Chapter 424: Position Adjustments

After lunch with Spielberg, Simon returned to the administrative district's Building No. 1, where Amy Pascal was already waiting for him in the lounge next to his office on the fifth floor.

Simon had been dining with Spielberg, and Amy had also been busy inviting Robert Ream for a discussion. Originally, after acquiring New World Entertainment, Robert Ream was retained by Simon to serve as the President of Daenerys Entertainment's film distribution operations, a role he held from August 1988 to July 1991—meaning his contract was set to expire next month.

Due to some discontent related to pay raises and job-hopping, and because Simon was not entirely convinced of Ream's capabilities—considering also his relatively advanced age—Simon had decided not to renew his contract.

The topic of Amy's lunch with Ream was his departure next month.

After Robert Ream's departure, his position would be taken over by Mark Belfort, whom Simon had been actively grooming in recent years.

Signaling Amy to remain seated, Simon sat down opposite her and asked, "How did your talk with Bob go?"

Amy placed the newspaper she was casually flipping through on the round table in front of her and said, "Bob formally signed with Paramount yesterday. He'll finish handing over his duties here next month and then officially leave."

Since Daenerys Entertainment's acquisition of MCA, Ream had been looking for new opportunities.

Simon was aware of this; Paramount Communications' Chairman Martin Davis had even personally informed him.

Although there had been some friction, Ream had been largely diligent over the past three years. Therefore, Daenerys Entertainment's public stance was simply that his departure was due to a normal job adjustment.

There were no negative rumors circulating, and Daenerys Entertainment's recent performance in film production and distribution was evident for all to see. Having witnessed the rise of Daenerys Entertainment, Robert Ream naturally became a target for other studios.

Originally, Sherry Lansing, who was expected to join Paramount, was snapped up by Simon for MGM. Martin Davis, aiming to revitalize Paramount's dwindling film business in recent years, invited Ream to become the new president of Paramount Pictures.

"That's fine," Simon remarked, then added after a moment's thought, "Also, arrange a farewell party for Bob in the name of the company. We should give him the proper honors he deserves."

Amy nodded and asked, "You're going to England next week, so should we schedule it for mid-next month?"

"Wonder Woman" had already been filming in the UK for two weeks. After initial adjustments, some critical scenes were scheduled to start shooting next week.

As a major project for Daenerys Entertainment, Simon planned to be there in person for a week, unlike his more remote supervision for "The Flash."

"Let's plan it for the end of July then. In addition to the 'Wonder Woman' project, I also intend to visit Finland and possibly Italy. I might need to spend a few days on the East Coast too, as America Online's IPO is set for July 12th."

Amy agreed, then expressed her concern, "I worry that one day you might completely let go of managing Daenerys Entertainment."

"I can't let go," Simon said with a self-deprecating smile. "I guess I'm just one of those people who have a strong desire for control."

Amy shook her head slightly, looking at Simon and saying, "I don't think that's a bad thing at all. Daenerys Entertainment, and all other companies in the Westeros system, wouldn't be what they are without your direct oversight."

Simon took a sip of the coffee his assistant had brought over and nodded with a smile, "That's a nice compliment. Keep them coming."

After exchanging a few more pleasantries, Amy brought up another serious matter, "I've completed the layoffs for a thousand positions, but we still have significant redundancies in the production and distribution departments. Many former MCA employees are upset we haven't matched their salaries to those of Daenerys Entertainment employees, and some are even trying to get the unions involved."

After acquiring MCA, Simon initially planned to lay off 3,000 employees, reducing the combined workforce from 15,000 to 12,000.

However, as soon as some word of this leaked, there was significant attention from the media, unions, and federal agencies.

To avoid complications with two recent acquisitions, Daenerys Entertainment had to quickly publicly commit to a reduction of only 1,000 positions.

Before the merger, Daenerys Entertainment employees were paid significantly more than those at MCA and other industry peers. Because the layoff plans weren't fully implemented, Simon hadn't raised the MCA employees' salaries to Daenerys standards as usual.

Additionally, to distribute staff, Simon had been strengthening Daenerys Entertainment's overseas branches, constantly deploying many employees to markets in Europe, Latin America, and Asia.

Hearing

 Amy bring up this issue again, Simon considered it seriously for a moment and said, "Try to send more staff from production and distribution abroad, or move some into departments like records and games under Nancy's control, which largely overlap in skills. As for salaries, send them a formal notice that any adjustments must wait at least a year, pending a proper evaluation of their capabilities."

Amy said, "The main issue is that many people don't want to be relocated, especially to Eastern Europe, Latin America, or certain Asian countries, as you know."

"These are critical areas for Daenerys Entertainment's next steps in international expansion. Even if we don't make money there now, cultivating these markets early and familiarizing people with the Daenerys brand will eventually pay off. Regarding the next relocation plans, hmm... I'll talk to Mark personally tomorrow. We don't need to accommodate the employees' wishes too much. If they're being paid and hope to earn more in the future, they should be willing to accept reassignments."

Simon added thoughtfully, "Wait until early next year. If we still have redundancies then, we'll carry out a second round of layoffs. By that time, whatever people say won't really matter."

After discussing the progress of the Universal Studios Osaka project, Amy had to prepare for a trip to Japan next week.

As they were talking, they were interrupted by a greeting.

Turning around, Simon saw his assistant approaching with a middle-aged man, prompting him and Amy to stand.

The visitor was Tom Pollock, the president of Universal Pictures under MCA.

Tom Pollock, in his forties, was not very tall, with the distinctive large nose of a Jewish man and somewhat balding, along with a pair of recognizable droopy eyes.

MCA's Chairman Lew Wasserman and President Sid Sheinberg had resigned after the transaction, hanging on only in advisory roles of a clear nature.

Following the merger, since Amy needed to oversee the entire Daenerys Entertainment operation and could no longer manage Daenerys Pictures herself, Simon had kept Tom Pollock on board.

After adjustments during this period, Tom Pollock now served as the president of Daenerys Pictures, also handling the division and integration of Universal Pictures with three other labels under Daenerys Entertainment.

While it seemed somewhat unfair to the presidents of Gaumont and New World Pictures, Eila Doitchman and Danny Morris, Tom Pollock actually had much less authority than either.

Gaumont and New World Pictures were set to further evolve into independent production and distribution systems focused on their respective genres.

Thus, Doitchman and Morris were akin to powerful regional governors.

The real power of Daenerys Pictures, however, still lay in Simon's hands, with Tom Pollock playing a supporting role mainly responsible for contract negotiations, personnel communications, budgeting, and other administrative tasks.

As the central creative authority of a production studio, Tom Pollock had no influence over it, and the film distribution duties would be handled by Mark Belfort, who was about to take over from Robert Ream.

Furthermore, Tom Pollock's prior role as a director of MCA's Cineplex-Odeon chain had been replaced by Nancy Brill.

Although not entirely satisfied with his current situation, Tom Pollock had few complaints and even felt somewhat fortunate.

He had thought he would need to resign like Wasserman and Sheinberg when Simon insisted on control of MCA, but instead, he was able to stay.

In Hollywood, where roles were as scarce as carrots for holes—especially after the contraction from eight to seven major studios—it was difficult to find comparable positions. Warner Brothers had Terry Semel, Columbia had Peter Guber and Jon Peters, Fox had Joe Roth, MGM had Sherry Lansing, and Disney had Jeffrey Katzenberg.

The last studio, Paramount, was almost certainly going to Robert Ream, soon to depart from Daenerys.

At Daenerys, with a robust lineup, Tom Pollock lacked the kind of golden parachute that Wasserman and Sheinberg had to retire comfortably. In his forties, he was not ready to retire, but there was no place for him at the top-tier studios, and he was too prominent for lower-tier studios in the short term.

Now, holding the position of president of Daenerys Pictures, though with limited power, was still prestigious. Anyone with some experience in Hollywood understood that it was a position that could significantly enhance one's resume.

Executives in Hollywood studios frequently moved around; spending a few years in this position would, at the very least, enable him to secure a real power-bearing role in a production studio when he left, or possibly even take charge of an entire media conglomerate.

After exchanging greetings, Amy departed to attend to her own tasks.

Simon did not return to his adjacent office but continued to sit by the window in the lounge and began discussing work with Pollock.

"I met this morning separately with the agents of Robert Redford and Adrian Lyne. The two seem to have communicated

 privately; compared to the initial offer of a $5 million base salary plus 15% of domestic gross revenue sharing, they've both made concessions. I've negotiated the revenue sharing down to 10%, and Adrian's base fee to $3 million."

Tom Pollock was discussing the "The Peach Transaction" project, a collaboration between Daenerys Entertainment and Paramount.

Brian De Palma had withdrawn from directing the film due to concerns over managing the subject matter, prompting Simon to extend an invitation to Adrian Lyne, the original director.

Adrian Lyne, known for "Nine and a Half Weeks"—which, despite being controversial, was not his most successful box office hit. In fact, the box office performance of "Nine and a Half Weeks" was very poor. Lyne's most successful film was "Fatal Attraction," starring Michael Douglas, which had grossed $300 million globally four years earlier.

Before that, Lyne had also directed "Flashdance," which entered the top ten in box office earnings for 1983. The film followed the musical trend set by "Grease" and was controversial but achieved over $90 million in box office revenue in North America alone on a $4 million budget, ranking third in that year's box office.

Despite successes like "Flashdance" and "Fatal Attraction," Lyne's box office performance had been inconsistent over the years.

After "Fatal Attraction," Lyne's last year's collaboration with Bruce Joel Rubin, who had become famous with "Ghost," titled "Unworldly Life," had a production budget of $25 million but only made slightly over $26 million in North America.

Moreover, with Lyne's low productivity—directing a film every three years—it was challenging for him to maintain top-tier pay.

Simon listened to Tom Pollock's summary and was very pleased with his work.

As long as both parties were willing to share profits, Robert Redford's $5 million base salary and Adrian Lyne's $3 million, perfectly matched Simon's expectations.

Regarding the 10% of domestic gross revenue share, this referred to 10% of the box office proceeds Daenerys Entertainment received from theaters. Assuming a $100 million domestic box office and a 55% studio share, 10% would amount to approximately $5.5 million.

If the two could ensure "The Peach Transaction" surpassed $100 million domestically, each taking an additional $5.5 million was justifiable.

Tom Pollock, assured that Simon had no objections to these salary arrangements, continued, "Since that's settled, I'll finalize contracts with Bob and Lyne soon. Additionally, Demi Moore's agent has asked for a $5 million salary, and I've talked with ICM a few times. They haven't budged, insisting that Moore isn't lacking offers right now."

Demi Moore was the original female lead of "The Peach Transaction."

Simon had been hesitant about casting Moore again for this role. He had read the original work and script, and felt that the female lead, Diana, should be more of a girl-next-door type.

As for Demi Moore.

Perhaps due to the many messy scandals associated with her, Simon found it difficult to fit Moore into this role.

Hearing Tom Pollock say this, Simon pondered for a moment and then said, "If that's the case, let's pass on Demi. Try reaching out to Valeria."

"Valeria Golino?"

Simon nodded, "Yes. Her performance in 'Rain Man' fits Diana's character well."

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