Deal of the Century

By my count​ , of the 37 photographs of Michael Ovitz in this book there are 19 in which his mouth stays shut – while he’s smiling. That isn’t intended as a hostile remark. His mouth stayed closed when he smiled because he was concentrating. You may not have heard of him, but for maybe a decade and a half starting in the mid-1970s no one in the motion picture business was more focused than Michael Ovitz.

‘Mike’ from the San Fernando Valley was an incessant, soft-spoken maker of order and system, a godfather with no god other than success. No one was more prepared or implacable in negotiation. That closed smile was a lever with which to open a bottle, or a career. It stayed in place whether he was springing the deal of the century, or a cute trick on a Thursday afternoon. You can say all he cared about was the money – and he is generous in sprinkling these pages with price tags. But it’s just as true that he negotiated for the serene habit of victory, the way a poker-faced shark can’t stop moving or nibbling at moonlight skinny-dippers off the Massachusetts shore. What was his business? Largely movies, but it could have been rubber, half-inch screws or military takeovers. Sometimes, he took three hundred telephone calls a day.

There was a time in Hollywood when Ovitz was perceived as the awesome future already arrived: the incarnation of long-held fears concerning what talent agents might become. But it’s clear now that he was also the last of a dying breed (so many American movie pathfinders end up that way). That’s the reason for his book’s tight-lipped title. The man who was recognised, not to say feared, as the most effective operator in the motion picture business was at some point swept into the dustbin of ‘Whatever happened to … ?’

So who was he? Michael Ovitz was born in Chicago in 1946 to David, the son of Jewish Romanian immigrants. David was a liquor salesman for Seagram’s but he worked weekends too, selling patio furniture to support his family after they moved to Encino in the San Fernando Valley. ‘The most nondescript part of greater Los Angeles,’ Ovitz writes. ‘I loved Encino until I knew better, and then I hated it. We were on the wrong side of the hill from all the action.’ The Ovitzes reached Encino in 1951, the same year A Place in the Sun was released. Already, an urge was building in Mike to be the sun in the place. He seemed a mild guy, with that stilted smile, but he was ready for confrontation and he was fixed on the business of entertainment.

It’s nice to think that the movies have been about art sometimes – even an art for ‘everyone’. But this miracle so often required other people’s money, and lots of it. Just as the fantasies on screen inflamed the imaginations of dreamers in the dark, so money began to define the souls of picture people. It was and remains a perilous marvel that entities as ambitious and reckless as Metro Goldwyn Mayer, Fox, Netflix and Facebook could and can tap such springs of money and – in what was at first a cash business – that no one much bothers whether it’s legal or accounted for. Or remembers that art needs to be done for its own sake.

The audience made it clear from the beginning that a few pretty or gaudy creatures fed their dreams – Mary Pickford, Al Jolson, Rin Tin Tin – and, of course, those creatures had to be paid. Pickford took charge of her career in ways that soon added severity to her face. Jolson pushed Warner Bros up to $75,000 to do The Jazz Singer. It was said that Rinty was paid $1000 a week, but only his owner knew that. Most of the human performers were as innocent as the dog. The money, their bone, was prodigious compared to what they’d had as unknowns. But it was even so a mere fraction of the profits, and in those days actors got no residuals. Vivien Leigh, the actress who emerged from the search for a Scarlett O’Hara, was paid $25,000 in 1939 for Gone with the Wind. She got a small bonus as its success loomed – but no more. She died, in 1967, with the film still going strong. Its gross so far is close to $400 million, or $3.5 billion in today’s money.

Where the cameras set up, the agents were quick to follow. The studios put the talent under contracts amounting to well-paid servitude, and the agents guessed that the stars would be incapable of looking after themselves financially. So they levered their way in and started to ask for more – much more. The key figures were William Morris and Abe Lastfogel (who together formed the William Morris Agency), Phil Berg, Myron Selznick (who found Vivien Leigh for his brother David), Leland Hayward and, most significant, Lew Wasserman, Ovitz’s abiding model and, in the end, target.

Wasserman (1913-2002) was from Cleveland, with parents who had come out of Russia. He was a theatre usher and then a booking agent for the Music Corporation of America, originally set up in the 1920s by Jules Stein to organise the music business in Ohio. In the late 1930s, Wasserman took MCA into the film business and moved to Los Angeles. He started collecting top stars in an age when movie stars were growing old and going out of fashion. He told them to incorporate themselves and break away from studio contracts; the studios, faltering in the face of television, were no longer in a position to call all the shots. In 1950, for his client James Stewart, Wasserman made a deal with Universal in which humble, folksy Jimmy sacrificed an up-front $400,000 for two pictures (Harvey and Winchester ’73) in exchange for a share of the profits. The western alone made him $800,000 – at a low corporate rate of income tax. This was the start of ‘points’, or residuals, for actors. The change was logical and deserved, yet it helped destroy the hegemony of the studios.

As a kid, leading tours of the Universal lot, Ovitz encountered Wasserman and it felt like meeting royalty. There was much to learn. Wasserman’s rules were simple, as Ovitz tells it: ‘Tend to the client, dress appropriately, divulge no information about MCA, do your homework, never leave the office without returning every phone call. He insisted on dark suits, white shirts, and a dark blue or dark grey tie, and he’d sweep papers left on people’s desks into the wastebasket at the end of the day. His credo was “Messy desk, messy mind.”’ Thus Ovitz turned up for an interview at the William Morris Agency in 1968 looking like an FBI man. The boss there told the kid he’d have three years to learn the trade. Ovitz said if he couldn’t do it in 120 days he’d return his $55-a-week salary. The boss was impressed. ‘I was agenting him and he knew it.’ So Mike started in the mail room, which meant hand-delivery of scripts, contracts, cheques, gambling debts, death threats and floral tributes.

Ovitz was 22 at the time, so he got his education in Hollywood’s silver years: Bonnie and Clyde, Easy Rider, the breakthrough films of Altman, Rafelson, Bogdanovich, Spielberg and Scorsese, the two parts of The Godfather, American Graffiti, Chinatown and then Jaws. The weakness of the studios had forced them to take risks, and film-mad young men were allowed to make pictures that were often dark, tough and less than audience-friendly. You can regard that as a turning point for the good in American movie culture – but it wasn’t necessarily what a Mike Ovitz wanted.

The Morris Agency was efficient, but a little middle-aged and complacent. By 1973, a year in which Ovitz earned $2 million in commissions for the agency, he was on $400 a week and got a bonus of just $7500. He felt patronised and exploited. So he gathered a group of young insurgents who knew better and wanted to be their own masters. They were snarky, bitter and cocksure about the future: they were Corleones, deeply affected by the entourage swagger of The Godfather. Critics said the film was a rueful portrait of American capitalism. These guys used it as a style manual for playing the game.

So, in 1975 (the year of Jaws), with Bill Haber, Rowland Perkins, Mike Rosenfeld and Ron Meyer (a colleague Mike held as close as a brother), Ovitz left William Morris and formed CAA – the Creative Artists Agency. Their aim was to represent as much of the best talent they could get as soon as they could get it, and they went about it by making offers few could refuse. As a fond and slavish account of how CAA flourished, Ovitz’s book is more insightful about the American film industry than any biography we have had of Coppola, Scorsese or Spielberg. I don’t say that with a cinephile’s bitterness, merely in recognition that in the last quarter of the 20th century deals became more vital than pictures.

Ovitz claims credit for CAA in the making of movies – Ghostbusters, Tootsie, Rain Man, Shogun, Jurassic Park, Groundhog Day, Out of Africa – and careers. He delights in the manoeuvres he made to place David Letterman on late-night television at CBS when NBC proved determined to have the stolid Jay Leno succeed Johnny Carson at the Tonight Show. He rejoices in his friendships with Paul Newman, Dustin Hoffman, Barry Levinson and Sydney Pollack. He exults over the way CAA was able to bundle its actors, directors and writers together in single production deals. The agency became a studio.

CAA’s ascent was prodigious, in revenue and authority. When they started out, Ovitz and his colleagues had to enlist their wives to work the phones; by the mid-1990s, when CAA moved into a new building designed by I.M. Pei at the intersection of Wilshire and Santa Monica boulevards, it had more than five hundred employees. The firm had an aura of united purpose, a missionary zeal to own the town. It was a tough outfit, but fair: CAA was so successful that any trace of corruption in its dealings would have attracted a lot of bad publicity. Its deals were exact, thorough and effective. And they took the air out of the picture business, in part because it became apparent that Ovitz and his soldiers (it was a male citadel) never needed to see or think about the films themselves. Consider Ovitz’s blithe account of how he nudged Spielberg and Scorsese into ‘swapping projects’ so that Spielberg did Schindler’s List while Scorsese took on Cape Fear. It’s true that Spielberg hesitated before really going for the Holocaust story that would define his oeuvre and finally got him an Oscar. But it’s naive for Ovitz to believe he simply castled two jittery artists, relieving them of distress and setting them on the right course. Any great producer would have recognised that Spielberg and Scorsese needed those films as vehicles to exercise their passions and neuroses. These talents weren’t simply there to be handled by CAA, like pieces on a chessboard.

But it’s clear, reading Ovitz, that he wasn’t at all interested in watching movies, and that he even had some qualms about letting his mania for tidy perfection be squandered on mere agenting and 10 per centing. (In the LRB it should be stressed that CAA and all the other movie agents worked for just 10 per cent. It’s in the degraded and insecure world of literature that the virus of 15 per cent has taken hold.) Not that it was ever just the money. By 1995, Ovitz was restless:

I watched the runaway growth at Microsoft, where Bill Gates had built one of the world’s largest companies. Fortunes were beginning to be made off the internet. Executives I considered as my peers – Michael Eisner, Barry Diller – were raking in hundreds of millions in stock options. My appetite for corporate buccaneering grew as I worked with Herb Allen [a pioneer in corporate takeovers] and mingled with Fortune 50 CEOs in Sun Valley. It grew further whenever I lost an auction to an art collector with deeper resources. I wanted to play in that league, too.

And in truth I had always been faintly embarrassed to be an agent. As much as CAA had professionalised our field, it would never be a noble calling. I wanted to be one of the six people who could say yes to a movie without scrounging to assemble all the elements ahead of time. My master plan was to put in five years at a public company, then move on to a third act in public service and charity work. I dreamed of using my negotiating skills for the government.

There it is, the cat’s out of the bag, but it’s a triceratops. Not that the revelation need be sinister: I expect Ovitz would make a very conscientious president, reading reports, returning calls, making America dull again. Wouldn’t you vote for that? He was a dealmaker who reckoned he could organise and spread order in the world. He was rising above mere movie-making. He had become enraptured with Japanese culture, from décor and design to martial arts (at one time Steven Seagal was his personal trainer). That’s part of what made him agree to help facilitate the acquisition of MCA/Universal in 1990 by the Japanese company Matsushita. It was a large deal that didn’t work out well in the end, but it brought short-term prestige to Ovitz – as well as provoking more envy and hostility. The deal had another edge for Ovitz. Lew Wasserman, as the master at MCA/Universal, made a killing out of it, but at an emotional cost: he had been humbled by his display of dependence on the former tour guide at Universal. It was a scene of lost face and tight-lipped conquest: ‘Without a word, Lew and Sid [Sheinberg, president of MCA/Universal] turned their backs on me and walked the Japanese into the studio. I kept my face impassive, but I was hurt and upset, as Lew surely intended. I never spoke to Lew Wasserman again.’

Ovitz would play a similar role in Sony’s takeover of Columbia. He also finessed the advertising agency McCann Erickson in teaching Coca-Cola how to run its ads. He was collecting Jasper Johns. It isn’t that he was doing anything wrong, exactly, but being so right and cool and tight-lipped can be insufferable. Anyone with scriptwriting in their blood could foresee comeuppance.

Looking to make a move, Ovitz wondered if he might run MCA. When his bid hit problems, his dear friend Ron Meyer went to MCA in an effort to smooth them out, and came back with the news that he, Meyer, was going to take the MCA job himself. Intrigue like this recalls The Godfather’s conflicted feeling for respect and betrayal. Looking back, Ovitz sees that he had taken Meyer for granted (industry wisdom reckoned Meyer the most natural, charming agent in town). He had stinted on Ron’s money – and he had become too grand and important. In this world the man most respected is the dope waiting to be ousted.

His fall wasn’t far away. Impatient but uncertain how to become a Kissinger-type figure, Ovitz agreed a move to Disney, to stand beside Michael Eisner as joint number one, number one and a half, number two – or was he just a patsy? After a year, Eisner dumped Ovitz (there was a $130 million severance deal, disputed by shareholders, but sustained in court). Eventually Ovitz worked out that Eisner had lured him away from CAA only to break that agency’s power, in the spirit of pure rebuke.

Who Is Michael Ovitz? is no better written than an email from the boss to the guys. But that’s its proper and very readable style. We should guard against Ovitz’s calm vanity in interpreting all the deals. Some have seen the book as a grandiloquent and self-serving celebration of the way efficiency killed Hollywood, following decades in which the business had been lyrically unbusinesslike. But while there can be no doubt that Ovitz was a uniquely obsessed operative, if it hadn’t been him it would have been someone else. There was once an age when uneducated vulgarians who had escaped Europe made raw pictures that thrilled the world. But their business grew so large it became part of the conglomerated media industry. In the process, the vibrant mainstream picture – dreams for everyone – died, and expertise is part of what smothered it.

So let Michael Ovitz go and be president of something. He has been consulting here and there lately, especially in Silicon Valley. He’s only 72. Martial arts have kept him fit. He knows everyone, and he could make any enterprise hum. If he learned to smile properly he might be electable.