"This place is truly beautiful. Daenerys Studio is definitely the most unique film studio I have ever seen."
On the second-floor area of Daenerys Studio in Malibu, CNN reporter Dana Logan walked side by side with Amy Pascal through an open-plan office loft. Lights, cameras, and crew surrounded them as they recorded an interview segment.
Strolling along the wide corridor outside the workspace, Amy smiled. "Simon designed it himself. He said he drew inspiration from the old factory buildings in Manhattan's SoHo district where many artists gathered."
Dana Logan surveyed the busy staff in the open office area and nodded. "If I could work here, I would be willing to stay late every single day."
"We have always tried to create the most comfortable working environment possible for our employees," Amy said, then her expression grew slightly more serious. "However, I must state once again that Daenerys Entertainment has never forced any employee to work overtime."
Dana Logan did not shy away and pressed, "Then how do you explain the recent lawsuit filed by the three major unions using this as one of their reasons, Amy?"
Amy thought for a moment. "I believe it stems from the natural drive of a young company. Everyone is working hard so Daenerys Entertainment can grow faster and stronger. Moreover, it is not just the comfortable office environment here at the studio. The base salaries for Daenerys Entertainment employees are at least twenty percent higher than those at other companies in the same industry. Therefore, I feel the three unions' accusations and lawsuit against Daenerys Entertainment are completely unreasonable."
Dana Logan nodded slightly but immediately followed with a sharper question. "But Amy, how do you explain the cooperation memorandum Daenerys Entertainment just signed with Australia? If Daenerys Entertainment acquires MCA and its market share increases further, does that mean even more Hollywood jobs will be lost overseas?"
Amy did not answer directly. Instead she looked at Dana Logan and asked, "Dana, if you received an offer for a job with significantly higher pay and far better benefits, would you accept it?"
Dana Logan paused, then replied, "Probably yes."
"That is exactly the principle. Employees have the freedom to choose better opportunities, and companies likewise have the freedom to seek more favorable operating environments. When unions abuse their power and pressure companies too far, it is inevitable that companies will leave. It is not only Daenerys Entertainment. Over the past few years, due to various restrictions in California's film industry, many studios have been steadily moving productions overseas."
Dana Logan could not help saying, "I suddenly thought of Detroit."
"Indeed, Detroit's decline is truly regrettable, and the unions there bear a great deal of responsibility. It is similar to some Latin American countries. Their politicians, in order to win votes, keep promising ever-higher welfare benefits without regard for what the national economy can actually sustain. The result is economic collapse, and it is ordinary citizens who ultimately suffer the consequences."
"Amy, are you saying the three unions' lawsuit this time is an abuse of power?"
"As one of Hollywood's studios, we strictly adhere to the basic agreement frameworks of all the major unions. Even after acquiring MCA, this will not change. Every union member who works with Daenerys Entertainment will receive the proper salary, insurance, and full range of benefits, and in fact will enjoy even better treatment than they would at other studios. We have fulfilled every obligation we are supposed to meet. The three unions are still trying to block Daenerys Entertainment's acquisition of MCA. I find it difficult to imagine any reason other than abuse of power."
The interview recording took two hours, and Amy and Dana Logan's footsteps covered the entire Daenerys Studio.
Once the interview finally ended and the CNN team was escorted to rest, Pat Kingsley, who had been standing beside Amy the whole time as public-relations consultant, walked over, flipped through her notebook, and said, "There are quite a few topics involving Simon. They could distract the audience. I think we should cut all the early dialogue in the administrative area and start directly from the office-loft scenes."
Amy glanced at Kingsley's notes, considered for a moment, and nodded. "That's fine."
Kingsley continued, "Also, the remarks about Latin American countries are somewhat problematic. They could easily be twisted. Daenerys Entertainment has substantial business in Latin America. There is no need to provoke those governments."
Amy recalled the moment and asked, "Do we need to re-record that section?"
"No need. We can handle it in editing."
Kingsley shook her head and moved on to other points.
The two women discussed for more than ten minutes. Kingsley then went to speak with the CNN team about the editing plan, while Amy headed to a meeting in the administrative wing. The topic was Daenerys Entertainment's media strategy and counteroffensive surrounding the three unions' lawsuit, aimed at steering public opinion as much as possible in their favor.
After a brief return to Los Angeles following Thanksgiving, Simon had gone back to the East Coast and was now fully focused on advancing the Bell Atlantic acquisition.
The Bell Atlantic deal was proceeding far more smoothly than MCA. Simon intended to push it through in one decisive push. To that end, he had instructed Amy to stir up as much noise as possible in Hollywood's media circles, drawing more attention there to reduce any potential public backlash against Westeros Company's acquisition of Bell Atlantic.
Today's interview was only one part of Daenerys Entertainment's recent aggressive publicity campaign.
Amy's tight focus on the theme of the three unions "abusing their power" during the interview had also been a carefully considered media strategy. It allowed them to label the union leadership as a "bureaucratic institution" opposed to the interests of ordinary members, planting the subconscious impression that the union bosses were merely playing power games rather than genuinely fighting for their members' welfare. This created division within the unions themselves.
In reality, the three unions' lawsuit could not deliver any direct benefits to their members.
Moreover, it had to be admitted that thanks to salaries and benefits far above industry averages, plus far more opportunities for fame and advancement, Daenerys Entertainment had become the most sought-after studio in Hollywood in recent years. Entertainment professionals at every level strongly preferred to work with the company.
Although Daenerys Entertainment's recent memorandum with the Victorian government in Australia and its plan to build a film and television production base in Toronto had provoked some resentment among Hollywood workers, most people recognized that the move had largely been triggered by the three unions filing suit first. Daenerys Entertainment was simply responding in kind.
Unlike a typical strike, the three unions' lawsuit offered no immediate gains for their members yet had already caused countless people to lose job opportunities. Under Daenerys Entertainment's deliberate media campaign, the pressure on the three unions was easy to imagine.
Amy's interview aired on CNN the very next day, followed immediately by a Los Angeles Times investigative article detailing salary data for Daenerys Entertainment employees.
The three unions had accused Daenerys Entertainment's acquisition of MCA of creating a monopoly that would worsen working conditions for industry professionals. Yet the reality, whether through the far more comfortable and luxurious Daenerys Studio compared with other Hollywood lots or the clearly higher pay scales at Daenerys Entertainment, made those accusations difficult to sustain.
Burbank, Universal Studios.
When Screen Actors Guild president Barry Gordon arrived, Lew Wasserman had just finished watching the video of Amy's interview. His face was grim.
Barry Gordon's mood was no better, though he considered himself relatively lucky.
Two days earlier, The Hollywood Reporter had exposed a scandal involving George Kirgo, chairman of the Writers Guild of America West. A WGA member with Oscar voting rights for Best Screenplay had publicly testified that during the voting for Pulp Fiction, George Kirgo had personally called him and told him not to vote for Simon Westeros.
George Kirgo had immediately issued a firm denial and threatened to sue the writer for defamation.
Everyone in the industry knew the truth, however.
The story had not appeared out of nowhere. A wave of articles quickly followed, pointing out that since his debut Simon had produced outstanding works such as Run Lola Run, The Butterfly Effect, Final Destination, Pulp Fiction, and The Sixth Sense. As one of Hollywood's finest screenwriters, he had even earned recognition in technical categories like Best Editing and Best Original Score. Yet the Writers Guild had deliberately ignored him, giving him almost no nominations, let alone awards.
People in the circle all knew the root of the matter still lay in the 1988 strike. Daenerys Entertainment's writer-free reality shows had made that strike extremely awkward, forcing the WGA to compromise in the end. Under Daenerys Entertainment's orchestration, however, the incident had become fresh proof of Hollywood unions "abusing their power."
George Kirgo's term had begun in 1987 and was not due to end until the close of 1991.
Under the impact of The Hollywood Reporter's story, Kirgo might now be forced to resign early as chairman of the WGA West.
In truth, what frustrated the three unions most these days was Daenerys Entertainment's ability to control and guide media narratives.
Many observant people in the industry had noticed that Daenerys Entertainment paid far more attention to cultivating media relationships than other studios. What made it even more difficult to handle was that Simon Westeros was also extremely wealthy.
Just for the year-end slate, Daenerys Entertainment's marketing campaigns for its films were noticeably stronger than in previous years. It was said that Westeros had approved an additional twenty million dollars in marketing budget for several pictures. Even Westeros-owned companies such as Gucci, America Online, and Cisco had suddenly launched powerful new advertising pushes at the end of the year.
All of it meant massive advertising spending.
It was well known that North American mainstream media, whether television or print, relied primarily on advertising revenue.
Although Daenerys Entertainment's ad placements could not cover every type of media platform, the range of sectors it touched was broad enough.
On the other hand, North American mainstream media outlets were mostly structured as diversified media conglomerates, like Hearst and Newhouse with their hundreds of newspapers, weeklies, and magazines, or Capital Cities/ABC with its broadcast networks, cable channels, and radio stations.
Simply by placing advertisements with a portion of these media groups, Daenerys Entertainment could make them hesitant to bite the hand that fed them.
As a result, the three unions' recent attempts to counterattack in the media had achieved very little. Many articles rebutting Daenerys Entertainment's position had been blocked before they could even be published. This left the unions in a very passive position. Combined with Daenerys Entertainment's moves to shift production overseas, opposition to continuing the fight against the company had begun to surface not only among rank-and-file union members but even among those who had first attacked Daenerys Entertainment.
Ordinary people rarely understood the power of capital. Only those inside the situation were forced to acknowledge that a super-rich man with personal net worth exceeding twenty billion dollars, along with the rapidly forming business empire behind him, was not someone so easily provoked.
Barry Gordon accepted a cigar from Lew Wasserman. After the secretary served coffee and left, the two old men sat in the office smoking in heavy silence.
Lew Wasserman's situation these days was far from comfortable either.
Especially after Westeros Company suddenly announced the Bell Atlantic acquisition.
MCA's shareholders had not been in any particular hurry before. They had patiently waited for Lew Wasserman's management team to negotiate better terms on their behalf. The Bell Atlantic deal, however, had made many of them nervous. They worried that management's deliberate delays might cause the entire acquisition to collapse.
Or, even if the deal eventually went through, whether the final price might end up lower than Daenerys Entertainment's previous seven-billion-dollar offer.
After all, MCA's stock price had fallen steadily since the Bell Atlantic announcement.
Add in Panasonic's withdrawal and the interference from the three unions, and it was impossible to predict which direction things would take. With the shadow of the Gulf War already hanging over the world and the American economy in a weakened state, memories of the economic damage caused by the Vietnam War were still fresh. If this acquisition dragged on and war broke out while the stock market declined, MCA would only become more vulnerable.
These past few days Simon Westeros had clearly shifted his focus to the East Coast Bell Atlantic deal and had even stopped contacting MCA. Although he continued to clash fiercely with the three unions in the media, many people suspected he was deliberately stalling, waiting for the war to erupt.
From Misery at Halloween, to Dances with Wolves and A League of Their Own, Daenerys Entertainment had already delivered three solid hits in this year-end window. That was more than enough to show the company could continue thriving rapidly even without MCA.
MCA, on the other hand, lacked that kind of confidence.
To date, not a single Universal Pictures film released in 1990 had crossed the hundred-million-dollar mark at the North American box office. The best performer, Back to the Future Part III, had ended with just over eighty-seven million dollars domestically. Even the co-production Misery, while successful, had not reached that threshold either.
Therefore, Daenerys Entertainment's need for MCA was not nearly as urgent.
If Lew Wasserman's management team continued to stall and caused Simon Westeros to lose patience, the other side could walk away from the deal by paying a mere sixty million dollars in breakup fees. Sixty million, or even more, seemed to mean little to Simon Westeros.
As for Lew Wasserman himself, he had begun to waver.
The cards Michael Ovitz had passed to him had already shrunk far below what the agent had originally planned.
Paramount Communications, capable of directly confronting Daenerys Entertainment, had withdrawn. Meg Ryan, who could have sparked a major scandal, had withdrawn. Hollywood heavyweights like Dustin Hoffman and Tom Cruise, originally prepared to speak out publicly against the acquisition, had also backed down.
Now even the three major Hollywood unions, the most likely force to restrain Daenerys Entertainment, were retreating step by step under the recent media offensive.
Although he still held some trump cards, Lew Wasserman no longer had much confidence left.
If pushed too far, he was not even sure whether that young man would bypass the MCA board entirely and approach shareholders directly. He understood that Westeros had not done so only because he wanted to complete the acquisition of all MCA shares in one clean transaction through the standard process of board approval and shareholder vote.
Buying MCA shares directly from shareholders with cash might allow Simon Westeros to gain control easily, but acquiring every last share would become increasingly difficult the longer it dragged on. The shareholders who held out until the end would certainly demand higher and higher prices, forcing Westeros to pay more and more.
Even without buying shares directly from shareholders, Westeros could still call a special shareholder meeting and vote to remove the current board.
At that point Lew Wasserman would lose his greatest leverage.
Of course, the biggest downside of such a move was that the acquisition would become protracted.
Yet no matter how he looked at it, Lew Wasserman did not believe a few extra months of delay would harm Daenerys Entertainment. No one expected the American economy to rebound quickly after next year's war began. That would defy common sense.
After silently finishing a portion of his cigar, Barry Gordon spoke first. "Lew, we plan to reach a settlement with Daenerys Entertainment at the latest next week and withdraw the lawsuit."
Lew Wasserman could only smile bitterly in response.
It had always been a difficult case to win. Daenerys Entertainment was no longer a second- or third-tier studio that unions could push around. Other than settling as quickly as possible to prevent Daenerys Entertainment from taking further actions that threatened the unions' very foundation, the three unions truly had no better options.