Warner Bros.' dynamic duo hang up their suits — after two decades on top of the Hollywood heap

By David Hochman
Updated July 30, 1999 at 04:00 AM EDT

Shortly after Warner Bros. cochairmen Robert Daly and Terry Semel said goodbye to some 500 employees during an emotional gathering July 16 at the studio’s Steven J. Ross Theater in Burbank, Hollywood’s longest-running management team walked past a photo of Ross, the Time Warner chairman who died in 1992, and blew him a farewell kiss.

It was a gesture that went beyond old-fashioned fondness for a tough boss. Ross had trained and mentored these two highly respected executives, who, a day earlier, had announced their resignation from Warner after nearly two decades. The kiss was as clear a sign as any that the Ross era — during which jet-setting moguls and their coterie of expensive talent lived like royals, sometimes in spite of the product they churned out — had officially drawn to a close. ”They’re the last of the old studio guys,” says George Clooney, whose work helped both make (ER) and bake (Batman & Robin) Daly and Semel’s reputation. ”It’s fitting this is happening at the end of the century.”

This famously amiable twosome, who frequently carpooled together and ruled a vast domain — Warner Bros. Pictures, Warner Bros. Television, The WB Television Network, Warner Music Group, Warner Bros. Consumer Products — couldn’t have picked a better moment to exit the stage. The day before, Time Warner (EW’s parent company) announced record second-quarter earnings, fueled in part by a rebound in Daly and Semel’s movie division. ”They wanted to escape while they still had all their pride,” says one top producer and friend. ”It’s like what Jerry Seinfeld did.”

Once the grand pooh-bahs behind box office gold like the Lethal Weapon and Batman franchises, the team had struggled lately — and not just with budget-blasting movies like Wild Wild West. They also hit some sour notes running the company’s $4 billion music group, which Time Warner chairman Gerald Levin, 60, assigned to them four years ago.

Daly, 62, and Semel, 56, have increasingly appeared insulated and static in the ’90s entertainment universe. By continuing to bet on high-priced stalwarts like R.E.M. and Madonna, Daly, in particular, was caught off guard by the youthquake rocking the music world (paradoxically, he played a winning hand by spearheading the launch of the Gen-Y-driven WB network).

And though the movie division scored recently with oldfangled hits like Robert De Niro’s Analyze This, Semel all too often tried to hit pay dirt with big-name stars, while indie movies, teen flicks, and mid-priced pics (There’s Something About Mary) soared. As Clooney puts it: ”The studios are getting away from these ‘event’ movies, but Warner Bros. was certainly guilty of [still doing] it. They would have a release date, a star, a director, and then say, ‘The script, well, we’ll fix the script later.”’

Still, for much of the duo’s tenure, Warner couldn’t have scripted better corporate chemistry. In addition to their vaunted movie franchises and the launch of The WB in 1995, they gambled and won a lucrative renewal deal for Warner TV’s ER. And they cultivated a classy image and a stable of stars that included Clint Eastwood and Mel Gibson, even as they took plenty of shots because of it. ”If we’re going to be criticized for giving Mel Gibson a Range Rover,” Daly says, referring to the studio’s gift to him for Lethal Weapon 2, ”then we take it with pride. We always supported creative people.”