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Warner Bros Taking WW Distribution (And Paying For) ‘The Hobbit’

Mike Fleming

UPDATE: I’ve learned that Warner Bros will, in fact, pay the entire cost of the two installments of The Hobbit, a price-tag that is expected to exceed $500 million. Now, the question will be which cast members from The Lord of the Rings come back for encores. I’ve heard talk of conversations with Ian McKellen, Andy Serkis and possibly Elijah Wood. I’d heard Orlando Bloom was also in talks before the holidays. Returning actors will need to be locked in shortly.

BREAKING: MGM and Warner Bros have finalized a deal that gives Warner Bros worldwide theatrical distribution on  the Peter Jackson-directed The Hobbit. MGM will retain international television rights. This solves another problem on Jackson’s eagerly awaited followup to The Lord of the Rings, which has overcome an MGM freeze because of angry creditors, and the threat that the films would move away from New Zealand after local unions blacklisted the production.

Shooting begins next month, and Jackson is still in the process of locking in cast from the original movie, which is expected to include Ian McKellen’s Gandalf, Andy Serkis’ Gollum, and others. MGM, a half partner in The Hobbit, was expected to bow out of its international distribution role because the studio came out of prepackaged bankruptcy–headed by Spyglass partners Roger Birnbaum and Gary Barber–with the intention of initially reviving the studio as a production company that contracts out distribution and marketing to others. Still trying to figure … Read More »

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New Zealand Passes “Hobbit” Deal: Opposition MPs Call It “Day Of Shame”



The New Zealand parliament has passed emergency legislation ensuring that the 2 back-to-back Hobbit films get made in the country. The legislation bypassed usual parliamentary committees, prompting New Zealand MPs to call it a “day of shame.” One held up a redesigned national flag with the Warner Bros logo in one corner. “What is the government going to do next – give in to any multinational that asks for a labour standard to be diluted in return for some form of investment?” asked opposition MP Charles Chauvel. The amendment was passed by a 65-50 vote. The government’s decision to rush through amended employment laws – stopping below-the-line workers from being treated as full-time employees, with all the rights which go with being a salary man — has divided local opinion. The above political cartoon is from a New Zealand newpaper. Meanwhile, some actors union officials though have received death threats after threatening a boycott. Prime Minister John Key has defended his government’s tax deal that secured The Hobbit movies as being far less generous than the opposition’s Lord of the Rings deal. The Hobbit tax deal is understood to be worth $57 million to Warner Bros across 2 movies. Key suggested that the previous Labour government’s Lord of the Rings deal was worth $225 million across all 3 movies. Warner Bros as well as producer/director Peter Jackson had been threatening to move the production to England or Western Europe.

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Official: ‘The Hobbit’ Stays In New Zealand

Producer/director Peter Jackson is celebrating. Warner Bros executives were locked in negotiations all day with New Zealand government leaders. Then Prime Minister John Key announced at a press conference tonight that The Hobbit back-to-back movies will be made in New Zealand. That’s a $500+ million project, and the Hollywood studio bargained considerable perks for itself. Tax rebates of up to an extra $7.5 million per movie are arranged, subject to the success of the pics. The NZ government will offset $10 million of Warner Bros’ marketing costs as part of the strategic partnership. And New Zealand will also host one of the world premieres of the Hobbit movies. The NZ Government and Warner Bros also agreed to work together in a “long-term strategic partnership” to promote New Zealand as both a film production and tourism destination. Said Key: “My Government is determined to use the opportunity that the Hobbit movies present to highlight New Zealand as a great place to visit, as well as a great place to do business.”

The NZ government will introduce legislation tomorrow to clarify the distinction between independent contractors and employees as it relates to the film industry only, according to news reports. “The industrial issues that have arisen in the past several weeks have highlighted a significant set of concerns for the way in which the international film industry operates,” Key said. “We will be moving to ensure that New Zealand law in this area is settled to give film producers … Read More »

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Peter Jackson Bares ‘The Hobbit’ Dispute

Mike Fleming

Warner Bros and Peter Jackson next week will try to hash out whether the $500 million budget for back-to-back The Hobbit films will stay in New Zealand or move elsewhere. Meetings are planned that will involve Prime Minister John Key. Here’s a terrific dispatch from New Zealand Close Up: it’s long but is well worth it because it puts Jackson and Philippa Boyens on the record, lays out the stakes, and gives a real sense of the backlash directed toward the New Zealand Actors Equity and Australian Media Entertainment & Arts Alliance for blacklisting Jackson and his pictures. There are certainly hard feelings but here’s my prediction: These things come down to leverage, and Warner Bros walks in with a lot of it. I bet the studio will emerge with a sweetened deal to stay. Estimates I’m hearing include incentives that shave $10 million to $15 million off the budget. Part of the charm of The Lord of the Rings was how it revealed New Zealand as a an epic location and tourism mecca, with Jackson also plowing a lot of his Rings profits into building state of the art facilities that have turned the country into a thriving film center. It just won’t be good karma to shoot elsewhere.

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Peter Jackson Directing ‘The Hobbit’? TOLDJA!

Mike Fleming

I saw yesterday’s breathless reports that Peter Jackson is close to a deal to direct The Hobbit – and I am bewildered how anyone slaps an “exclusive” tag on a story Deadline broke back on June 25th. That’s when Jackson moved from co-writer/producer into the director’s chair. Recent reports by the LA Times and NY Times have added some nice details, but I laid out back then the chain of events that are unfolding now. Even before Guillermo del Toro withdrew as director, Warner Bros and MGM had set December 2012 and December 2013 as release dates, replicating the release pattern of the original The Lord of the Rings trilogy. Production has to begin in January or these pictures would get pushed back an entire year — and who knows if Jackson would have stayed? Deadline advised that MGM’s creditors needed to get their heads out of their you-know-where’s and either commit funding or step aside to let Warner Bros  pay for the films. It was clear those decisions would precede a long-planned prepackaged bankruptcy that won’t play out until year’s end. 

The 3D discussion also goes back before Del Toro departed, but I can confirm a NYT report that they’re locked into a 3D two-picture shoot that will cost around $500 million. Unless a third party steps in, Warner Bros most likely funds production because MGM can’t. The movement on The Hobbit doesn’t help James Bond, which is post-bankruptcy business. … Read More »

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Can ‘The Hobbit’ Wait For MGM Decisions?

Mike Fleming

MgmlogosmallEXCLUSIVE: My recent scoop that Peter Jackson is negotiating to direct the two installments of The Hobbit is probably the best news for debt-laden MGM in years. But the development has put extra pressures on the beleaguered studio backers. Because making a 2-picture directing deal with the Lord Of The Rings director is no easy feat. I’m told that 30% of the gross is already committed to various participants, including Jackson (just for writing and producing!). peterjackson-9He and Fran Walsh don’t work cheap, and they once got $20 million against 20% of gross from Universal to direct King Kong (Jackson, who can’t get enough of Kong and just oversaw the renovation of the ape attraction on the Universal backlot). Insiders tell me that gross participants are right now being asked to make adjustments so that MGM and its partner, Warner Bros, can finance the film and make money. Creative deals are becoming routine on sequels like Men in Black, but they aren’t easy. There’s no certainty that MGM creditors will respond to the urgency that Jackson’s reps are ready to make a deal. Read More »

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