The sky-rocketing costs of lobbying for Academy Awards has Hollywood dreaming about campaign finance reform

By Christine Spines
Updated February 09, 2007 at 05:00 AM EST

Envelopes have yet to be opened. Foreign names have yet to be mangled. And the forced smiles of all the nonwinners have yet to be captured in reaction shots. But already this is shaping up to be a particularly cruel Oscar season. First came Dreamgirls‘ unexpected Best Picture snub. Then there was Paramount chairman and CEO Brad Grey’s ill-fated (and very public) bid for a producing credit on The Departed. And while we’re at it: Who’s the grinch hell-bent on ruining stars’ lives by announcing a ban on decadent goodie bags? These are the latest developments leading some to ask whether Hollywood’s ultimate honor is worth the trouble — and, more importantly, the money.

On average, studios can spend anywhere from $5 to $25 million mounting Oscar campaigns — even for films that may not clear that amount at the box office. ”Nobody doesn’t want to win Oscars,” says producer Mark Gill, a veteran of Miramax during its Oscar-obsessed ’90s heyday. ”But it may not be [the] focus it once was, given the financial pressure studios are under.” Explains an Oscar strategist, ”If a movie’s only taken in $20 million and you’re spending $5 million on the Oscar campaign, that’s 25 percent of the profits. It has to be about commerce as well as art.” One high-ranking studio exec concurs: ”It’s so expensive to campaign. We all just want to go back to making money.”

Of course they do. But for years, the tempting prospect of a relatively low-budget film (e.g., The English Patient, Million Dollar Baby, any of this year’s Best Picture nominees other than The Departed) winning an Oscar and subsequently raking in millions in awards-driven box office has kept studios gunning for gold. Problem is, today’s entertainment universe is controlled by Wall Street bosses who view Academy Award statuettes as the equivalent of Boy Scout merit badges. A disappointing run of epics like Memoirs of a Geisha and Cinderella Man (and, to some degree, Dreamgirls, whose combined theatrical and Oscar campaigns cost $35 million) has only made things more difficult for producers trying to finance the costly dramas that once screamed Oscar bait. ”The studio process isn’t focused on excavating these special stories,” says Cathy Schulman, who produced 2005 winner Crash. ”[Nobody’s] saying, ‘Where’s our Oscar picture?’ The priority of studios is to make money. That’s why it’s called the movie business, not the movie hobby.”

But in a town where perception is everything, the most valuable Oscar payoff may actually have nothing to do with cash. ”There are bragging rights to these things,” explains awards consultant Michele Robertson. ”In terms of pedigree this lends a certain amount of credibility to say, ‘We make quality movies.”’ So sophisticated dramas are turning up in greater numbers at Warner Bros., which produced two Best Picture contenders (Letters From Iwo Jima and The Departed) as well as Shantaram, an upcoming fugitive drama starring Johnny Depp. And Paramount is backing two David Fincher movies: the serial-killer drama Zodiac, which is generating favorable chatter before its March 2 bow, and the sci-fi fantasia The Curious Case of Benjamin Button, which reteams Babel stars Brad Pitt and Cate Blanchett. ”[We’re] looking for things that are ambitious, challenging, or offbeat,” says Paramount marketing chief Rob Moore. The key, he adds, is targeting films that can earn Oscar kudos and make money overseas. ”These movies work around the world.”

Putting aside the numbers for a moment, there’s a more visceral explanation for why a town filled with insatiable egos still courts that little gold man. ”What better way to be validated when you’re making hit movies and richer than God?” asks veteran campaign advisor Tony Angellotti. ”I don’t blame them. It really does feel good to win.”