Thursday Reading: 'Wolverine' piracy, Hulu, Star Salaries, ShoWest, and More

- An unfinished version of 'X Men Origins: Wolverine' seems to be available online, a month before its scheduled release. Brian Stelter of the New York Times writes:

Eric Garland, the chief executive of the file-sharing monitoring firm BigChampagne, called the widespread downloading of “Wolverine” a “one-of-a-kind case.” “We’ve never seen a high-profile film — a film of this budget, a tentpole movie with this box office potential — leak in any form this early,” he said.

The studio, a unit of the News Corporation, spent the day demanding that copies of the film be removed from the largely anonymous swath of Web sites that swap movie files. But the copies propagated at such a swift rate that the digital cops could not keep up. BigChampagne estimated the digital film copy had been downloaded in the low hundreds of thousands of times in its first 24 hours on the Internet.

The studio said the F.B.I. and the Motion Picture Association of America were both investigating the film’s premature distribution.

- Interesting piece in BusinessWeek about Hulu's success at attracting viewers... but its problems selling advertising.

- In the recession, Hollywood studios are changing the way they pay big stars, according to The Wall Street Journal. Lauren Schuker writes:

For years, top movie stars often landed deals paying them a percentage -- sometimes as much as 20% -- of a studio's take of box-office revenues from the first dollar the movie makes, even if it turned out to be a flop that cost the studio millions. As a result, the biggest celebrities broke the $20 million mark. Eddie Murphy got that kind of payday for the flop "Meet Dave," which cost Twentieth Century Fox about $70 million and took in only $11.8 million at the domestic box office.

These "first-dollar gross" deals are hitting the cutting-room floor as studios slash the number of movies they're making. For two new projects, Viacom Inc.'s Paramount Pictures has done away with such deals, even though it has landed top talent. In "Dinner for Schmucks," with Steve Carell, and "Morning Glory," starring Harrison Ford, the actors accepted "back-end" deals, in which they get a portion of the gross, but only after the studio and its financing partners have recouped their costs. The studio also cut a back-end deal with "Dinner" director Jay Roach.

- The NY Times reports that the annual ShoWest convention in Vegas, where studios present their forthcoming product to theater-owners, is smaller and lower-key than usual this year.

Variety has its ShoWest coverage here.

'Kodak's Reign in Hollywood Threatened by Digital Cinema'

Among the most entertaining people to talk to in the entertainment industry are Kodak executives.

At ShoWest in 1999, Kodak exec Bob Mayson proclaimed that digital cinema would never happen until directors and producers decided to back it. Later that day, George Lucas announced that 'Star Wars: Episode I' would be shown digitally in four theaters later that summer. My favorite quote from that year's ShoWest coverage:

“That sound you heard during the Star Wars trailer was 20 guys from Kodak jumping off the roof of the hotel,” quipped one exhibitor.

This week, Dow Jones has an update on Kodak's digital cinema efforts, and it seems like not much as changed. AccessIT, the leader in converting theaters to digital cinema, has converted 3,000 screens. Kodak has 80. From the piece:

Mary Jane Hellyar, president of Kodak's film products group, said the company's goal is to position itself to be competitive, not necessarily move to grab the dominant market share right out of the gate. "The numbers are reflective of the strategy," she said.

"We're learning from our installations and also learning from what others are doing in the marketplace. It is our goal to be a key player in this space, making sure we're positioned to have the kind of offering that the industry would expect," Hellyar said.

Video Spam a Growing Problem ... LA Times on Viacom's Motives ... and ShoWest News

- The Wall Street Journal (subscription required) has a piece headlined, 'Spam Hits Video Sites, Misleading Web Viewers.' Spammers upload videos to advertise a product, but then describe them as something else entirely -- like Paris Hilton in the buff. Sites like AOL say they've noticed an increase in the past six months. Kevin Delaney writes:

or spammers, there may soon be a clear economic incentive to post bogus videos: More video sites may start sharing ad revenue with the people who upload videos. For example, spammers could be paid each time someone viewed a video they posted or clicked on an ad accompanying their clip. YouTube executives have said they might share revenue with individuals in that way eventually.

Such an approach could encourage spammers to increase the use of false pretenses to draw users. But Revver Inc., a site that already pays people when ads accompanying their clips are clicked, says video spam submitted to it has actually dropped over the past year. It says its employees review each clip before putting it up on the site.

- The LA Times says that Viacom's suit against YouTube is all about money and control. Most interesting quote is at the very end:

Viacom CEO Philippe P. Dauman said his company went to court to enforce its copyrights and protect its valuable brands, such as MTV, Comedy Central and Nickelodeon. That doesn't mean Viacom won't one day strike a deal with YouTube. "Certainly, Dauman said, "we could find ways to operate in a YouTube environment that would be compatible with our brands."

- Sharon Waxman of the NY Times reports from ShoWest. She notes:

Exhibitors have ... not rushed to install digital projectors in their theaters, an expensive process whose cost they are sharing with Hollywood studios. After years of discussions with manufacturers, there are now 2,300 screens across the country with digital projectors, still a small fraction of the nation’s 37,000. The higher-quality equipment is not expected to be widely installed until 2009, when a few high-profile movies in 3D requiring digital projection (like James Cameron’s “Avatar”) are scheduled for release.

ShoWest 2007 News: Opening Talks from the MPAA and NATO

ShoWest officially opened yesterday in Las Vegas, with speeches from NATO head John Fithian and MPAA head Dan Glickman. The mood seems pretty bouyant, according to the Variety and Hollywood Reporter coverage. Everyone's jazzed about this summer's releases, which star pirates, Harry Potter, Shrek, Danny Ocean, and Spider-man. At the opening session of ShoWest, Disney showed the audience a short trailer for the third 'Pirates' pic, and also a 12-minute segment from Pixar's 'Ratatoiulle,' which opens June 29th.

You can read the opening addresses from Fithian and Glickman (both are in PDF form.) The big themes were piracy and preserving the theatrical release window.

Fithian also noted that there are about 2300 screens now capable of digital projection in the US, and said the roll-out will "accelerate considerably" in 2008. He predicted that 2009 will be a "bellwether year" for 3-D projection.

Also, he said:

It became fashionable during the downturn of 2005 to pit emerging technologies against the great American tradition of going to the movies, to see new technologies as some seismic shift in consumer preferences—and therefore to depict movie theatre operators as frightened by and hostile to new technologies. Nothing could be further from the truth. In fact, in so many ways, the exhibition industry is exciting and dynamic today precisely because of new technologies— and not only because we’re now embarking on the most technologically significant and sophisticated revolution in exhibition history with the advent of digital cinema. Our appreciation extends even to home technologies. A recent survey by Nielsen Entertainment confirms that consumers with many home technologies are actually more avid moviegoers than those with fewer home technologies.

Hmmm -- does that list of home technologies include YouTube and the Internet, John? I wonder....

ShoWest opens in Vegas ... Eisner dips into Web content production ... What's happening at ClickStar?

- Gregg Kilday of the Hollywood Reporter is blogging from ShoWest in Las Vegas, the annual conclave that brings together theater owners, studio execs, and lots of vendors. The Reporter also has a few ShoWest stories: Dolby's new 3-D system will compete with the system made by Real D. (Here's Dolby's press release.) A satellite services company called Microspace will be beaming the feature 'Disturbia' to ShoWest for a Tuesday screening. And finally, NATO head John Fithian admits he was wrong about the revenue potential of digital 3-D:

"I'm willing to accept the fact that I was wrong because I did not believe that 3-D would be as big of a catalyst as it is now," John Fithian, president of the National Association of Theatre Owners, said in The Hollywood Reporter's ShoWest roundtable. "3-D is becoming a much bigger value add than I originally thought. 'Chicken Little' and 'Nightmare Before Christmas' blew the socks off all our members. When you can take a product that's been around for a while and bring it out and make $9 million, that's impressive."

- Michael Eisner is launching a digital content development studio called Vuguru, according to The Wall Street Journal. (The LA Times also has coverage. From the Journal's piece:

"Vuguru's goal is to be the leader in producing high-quality, story-driven content for the Internet that up until now could only be found in movie theaters or on television," Tornante said. [Tornante is Eisner's private investment company.]

"In the past few years, the development of exciting and innovative digital media platforms and technologies has outpaced the creation of truly great content," Mr. Eisner said. "Vuguru will produce and showcase original and third party content in all genres and formats to meet the new demands of the evolving media landscape."

Here's a look at their first project, Prom Queen, which will consist of 80 episodes, each 90 seconds long. It'll show up on Veoh ( a video site Eisner has invested in ), as well as YouTube and other sites. Pretty cool experiment, but one question: how will Vuguru place advertising on the clips it posts to YouTube?

- ClickStar, the site that is a joint venture of Intel and Morgan Freeman's production company, Revelations Entertainment, has split with its interim CEO, James Ackerman, according to Variety. Lori McCreary, Freeman's co-producer at Revelations, will take over as CEO. (ClickStar's original CEO, Nizar Alibhoy, left last January.) Ben Fritz of Variety writes about the next Internet feature ClickStar will release:

Company hopes to get a second boost from "Lonely Hearts," an indie pic that will be available for download at ClickStar on April 27, two weeks after it hits theaters. True-crime story, which Roadside Attractions and Samuel Goldwyn Films are releasing, is written and directed by Todd Robinson and stars John Travolta and Salma Hayek.