The intoxicating rush of the Pocket Books deal had settled into the sobering reality of a bank balance.
In Duke's office, the atmosphere was one of fiscal solemnity. The large map of the United States was still the room's centerpiece, but now it was flanked by David Chen's spreadsheets, which lay across the desk.
"The capital from the paperback sale is isolated and secure," Chen stated, his finger tracing a column of numbers.
"Goldberg has drawn down two hundred and fifteen thousand for the first wave of prints, marketing, and his operational expenses for the Targets campaign. That leaves us with approximately one million, one hundred and thirty-five thousand dollars dedicated solely to building Ithaca Distribution."
Duke nodded, his gaze fixed on the numbers. It was one thing to conceptualize a million dollars; it was another to watch a fifth of it vanish into 35mm celluloid and railroad shipping costs. "And our operational liquidity?"
Chen smoothly transitioned to a second report. "Strong. The hardback royalties from Jaws and Cujo continue at a robust pace. Jaws remains at number one, and Cujo is holding steady at number three in the best seller list. This provides a more than sufficient revenue stream for all non-distribution expenses: salaries, overhead, pre-development for True Grit and Butch Cassidy, and the operating costs for Ithaca Records. We are, for the moment, financially secured. The hardback royalty funds the present; the paperback windfall is funding the future."
"And the future is a hungry beast," Duke mused, looking from the spreadsheets to the map. "We have no films in active production. Our entire production slate is in pre-development. That means for Q1 of 1968, and likely Q2, Ithaca Productions is a cost center, not a revenue generator. Our only active revenue-generating campaign is distribution, and it's currently a net loss."
"A strategic, anticipated loss," Chen corrected gently, but firmly. "But a loss nonetheless. Our capacity is stretched thin. We are attempting to launch a national distribution network, develop a major film slate, and sustain a record label, all with a skeleton crew. The risk is not insolvency; the risk is managerial collapse. We are currently at our operational capacity."
"Then we will expand our capacity," Duke replied, his tone leaving no room for argument. "Hire more people. But hire strategically. I'm not building a bloated studio. We're building a lean, specialized company."
As if on cue, Eleanor's voice came through the intercom. "Mr. Hauser, your eleven o'clock is here. A Mr. Jonathan Powell from the William Morris Agency."
The shift in the room's energy was palpable. Chen took his files and left directly, the conversation was going to continue later.
Mark Jensen slipped into the room just before the door opened, his expression a mixture of excitement and acute anxiety. He knew Duke's propensity for seismic company decisions.
Jonathan Powell entered with the polished grace of a man who sold dreams for a living. He was immaculately dressed, his handshake firm and practiced, his smile a calibrated tool. "Mr. Hauser, a pleasure. And Mark, good to see you. The entire town is talking about Ithaca, The Graduate investment, the paperback windfall… it's stunning in the circle."
"We been lucky, Mr. Powell," Duke said, gesturing for him to sit. "What can we do for William Morris?"
"It's more about what we can do for each other," Powell countered smoothly, crossing his legs. "You have vision and, if the trades are to be believed, considerable capital. In William Morris we have the greatest stable of creative talent in the world. We see an opportunity for a long-term, strategic partnership. A first-look deal, perhaps. Where William Morris brings you polished, pre-vetted projects, and you bring them the unique Ithaca touch."
He opened his briefcase and extracted a single, bound script, placing it on the desk with reverence. "This is Love Story, we believe it's the next great romance, a guaranteed hit. It has everything it's a tear-jerker, it has class conflict, Harvard and Radcliffe… it's got everything. The author, Segal, is our client. We believe this could be a first step on our parnertship."
Jensen, who had been nervously scratching his beard, looked up. He grabbed the script from Powell and read it on a side."
Duke's mind provided the data instantly Love Story a monumental, era-defining blockbuster. A financial juggernaut. A sure thing in a business of gambles. It was the kind of project that could fund his entire distribution expansion for two years or even more.
"I've heard the buzz," Duke said, his voice non-committal. "It sounds very… commercial."
"It's a license to print money," Forsythe affirmed, his eyes glinting. "We have a list of potential leads, of course. We're thinking Ryan O'Neal. For the female lead, perhaps a… well, an established starlet." He waved a dismissive hand.
"It's an interesting proposal," Duke said, leaning back, steepling his fingers. "But a 'guaranteed hit' usually comes with a guaranteed high price. I'm interested, but I'm not desperate. My capital as for now is allocated toward specific, strategic goals. Make me an offer that reflects a genuine desire for partnership. Have your people talk to Mark and David, I trust they'll run the numbers."
It was a masterful deflection. He had expressed interest without committing, put the ball back in their court, and shielded himself behind Chen's financial rigor and Jensen's creative skepticism.
Powell expecting either immediate enthusiasm or outright dismissal, was slightly wrong-footed. The meeting concluded with promises of follow-up, the Love Story script left on the desk.
As the door closed, Jensen let out a few words. "Duke, that script is… it's sentimental but if we can keep the script buyout and budget low we can get some profit."
"I like the story," Duke replied flatly, picking up the script. "never let your personal taste blind you to commercial reality, Mark. Women will love this kind of film. We'll consider it, at the right price of course."
He dropped the script into a drawer. "negotiate with them and see their bottom line."
---
The morning's tensions were broken by the arrival of Leo Walsh, who brought with him the chaotic, unpretentious energy of the music business.
"Finance and fancy agents," he grumbled, flopping into a chair. "A terrible way to spend a morning. I've got real news. Zaentz is calling. He's heard the whispers, I'm sure. He knows we're building our own distribution and that we've got the paperback money. He's asking for a meeting to 'discuss advertising and promotion' for the Creedence Clearwater Revival album. The bastard seems to want us to increase our cut of advertising and promotion."
"Set up the meeting," Duke said, a predator's smile finally touching his lips. "We're not desperate nor scared, if we invest more i will get a better deal.."
"On that note," Walsh continued, "I'm booking my flight to Gary, Indiana. It's time to meet this Jackson family. I'm telling you, that little boy, Michael, he's gonna be a big shot one day."
He then pulled another tape from his pocket. "And while I'm at it, I've been talking to some guys in Florida. A band called The Allman Brothers. It's a completely different sound. Blues-based with two drummers. Myabe you'll like them since they play something akin to country."
Duke listened, his strategic mind aligning Walsh's instincts with his own foreknowledge.
"Do it," Duke ordered. "Sign the Jacksons. Pursue the Allman Brothers. Ithaca Records can't be a one-band label, we need a roster."
Walsh grinned, his earlier frustration gone. "That's the plan."
He stood to leave, pausing at the door. "You know, for a guy with no movies in production, you sure havent spended much time with out only band, be careful if they leave after becoming famous."
After he left, Duke was alone again.
He looked at Chen's spreadsheets, the map of the USA, the drawer containing the Love Story script, and thought of Walsh heading to the Midwest.
The weight of it all was immense. He was managing a multi-front war: film distribution, film production, publishing, and music.
Chen was right; they were at capacity. Every decision here, in this office, sent ripples through the entire nascent organization.
He opened the drawer and looked at the Love Story script again. A safe, lucrative harbor. He then looked at the map, at the precarious beachhead they were trying to establish for Targets.
The meeting with Zaentz to decide on advertisement budget was now the next campaign. And he was planning on entering it from a position of strength.