Chapter 429: The Bronfman Heir's Folly

As Columbia Tri-Star commenced reforms under the management of Nobuyuki Idei, the new president of Sony, MCA Universal was sold by Panasonic; it was clear by now that the entry of Japanese companies into Hollywood was not a success!

At the Peninsula Hotel in Beverly Hills, Edgar Bronfman Jr., chairman of MCA Universal's parent company Seagram Group, hosted a grand celebratory banquet; however, neither MCA Universal's CEO Lew Wasserman nor President Sidney Sheinberg were seen at the event.

"Looks like MCA Universal is in for a major management shakeup as well," Disney Chairman Michael Eisner chatted with major shareholder Sid Bass nearby.

Sid Bass wasn't too concerned about others, but was quite interested in Disney's situation.

"How are we handling Jeffrey Katzenberg's severance? He's already had his lawyer send us a letter," Bass remarked.

"Don't worry, I've handed the conflict with Katzenberg over to Ovitz," Michael Eisner responded.

"Alright then," Bass nodded.

...

Meanwhile, Arthur was discussing home DVD technology with Time Warner's Chairman, Gerald Levin.

On one side, Toshiba and Panasonic led the SD standard alliance, attracting support from Time Warner, MCA Universal, Viacom Paramount, and entertainment groups like Disney; Toshiba and Panasonic were shareholders of Time Warner and Universal, respectively.

On the opposite side, Philips and Sony headed the MMCD standard, backed by film companies like Sony Columbia, Twentieth Century Fox, and Galaxy MGM.

Galaxy's backing of the MMCD standard was mainly due to Philips. After Siemens withdrew from PolyGram a few years back, Philips now held sole control. PolyGram, also a shareholder of the Mirror Group, was willing to grant voting rights to Galaxy Publishing Company, making Galaxy the majority shareholder of Mirror Group.

"The value of DVDs is clear to everyone, so what our Hollywood alliance needs to do now is to quickly unify the standards!" Arthur didn't want to see both sides wasting time over the format dispute.

"Don't worry, Arthur, both sides are engaged in friendly negotiations," Gerald Levin smiled. "I believe a new generation of DVD players will be introduced soon!"

Levin was confident because the Toshiba-Panasonic side was clearly more advantageous than the Sony-Philips side at the moment. During this time, the main players were not Hollywood content providers but the manufacturers from Japan and the West.

...

Edgar Bronfman Jr. soon sought out Arthur. Last year, Edgar Bronfman Sr. retired at the age of 65, serving only as co-chairman of Seagram, passing the CEO role to his son, Edgar Jr., who was in his 40s.

"Arthur, you know, I've always had a keen interest in the entertainment industry, having worked in British theater and Hollywood earlier," Edgar Jr. expressed his love for the arts.

Arthur smirked inwardly; here was someone who had done nothing of note while wandering abroad for over a decade, only to come home and inherit a fortune.

"MCA Records and Universal Pictures are perfect platforms for you to showcase your talents," Arthur enjoyed dealing with heirs lacking business acumen, "Hollywood will definitely have a place for you in the future."

Edgar Jr. clinked glasses with Arthur, "Unfortunately, Universal's current state isn't great, with substantial losses and excessively high movie production costs!"

Arthur gestured toward a direction, "Look, Sony Columbia is making waves in Hollywood again. The newly appointed head of production, Mark Canton, has directly raised male star fees to $20 million, with female stars' fees also surpassing $10 million!"

Last year, Meg Ryan set a new record with her $8 million fee, but this year, Demi Moore took female star fees beyond the $10 million mark, becoming the first actress to command such a fee.

Edgar Jr. was helpless; he knew such actions made other movie companies quite unhappy. But what could he do? After Jim Carrey demanded $20 million, other top male stars like Arnold Schwarzenegger, Mel Gibson, Tom Cruise, Tom Hanks, and Harrison Ford would expect similar compensation!

...

"Arthur, good evening," an older man approached. "I'm Herbert Allen!"

He extended his hand to Arthur, who had heard the name before. The man was Herbert Allen Jr., president of New York boutique investment bank Allen & Company. 

"Is there something you'd like to discuss?"

"For the Sun Valley Conference in July, we'd like to invite you to Idaho, where many company bosses from finance, energy, entertainment media, and tech news sectors will attend."

The Sun Valley Conference was a summer camp event initiated by Herbert Allen Jr.'s father, Herbert Allen Sr., in the early 80s; it was nicknamed the "Billionaire Summer Camp" because of the wealthy guests from various industries.

"Arthur, you'll meet heads of companies like Disney, Time Warner, Liberty Media, and Capital Cities/ABC, CBS among others. I think you'll gain a lot..."

Listening to Herbert Allen Jr.'s invitation, Arthur became interested in the Sun Valley Conference. "I will arrive on time!"

...

In the lounge area of the banquet hall, Sid Bass and Arthur sat on a sofa. "Last year, the North American box office market surpassed $5 billion."

Disney's The Lion King grossed $770 million worldwide, while Galaxy's Forrest Gump earned $670 million globally!

"This is Hollywood's platinum era," Arthur chuckled, "With more hot money from Wall Street and European capital pouring into Hollywood."

"See, a distilling giant has also ventured into the entertainment industry," Sid Bass glanced over at Edgar Bronfman Jr.

"Do you think someone like that poses any threat to you?"

Edgar's selling of DuPont Co. shares had earned him the label "The Bronfman Heir's Folly" from Wall Street. The Bronfman family's Seagram Group, as a major stakeholder in DuPont, derived two-thirds of its income from DuPont's revenue.

Meanwhile, the Bronfman family leveraged DuPont's resources and network to expand into various American industries. Arthur remained silent, aware that Hollywood not only faced international industrialization but also intense internal competition.

Nowadays, Hollywood film companies were no longer mere film businesses; media television stations and diversified group strategies had already taken shape.

*****

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