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LOS ANGELES (TheWrap.com) ? What's wrong with the movie business?
It's a question worth asking after a year in which DVD sales continued to decline, domestic attendance fell to its lowest level since 1992 and critics are griping that this has been one of the worst periods for movies in recent memory.
At the dawn of 2012, TheWrap asked six industry experts what the future holds for Hollywood and what, if anything, can prevent the business from being a casualty of the digital revolution taking place around it.
Wall Street expert Harold Vogel, analyst and author Edward Jay Epstein, producers Mike Medavoy and David Hoberman, critic Joe Morgenstern and director Gavin O'Connor all weighed in with a range of observations, from a pessimistic "there is no cure" to an optimistic view of burgeoning creativity among young artists.
Here's a look at the film landscape from people who've seen the ups and downs of Hollywood over the years. (Interviews by Brent Lang, with assistance from Fred Schruers and Sharon Waxman.)
Mike Medavoy, chairman and CEO of Phoenix Pictures:
"The numbers are not that surprising. It's been a long time coming, and the economy worldwide is certainly not helpful.
"In the past new technology like television, videotape, DVD and cable have saved the film industry. Well, what's next? If anything, the American movie industry is the best there is, but it too can wear out its welcome. Special effects alone won't save it.
"The cost of marketing and producing, the decline of DVD, pirating and the need for outside partners for high risk and cost films which lowers your upside, makes all the choices of pictures to make more difficult.
"The decision to rely on remakes and sequels at higher costs either makes people feel that they have seen a movie and can either wait and see it on the after-market or miss it all together.
"Fresh and different helps in the long and short term.
"It finally comes down to picking the right films and at the right cost -- not by bankers, but by a combination of people who love movies and know talent, story, and character weighing in with business people and with the marketing people. Finally it's a gut call."
Joe Morgenstern, film critic for "The Wall Street Journal"
"Anybody who loves movies has to be honest with themselves and worry whether this is not a cyclical thing, but a downward spiral.
"There's been a dismaying spectacle of studio ineptitude. "Bridesmaids" was the one studio film that emerged from the meat grinder unflawed and that was only because Judd Apatow had the power to protect it.
"It was a raggedy film and not everything worked, but I'll take raggedy over expected any day. It was complex, funny, raunchy, and all of those elements were done with zest and conviction.
"One obvious lesson is that high end technology can have a toxic effect on films. When I look at "Hugo" or "Tintin," I think of what these guys would have done without hundreds of millions of dollars, and I think in both cases they would have made better movies. There was an absence of simple human feeling that is indispensable to a good film, even though the displays of technology are awesome.
"The one upside this year is that more independent films are going online, which means that there is a democratization of distribution. But just like with newspapers, it's not clear that there's going to be enough online money to pay for these films."
Harold Vogel, head of Vogel Capital Management and author of "Entertainment Industry Economics: A Guide for Financial Analysis":
"The business will never be the same again.
"It's not cyclical. This is a technological shift on a generational scale, and the long-term technology is distribution on the web -- and that's not ten years, that's forever.
"The DVD lived for about eight or ten years and was magnificent while it lasted, but it was an interim technology. But the longterm technology is all digital distribution on the web -- streaming or downloading or whatever.
"The studios feel vulnerable, but the film industry lucked out too. Their product requires five gigabytes or more of data to be downloaded and it doesn't happen that fast on the current Internet, but that will change. Slow speeds gave the business a couple of years to figure things out. It's been a buffer.
"The business kind of imploded about three years ago -- films became seen as something you could never get a return on, so the studios went to these bets of $100 million-plus. That seemed to do well for awhile, but if you look at the margins of the industry for basically the last forty or fifty years, we have not broken out of this eight to ten percent pre-tax margin range. Margins have been basically flat and are probably headed down.
"There is no great cure for this. There are some problems in life for which there's no cure. The studios are going to be around, but their ability to generate high margins and sustained margins is being challenged all the time.
"Eventually the business will settle into accommodation with the digital universe and studios will make money out of it. But that doesn't mean the business is going to go back to the old way, because the old way doesn't exist anymore. We're coming into a time of slow economic growth around the world and this is going to last a minimum of three or four years and more likely for another ten years."
Gavin O'Connor, director of "Warrior":
"There's a consumer market unlike anything we've ever experienced. It can consume content in myriad ways and that needs to be acknowledged. Much as I'd like to be an artist and plow my own field and not worry about accessing consumers, I've learned you can't do that anymore.
"A lot of people are scratching their heads on the artistic side and the business side. What doesn't change is original voices and great stories and daring visions -- these things will never change. But you have to understand the market and how much a move should cost.
"I try to be an optimist. What's exciting is that there are so many new ways to find revenue. I believe that there's an on-demand revolution going on where you have companies like Netflix moving in and gobbling up market share, so if you can put your finger of the pulse of this change and engage on alternative platforms, there's lots of new ways to touch the consumer.
"Do I wish I was alive and making films in the late '60s and '70s? Yeah. I'm an old soul that way, but you have to evolve with the way the revolution is evolving. Now there's a chance for artists to band together and create a new model.
"I'm doing a little movie that I'm going to shoot for a hundred thousand. At the same time, I'm writing big studio scripts and I'm doing a play.
"It's about being entrepreneurial and creating content that I care about and that I think people will respond to. You can't wait around for studios to send you scripts anymore. You have to write movies outside the studio system, take them around and maybe you have someone attached to it before you find the right home."
Edward Jay Epstein, author of "The Hollywood Economist":
"The main challenge to the film industry is the death of video stores. It's not a threat to movies like "Spider-Man," but to a movie like "Tinker, Tailor, Soldier, Spy." It's the kind of small movie where people have to find out about it by going into the store and speaking to a clerk. It might not get into a Redbox or a Walmart. Their disappearance is a major challenge for smaller and more diverse productions.
"The decline of the DVD is being masked by the still strong sales of DVDs to children and it's hiding the real slide in sales of smaller movies.
"That's limiting the guaranteed income for a lot of productions. It will be harder to guarantee money to make a movie as the way people watch movies changes. The entire nature of a film's availability is changing as people watch things on tablets and smart phones and people aren't buying digital copies the way studios want.
"One way the studios are improving their profits is by lowering their above-the-line costs. They can't really cut their below-the-line costs. But through digital production, they're able to lower their printing costs.
"There are two things the industry can do. It can make the technology of theaters more appealing and studios can change the mix of the pictures that are in theaters. They know how to do that and it's been going on since "Jaws." But making a movie like "Avatar" or "Titanic," which becomes an event, is much harder to do."
David Hoberman, producer and partner in Mandeville Films and Television:
"This year there wasn't the big launch of some new franchise or a big new piece of business that gets people excited about the movies.
"It felt like people were not compelled to go to the theaters. From Thanksgiving to Christmas, it just felt like a lackluster holiday season and I'm not sure what that's about.
"I think that there were good movies out there, so I'm not sure that a facet of this was that the movies weren't good. There were movies like "Hugo" and "Tintin" that were inventive and terrific movies, but they didn't drive people to the marketplace.
"It's like a television network. One hit show drives a programming slate and makes a whole network. What's that big event movie that people go out to and gets them excited about going to see more movies?
"I teach at UCLA and I do a teaching fellowship of Suffolk University in Boston, and over the last few years, the films I've seen from my students are amazing. The energy and inventiveness of what some of these kids are doing makes me think there's going to be a whole new wave in live action and animation.
"There's so much fermenting at the university level that I think there's going to be tons of opportunities, as these kids from this last generation are growing up. They're going to be the Steve Jobs of the world, figuring out new ways of creating things."
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Geraint
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NEW YORK ? An off-duty federal law enforcement agent who died while confronting a pharmacy robber was picking up his elderly father's cancer medication, a New York congressman said Sunday.
Veteran agent John Capano had chased down the suspect inside the store and was trying to subdue him on the ground when he died, said Rep. Peter King, R-N.Y. The robber, who was also shot to death, was identified Sunday by police as 43-year-old James McGoey of Hampton Bays.
"John was with him on the ground wrestling," said King, who has spoken with local authorities and Capano's family. "Next thing you know, shots are fired."
McGoey went into Charlie's Family Pharmacy in Seaford, a small shorefront Long Island town, at about 2 p.m. on New Year's Eve, police said. He announced a holdup and was given what he came for: painkillers and money.
Capano, a trained explosives expert who had served in Iraq and Afghanistan, confronted McGoey as he tried to leave the store. Meanwhile, an off-duty NYPD officer and a retired Nassau County police officer who happened to be at a deli next door were alerted that someone was trying to rob the pharmacy, King said.
"This is a horrible confluence of events," King said. "They both hear this guy saying there's a robbery going on. They get their guns, they go next door."
It's not clear who shot either man. Capano, 51, died of a gunshot wound at a hospital. He was a 23-year veteran of the Bureau of Alcohol, Tobacco, Firearms and Explosives who taught U.S. military and local forces in Afghanistan and Iraq how to investigate blasts, said Rory O'Connor, assistant special agent in charge in the ATF's New York office.
"He was a veteran agent who did his job well," O'Connor said. "Even though off-duty, he felt the need to take action in an attempt to protect the public."
Capano lived in nearby Massapequa and was married with two children. His father, Jimmy Capano, was a retired NYPD detective and the "unofficial mayor" of Merrick Road, the main thoroughfare in town and the street where his son was killed, King said.
"Everybody in Seaford knows the Capanos," said King, who has lived in the town for 40 years. "They're good, solid people."
On Saturday night, King spent half an hour with Jimmy Capano, who is 82 and was about to run out of his cancer medication.
"He was going to walk down to the pharmacy," King said. "And someone said, `Hey, John will pick them up for you.'"
King did not know what type of cancer Jimmy Capano is being treated for, but said his wife, Helen, died of breast cancer two weeks ago.
During a visit to the crime scene Sunday morning, King saw the elder Capano again: standing in front of the pharmacy where his son died.
"He was standing at the front window with his hands in his pockets, staring," King said. "He's very tough and very emotional at the same time. He was obviously still trying to figure out what happened. As a cop, he was trying to go through the timeline."
The area has been struggling with a growing tide of prescription drug abuse, said Razov Felice, owner of an Italian restaurant down the street.
"There is a lot of problem in Long Island with these drugs," Felice said. "I don't know what people are thinking. The more people talk about these drugs, the more people are trying them."
A message left at McGoey's Hampton Bays home wasn't immediately returned Sunday.
Armed robberies at pharmacies in the U.S. rose 81 percent between 2006 and 2010, from 380 to 686, according to the U.S. Drug Enforcement Administration. On Father's Day, four people were gunned down by a drug addict during a pharmacy robbery about 30 miles west of the one in Seaford where Capano was killed.
His death is the latest in a string of shootings of off-duty officers in the New York area who were responding to a crime.
In May, a New York Police Department officer shot to death an off-duty colleague who was carrying a gun while chasing a suspected car thief in East Harlem.
In March, an off-duty transit authority officer shot a Nassau County police officer who was in plainclothes and carrying a rifle while both men were responding to a crime in the town of Massapequa Park.
And in 2008, Westchester County police officers killed an off-duty officer from suburban Mount Vernon while he intervened in a fight.
___
Associated Press writers Chris Hawley, Cristian Salazar and David B. Caruso contributed to this report.
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MAIDUGURI, Nigeria (Reuters) ? Heavily armed troops and tanks patrolled the streets of Maiduguri in northeast Nigeria Sunday, witnesses said, after the president declared a state of emergency in parts of the north affected by an Islamist insurgency.
President Goodluck Jonathan imposed the state of emergency on the northeast, the conflict-prone central city of Jos, and part of Niger state near Abuja Saturday, and closed the borders with Cameroon, Chad and Niger in the northeast.
Nearly a week after the radical sect Boko Haram set off a series of bombs across Nigeria on Christmas Day, including one at a church that killed at least 37 people and wounded 57, Jonathan told state television his aim was to restore security in troubled parts of the north.
A Reuters reporter in Maiduguri, a remote city in the northeast and the center of the Boko Haram insurgency, saw several tanks patrolling the city and groups of a dozen or more soldiers at a time out on foot patrol.
"We woke up this morning only to see armed soldiers all over the place and some tanks patrolling. We fear what may happen next," said Maiduguri resident Buba Guduf.
Jonathan said he had told his chief of defense staff to take other "appropriate" measures, including setting up a special counter-terrorism force.
The blasts at churches have raised fears that Boko Haram, a movement styled on the Taliban, is trying to ignite sectarian strife in Nigeria, Africa's most populous nation and top oil producer.
Jonathan has been criticized by the opposition and Christian groups for what they said was a slow response to the bombings.
CLASHES FEARED
Residents of Maiduguri, located on the threshold of the Sahara Desert, have borne the brunt of previous clashes between Boko Haram, whose name means "Western education is forbidden," and security forces.
Friday three explosions struck Maiduguri shortly after Muslim prayers but caused no casualties, and gunmen shot dead three members of a Muslim cleric's family.
Gun battles between security forces and Boko Haram killed at least 68 people in two days of fighting in the nearby city of Damaturu on December 22 and 23.
"The soldiers have intensified their patrol in our area and most people prefer to remain indoors for fear of the unknown," Ibrahim Usman, from the Gwange ward of Maiduguri, told Reuters by telephone.
"We are just doing our normal duty," said an officer for the Joint Military Taskforce for Maiduguri, who could not be named because he was not authorized to speak.
The bomb attacks by Boko Haram have strained Nigeria's already fractious north-south divide.
Jonathan, a Christian from the south, upset many northerners by running for and winning the presidency in April, tearing up what many saw as a tacit deal to rotate the top job between a northerner and a southerner every two terms.
More than 500 people were killed in post-election violence in the north after Jonathan's victory, reflecting long-standing northern grievances about perceived alienation and exclusion by the government from the fruits of the oil wealth that is concentrated in the south.
Saturday, Jonathan visited the scene of the deadliest Christmas attack, on St. Theresa's Catholic church in Madalla, on the outskirts of Abuja.
"We will crush the terrorists," he told weeping relatives of the victims gathered in the church for a vigil.
In a separate, unrelated incident, clashes between rival ethnic groups in southeastern Ebonyi state Saturday killed at least 50 people, and police said mobile units had been sent there to quell the violence.
Those clashes are likely to add to Jonathan's woes at a time when his forces are already stretched.
(Reporting by a Maiduguri correspondent; Additional reporting by Anamesere Igboeroteonwu in Onitsha; Writing by Tim Cocks; Editing by Tim Pearce)
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Annie Devine
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ACAPULCO, Mexico - There are media reports in Mexico that two police officers accused of robbing a Canadian tourist in Acapulco have been fired.
The Mexican newspaper Universal quotes police director Miguel ?ngel Hern?ndez Albarr?n as saying the tourist filed a complaint that he was robbed on Wednesday.
The amount of money involved was 300 pesos, which works out to about 22 Canadian dollars.
Hern?ndez Albarran says the money was returned and the tourist has returned home -- it's not know where in Canada the person was from.
Universal also is reporting that six other public officials are under investigation for possible extortion.
Hern?ndez Albarr?n told the newspaper says members of the public are being urged to contact authorities if they are aware of any wrongdoing or have been victimized.
He says Mayor Manuel A?orve Ba?os has indicated he will not tolerate this kind of behaviour from any public official.
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