A new week began, and with most fall season scripted shows not premiering until October, Daenerys Entertainment's reality programs continued to dominate the ratings.
The three weekly episodes of Who Wants to Be a Millionaire were strictly G-rated, family-friendly entertainment that appealed to viewers of all ages, from children to the elderly.
Monday's 8:00 p.m. slot saw the second episode of Survivor peak at 25.65 million viewers, virtually locking up the title of the fall season's top-rated show. The only real drawback was its mere thirteen-episode run.
Sandwiched into Wednesday's schedule, Big Brother and The Real Housewives of Beverly Hills faced little direct competition and saw steady gains.
Finally, the game-show-style reality program CBS had initially tried to produce independently of Daenerys premiered that week to a respectable 13.6 million viewers. While not a breakout, the numbers only deepened the regret of the other three networks, which had approached reality television with far greater caution.
It was clear that in the coming years the major networks would pour substantial resources into developing their own exclusive reality formats. Should any of those become a breakout hit, Daenerys would struggle to maintain its current leverage and profit margins.
Simon, however, was not overly concerned. In his memory, reality television had evolved over two decades, yet only a handful of shows ever reached true phenomenon status. The vast gap between the ratings of the once-massive Millionaire and Survivor and those of Big Brother and The Real Housewives proved that creating a blockbuster was far from easy.
After two days of weekend edits followed by careful adjustments during the workweek, Daenerys resubmitted a revised version of Scream to the MPAA ratings board.
It was now late September. The company had originally planned a Halloween release on October 28 and had already invested heavily in early promotion. Yet the delays caused by the re-rating process meant no formal distribution deals had been signed with North American theater chains. Seeing the situation deteriorate, Simon quietly began preparing alternative plans.
Santa Monica.
In a conference room at Daenerys Effects, it was Wednesday, September 28.
Simon stood at the presentation board, personally walking the group through the scripts for two animated features: Toy Story and The Lion King.
Seated around the table were several Daenerys Effects executives, including Mark Hilvis, as well as Ed Catmull and John Lasseter, the two former Pixar executives who had just joined the company.
Following his conversation with Steve Jobs on the flight to Australia, James Rebold, Amy Pascal, and others had spent the past month finalizing the acquisition of Pixar. It was now complete.
Daenerys Entertainment paid $20 million for Pixar's entire software and hardware division. Jobs and the original employee shareholders relinquished their stakes, and Daenerys acquired full ownership of the RenderMan suite and related software, instantly filling a critical gap in its CG rendering capabilities.
With the deal closed, Simon's first directive was to relocate the entire Pixar operation to Los Angeles.
Ed Catmull, John Lasseter, and most of the staff agreed, though a few inevitably declined.
Alvy Ray Smith, one of Pixar's original technical pillars, left the company over the move. When Simon's efforts to retain him failed, he let him go. 3D animated features were a cornerstone of Daenerys's plans for the coming years; to maintain direct control, Simon had no intention of keeping Pixar in San Francisco as had happened in the original timeline.
He had initially considered renaming it Daenerys Animation, but Catmull, Lasseter, and others preferred to keep the Pixar name. Since it was unimportant, Simon agreed.
The purpose of the meeting was to discuss the technical details of porting RenderMan and other Pixar software to Silicon Graphics workstations, as well as the production timelines for the two 3D features.
Pixar had originally been positioned as a high-end graphics workstation manufacturer, but its hardware lagged far behind Silicon Graphics; its edge lay solely in software like RenderMan. To maximize integration of Pixar's tools with Daenerys Effects' existing pipeline, Simon planned to abandon Pixar hardware development entirely, allowing the studio to focus on software and animation.
Pixar computers had never reached a viable commercial product and had generated no profit—otherwise they would not have become a burden to Jobs. Catmull and the others raised no objection to discontinuing hardware R&D.
After Simon finished presenting the scripts, Ed Catmull spoke up. "Simon, Toy Story is technically feasible with our current tools. The Lion King, however—if we want truly lifelike animal movement, fur, and other details, the technology simply isn't there yet."
"That's your job," Simon replied, looking directly at Catmull before sweeping his gaze across the room. "I don't know much about the technical side, but I do know today's hardware is more than capable of supporting what I want. Think of the hardware platform as the canvas. Your task is to develop the brushes—the software that achieves the effects. And we certainly won't lack for animators. I expect only the results I've described."
Mark Hilvis added, "Simon, this will take a very long time."
"Don't say 'a very long time,'" Simon countered. "Tell me exactly how long."
Hilvis conferred briefly with Catmull, then looked up. "To develop the necessary technology for The Lion King and complete effect testing, with the current combined R&D teams from Daenerys Effects and Pixar at least two years, assuming ample funding."
"No problem," Simon said readily. Two years was far shorter than he had anticipated. "You may hire additional staff as needed, but keep it moderate. A company grows too large too quickly in its early stages, and problems arise. I will guarantee your budget. In return, deliver the results I want."
He turned to John Lasseter. "John, any issues on your end?"
The Toy Story script had been refined over multiple phone calls between Simon and Lasseter in the past month. Confident, Lasseter replied, "I'll need three years."
The lengthy production cycle of 3D animation was well known. In the original timeline, Pixar's two-year release cadence relied on multiple teams working in parallel.
From script to finished film, a single animated feature typically required three to four years or more. Throwing more animators at the problem rarely helped; with crews numbering in the hundreds, differences in individual skill and style became pronounced and could compromise quality.
"In that case, we'll end the meeting here," Simon declared. To Hilvis he added, "How's the Batman cape effect coming along?"
When concept art for Batman was first drawn, Simon had realized the cape posed a major problem. A real fabric cape would look ridiculous during Bruce Wayne's rooftop acrobatics. He had tasked Daenerys Effects with exploring a fully CG solution.
Hilvis smiled. "We just finished a three-second test of Batman falling from a height with the cape billowing open. The result is stunning. We were planning to show you today anyway."
As everyone rose and began chatting on their way to view the test footage, Simon's assistant Jennifer took a call and approached him quietly. "Ms. Pascal says the R-rating for Scream has been rejected again."
Simon stopped and gestured for the others to go ahead. "Are the materials ready?"
Jennifer nodded.
"Then set up a meeting with MPAA chairman Jack Valenti tonight if possible, or tomorrow at lunch. I need to speak with him."
The Motion Picture Association of America (MPAA) was fundamentally a trade organization, founded in 1922 to lobby on film-related legislation, protect copyrights, and establish content guidelines on behalf of Hollywood's major studios.
Membership was not fixed.
Originally comprising the eight major studios, the MPAA had added rising second-tier companies like Orion Pictures and De Laurentiis Entertainment in recent years. After several of those folded, the current core membership consisted of the traditional Big Seven plus Orion.
In 1966 the association hired Jack Valenti, a former aide to President Lyndon Johnson, as chairman. The forceful politician had held the post for twenty-two years and showed no signs of leaving.
Valenti's greatest achievement was abolishing the infamous Hays Code and introducing the "voluntary" rating system. Over time, however, films that did not submit to rating found it nearly impossible to secure theatrical or home-video distribution in North America.
Simon met the sixty-seven-year-old Jack Valenti the following day at noon in Burbank, in the Valley. The MPAA offices were located near the intersection of the 101 and Ventura freeways, close to several major studio headquarters.
The appointment was for 12:00. Simon arrived fifteen minutes early; Valenti walked in precisely on time.
"Simon, I've been looking forward to meeting you. The miracles you've pulled off these past two years are astonishing."
Simon shook hands with the stern-faced but highly articulate elder and politely invited him to sit. "Thank you, Jack. I deeply admire everything you've done for Hollywood over the years."
They exchanged pleasantries, sat, and ordered simple lunches.
Once the waiter left, Valenti noticed the open folder in front of Simon. Though he knew exactly why the young man had requested the meeting, curiosity got the better of him. "Simon, what were you reading?"
"Recent North American box-office reports," Simon replied, sliding the folder across. "The summer season ended September 9. From September 9 to 15, weekly domestic gross fell to $29.88 million. The following week, September 16 to 22, it was $25.67 million. This week's final numbers come out tomorrow, but based on the weekend, September 23 to 29 should be around $27 million. Last year, by contrast, only one week all year dipped below $30 million."
Valenti glanced at the report and sighed. "The strike's impact on the industry has been devastating."
Simon nodded. "I looked at October's release slate. If Daenerys's Scream cannot open as planned on October 28, the entire month will have only five films opening on more than five hundred screens. Last October there were nine—nearly half as many again."
Valenti had not expected Simon to dive straight into Scream. After a moment's consideration, he said, "Simon, the ratings board is rigorous and impartial. Your film likely needs further changes."
"Is it really impartial?" Simon countered, pointing to the folder now in front of Valenti. "Jack, beneath the box-office report are two memos. One details the board's notes on Basic Instinct, specifying cuts as precise as trimming a single shot by two seconds. The other is the feedback on Scream—vague demands to revise entire sequences, some over ten minutes long. Is that fair?"
Valenti had noticed the additional pages. He flipped them open, scanned briefly, and gave a wry smile. "Simon, you must understand, coming to me won't help. I don't control these decisions."
For twenty-two years Valenti had been chairman, and he commanded genuine respect in the industry. Yet at root he remained an employee of the major studios. Had his actions not consistently served their interests, he would not have lasted.
Thus he lacked the power to override the majors' desire to put a rising challenger like Daenerys in its place.
"Of course I understand," Simon said sympathetically. "Jack, I only need you to pass a message to certain people."
Valenti gestured for him to continue.
Simon glanced again at the folder. "Domestic box office has fallen below $30 million for three straight weeks, and I expect the trend to continue. The entire year-end slate will suffer contraction all because of the writers' strike. Jack, do you know why the writers struck?"