KEY POINTS:
He is the father of the modern blockbuster, with a CV that includes some of the most famous films in history.
But even Steven Spielberg's career is suffering under the growing pressures of the economic crisis.
The movie mogul's hopes of creating a powerful independent production company have
been dealt a serious financial blow by the sudden, acrimonious collapse of talks aimed at securing a distribution deal with Universal Studios.
Spielberg, who recently "divorced" Paramount Pictures to turn his company, DreamWorks, into a private firm, announced at the weekend that negotiations with NBC Universal, which owns the studio, had broken down over a US$100 million ($190 million) funding gap.
Ironically, given that he is responsible for Jaws, ET, Indiana Jones and dozens of Hollywood's greatest box-office sensations, Spielberg has for months been struggling to raise the US$1.2 billion he needs to fund DreamWorks' ambitious slate of proposed films.
His deal with Universal, which was vital to the financial stability of the venture, fell apart after Spielberg suddenly asked the studio for US$100 million of extra cash to help plug a hole in DreamWorks' finances.
The studio privately called the request "despicable and deplorable", says the Hollywood newspaper Variety, which revealed that Spielberg had secretly begun funding talks with Disney in an apparent attempt to force Universal's hand.
"Over the past several weeks DreamWorks has demanded material changes to previously agreed upon terms," Universal said. "It is clear that DreamWorks' needs and Universal's business interests are no longer in alignment."
Until the director can secure the money from an alternative source he'll be unable to begin work on the 17 films that DreamWorks intends to produce over three years. They include Hereafter, written by Peter Morgan, a terrorist thriller called Motorcade, and the comedy Dinner for Schmucks with Steve Carell.
It's hardly the bright future the director imagined when he announced last year he was leaving Paramount to turn DreamWorks into an independent company. At the time, the credit markets were flush and raising US$1.2 billion appeared to be a piece of cake.
However, DreamWorks failed to secure a pay-TV deal with the cable channels HBO and Showtime, and was hampered by the collapse of AIG, which was due to provide a portion of its start-up cash.
A deal with an Indian company called Reliance Big Entertainment was conditional on Spielberg raising matching funding from other sources. But his bankers JP Morgan are struggling. At present, they are still hoping to raise US$325 million.
Neither Disney nor DreamWorks would comment.
But the proposed alternative tie-up may represent Spielberg's last hope of getting his company off the ground.
- INDEPENDENT