony and MGM's co-financing arrangement on "Tattoo," announced Tuesday, falls under a larger funding partnership the two studios struck in April centered on MGM's next two James Bond films. At the time, the studios said they would work together on other movies over the next five years.

MGM is likely to co-finance Sony's next two planned "Dragon Tattoo" films, based on a trilogy of bestselling books by Stieg Larsson, though no formal deals have been reached, according to a person close to the matter.

As with the Bond movies, Sony will market and distribute "The Girl With the Dragon Tattoo" around the world. MGM will get television licensing rights in certain foreign countries.

-- Ben Fritz

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Photo: Cover of "The Girl With the Dragon Tattoo." Credit: Random House

Sony and MGM finalize James Bond, co-financing partnership

Metro-Goldwyn-Mayer and Sony Pictures have closed an agreement to partner on the next two James Bond movies and potentially co-finance other pictures over the next five years.

However, their deal does not call for Sony to be MGM's primary theatrical distributor going forward, as the two studios had expected earlier in negotiations. MGM will not sign an overall theatrical distribution partnership with any studio, according to a person with knowledge of the matter.

Under the pact announced Wednesday, Sony will co-finance and release the 23rd James Bond movie, set to hit theaters Nov. 9, 2012, as well as a 24th Bond picture. Sony will fund half of the production costs of those films.

Sony will release the films in the U.S. and most foreign countries, with MGM retaining rights in a handful of overseas markets. MGM will also retain worldwide television and home video rights for both movies. The independent studio has been in discussions to extend its partnership with 20th Century Fox to release its library and new movies, including the Bond films, on DVD, but a deal has yet to be finalized.

The Sony-MGM partnership also calls for the two studios to explore opportunities to co-finance other movies over the next five years. Sony's English-language remake of the Swedish hit "Girl With the Dragon Tattoo," which is currently being shot by "The Social Network" director David Fincher, will likely be their first such joint venture, said people close to the matter. The two studios have also discussed co-financing Sony's remake of the science-fiction tale "Total Recall," which is due out in 2012.

Since MGM emerged from bankruptcy in December and secured a $500-million credit facility, one of the top priorities for its new chief executives, Gary Barber and Roger Birnbaum, has been landing a distribution partner, particularly for the Bond movies.

But with the decision not to have Sony release all of its films, MGM will now have to cut separate distribution agreements for its future movies. It is already working with Paramount Pictures on a "Hansel & Gretel" film for March 2012. MGM is also co-financing two "Hobbit" pictures with Warner Bros., which will release the movies worldwide.

Sony co-financed and theatrically distributed the last two Bond movies, "Casino Royale" and "Quantum of Solace," for MGM. It previously agreed to release the Kevin James comedy "Zookeeper," which the two studios co-financed, this July.

-- Ben Fritz

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Photo: Daniel Craig and Olga Kurylenko in "Quantum of Solace." Credit: Karen Ballard / Sony Pictures.