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October 27, 2005
A Big Gorilla Weighs In
By SHARON WAXMAN
LOS ANGELES, Oct. 26 - In hiring Peter Jackson, the Oscar-winning director of the "Lord of the Rings" trilogy, to remake the monster classic "King Kong," Universal Pictures took a daring leap, paying him $20 million to direct, produce and be the co-writer of the film.

With seven weeks to go before the movie's release, the risks are becoming clearer. After seeing a version of the film in late September at Mr. Jackson's studio in New Zealand, Universal executives agreed to release "King Kong" at a length of three hours.

The film is substantially longer than Universal had anticipated and presents dual obstacles: the extra length has helped increase the budget by a third, to $207 million, while requiring the studio, owned by General Electric, to reach for the kind of long-term audience interest that made hits out of three-hour movies like "Titanic" and the films in Mr. Jackson's "Rings" trilogy.

Hollywood blockbusters have increasingly relied on big releases that bring in as much as half of their ticket sales on the first weekend. But long films receive far fewer showings per day, and the most successful ones, like "Lord of the Rings: The Fellowship of the Ring" (2001) by Mr. Jackson, which took in $315 million at the domestic box office for New Line Cinema, have remained in theaters for well over half a year.

The film industry and Universal could use a big seller.

Hollywood has been struggling this year at the box office, with overall revenue down more than half a billion dollars, about 8 percent, from last year's total, according to Box Office Mojo, an online tracking service. Industry experts attribute the decline to a migration of audiences to other forms of electronic entertainment, whether television, DVD's, video games or the Internet. Universal has had a mediocre year at the box office. The studio had a hit in the summer with the comedy "The 40-Year-Old Virgin," but has endured disappointments, like the drama "Cinderella Man," and has had lackluster results with films like "The Perfect Man," "Kicking and Screaming" and "Doom," which opened last week to a tepid $15 million.

Asked about the length of "King Kong," Universal executives said they saw it as an advantage in an era when jaded moviegoers are hungering for something extraordinary.

"This is a three-hour feast of an event," said Marc Shmuger, vice chairman of Universal Pictures, who described the film as a tragic love story between the ape and Naomi Watts, who plays Ann Darrow, an actress. "I've never come close to seeing an artist working at this level."

Set for release on Dec. 14, "King Kong" retells the classic beauty-and-the-beast tale first filmed in 1933, with its lasting image of Kong atop the Empire State Building, and remade in 1976. Along with Ms. Watts, it stars Jack Black, Adrien Brody and a 25-foot, computer-animated gorilla.

This time around, the picture depends upon another oversize talent in the person of Mr. Jackson, who was granted an unusual degree of control at a time when studios are trimming costs and tightening their grips on most productions. Not only did Mr. Jackson produce and direct, and also write with his longtime partner, Fran Walsh, and Philippa Boyens, but his companies Weta Digital and Weta Workshop also created the physical and computer special effects in the film at Mr. Jackson's studio in New Zealand.

Twentieth Century Fox and Paramount took a risk in granting the director James Cameron a similar degree of control over his famously overbudget 1997 film "Titanic," and eventually came up winners. In that case, Mr. Cameron's three-hour epic, a love story set in the midst of the ship's sinking, went on to break box-office records and win 11 Oscars. With "King Kong," Universal executives say they are convinced that they have an epic of comparable worth, even though they were surprised by the length.

"I anticipated it would be long, but not this long," the Universal chairwoman, Stacey Snider, said. As recently as late September, she expected about two hours and 40 minutes, she said. But on Wednesday she expressed delight with the picture she's got: "This is a masterpiece. I can't wait to unveil it."

The increased length, Ms. Snider said, means that the movie will cost $32 million more than planned, adding to expenses that had already gone up $25 million from an original $150 million production budget.

Who will pay for these budget overruns has been the subject of intense negotiations over the last two weeks, with representatives of the studio and the director haggling over who was responsible, according to those involved in the negotiations.

Ms. Snider said that as of Wednesday, all had been resolved, with the studio more or less splitting the $32 million expense with Mr. Jackson.

In an e-mail message, Mr. Jackson appeared to disagree, saying instead that he would be paying for those expenditures, which were mainly associated with extra digital-effects shots. Referring to his partner, Ms. Walsh, Mr. Jackson wrote: "Since Fran and I believed in the three-hour cut and wanted to take responsibility for the extra length, we offered to pay for these extra shots ourselves. That's what we're doing." He did not say how much that would be, but said the extra effects shot would cost "considerably below $32 million."

A spokesman for Universal responded, "We are working together to cover overages."

In granting Mr. Jackson immense latitude, Universal relied not just on his skills, but also a huge fan base, much of which has followed the production through the director's frequent communications on a Web site, www.kongisking.net.

But few elements of the film have been seen by the larger public, and even Universal executives saw a finished version of King Kong's face - with its expressive eyes, broadly fierce nose and mane of computer-generated hair - only in recent days.

Universal lost an opportunity to capitalize on a "Kong" revenue stream when an anticipated deal to release the film on Imax screens in December, at the same time the movie would appear in regular theaters, failed to materialize, and Imax chose to show Warner Brothers' new "Harry Potter" film, "Harry Potter and the Goblet of Fire."

"We think 'King Kong' will be a big movie," Richard L. Gelfond, co-chairman of Imax, said, "but unfortunately we could not agree on deal terms, including the box-office split."

Ms. Snider said Imax could not guarantee space in its theaters at the time of Kong's release, and acknowledged that both the studio and Mr. Jackson were disappointed.

A spokeswoman for NBC Universal said Bob Wright, the chairman, has been told of the rising cost and length of "King Kong." "Bob is more than aware of what is going on with this production and other major productions, and he has enormous confidence in the leadership team at Universal Studios," said the spokeswoman, Anna Perez.

Ms. Snider said she did not think the three-hour length would be an obstacle for moviegoers. Three-hour epics, she said, are Mr. Jackson's "brand."

Exhibitors have long complained that very long films make it harder to draw audiences, though in this difficult year at the box office, they have complained louder about not having enough good films to show. Paul Dergarabedian, president of Exhibitor Relations, which tracks the box office for theater owners, agreed that long movies posed problems. "But if it's a really fine film, it won't be a detriment to its success," he said.

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