Really good read: http://www.nytimes.com/2005/06/10/b...l=0&adxnnlx=1118376654-H3Ik7m6Xzuq1ZwgQjWyQ2g
LOS ANGELES, June 9 - Hollywood does not like it when outsiders play certain games.
That was the message sent this week to Microsoft and its agents at the Creative Artists Agency by movie studios outraged at the aggressive proposal being shopped for the film version of the popular Xbox video game Halo.
Even studio executives, known for their lavish spending, winced at Microsoft's demands, including a $10 million upfront fee for rights, approval over the cast and director, and 60 first-class plane tickets for Microsoft representatives and their guests to the movie's premiere.
As a result, the auction Microsoft had hoped for never materialized. Within 24 hours of reading the script, based on the game about an alien universe, five studios dropped out of the bidding, including DreamWorks SKG and Paramount Pictures. The two that remained, 20th Century Fox and Universal Pictures, balked at the price.
But in the end, after intense negotiations, Microsoft and Creative Artists have negotiated a deal, although it is not yet final. The intense, high-stakes talks that got them there indicate just how big the video game business has grown - and how attuned to its power Hollywood studios have become.
The process began at about 11:30 a.m. on Monday when several actors dressed as the Master Chief, a green-helmeted warrior from Halo, walked into the lobbies of several Hollywood studios, scripts in hand. Microsoft had taken the unusual step of paying Alex Garland, the writer of the horror film "28 Days Later" and a Creative Artists client, about $1 million to write a script faithful to the Halo universe.
Studio executives were asked to read it while the Master Chiefs waited in the lobbies. At Paramount, one studio executive said, the Master Chief held his helmet in his lap because he was hot. When executives were finished reading, each studio was given a proposal with Microsoft's terms and 24 hours to respond.
Late Wednesday afternoon, two of the people involved said, Mr. Schlessel, Universal and Fox tentatively agreed to complex financial terms: Microsoft would be paid no more than $5 million for Halo, half the original asking price. That amount was part of a deal to give Microsoft 10 percent of the first-dollar box-office gross receipts, less than before but still considerable given Microsoft's lack of a track record. Universal, in turn, would oversee production and get domestic distribution rights, while Fox would get the foreign rights and have a say in production.
Both studios declined to comment on Thursday. That is because the deal is contingent on Microsoft's agreeing to give up some creative control, the two people said.
All sides are sure to claim victory once a deal is announced. Microsoft can tell fans it preserved the integrity of the Halo games; Creative Artists will try to demand even more money for its clients; and Fox and Universal will lay claim to a hot video game title and a potential future partner in Microsoft. The other studios, for their part, will have to decide whether to go along when other eager video game makers come calling.