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BUSINESS Movie Film, at Death's Door, Gets a Reprieve Tarantino, Abrams Mount Campaign to Get Studios to Promise Orders From Kodak

By BEN FRITZ July 29, 2014 6:59 p.m. ET

Faced with the possible extinction of the material that made Hollywood famous, a coalition of studios is close to a deal to keep Eastman Kodak Co. in the business of producing movie film.

The negotiations—secret until now—are expected to result in an arrangement where studios promise to buy a set quantity of film for the next several years, even though most movies and television shows these days are shot on digital video. Kodak's new chief executive, Jeff Clarke, said the pact will allow his company to forestall the closure of its Rochester, N.Y., film manufacturing plant, a move that had been under serious consideration. Kodak's motion-picture film sales have plummeted 96% since 2006, from 12.4 billion linear feet to an estimated 449 million this year. With the exit of competitor Fujifilm Corp. last year, Kodak is the only major company left producing motion-picture film.

Mr. Clarke originally had hoped that a group of studios, producers and filmmakers would invest directly in Kodak's film-manufacturing plant, as a joint venture. But that proposal fell flat earlier this summer. A subsequent effort to solicit long-term orders from studios gained traction when several prominent filmmakers joined Kodak's cause, according to people involved in the discussions.

Among the big name directors who lobbied the heads of studios to help find a solution were Quentin Tarantino, Christopher Nolan, Judd Apatow, and J.J. Abrams, who is currently shooting "Star Wars Episode VII" on film.

Quentin Tarantino was one of several directors that lobbied heads of studios to help ensure the continued production of Kodak movie film. Mr. Tarantino is shown on the set of 'Inglourious Basterds,' in 2009. Weinstein Company/Everett Collection In the agreements being finalized with Kodak, studios are committing to purchase a certain amount of film without knowing how many, if any, of their movies will be shot on the medium over the next few years.

"It's a financial commitment, no doubt about it," said Bob Weinstein, co-chairman of Weinstein Co. "But I don't think we could look some of our filmmakers in the eyes if we didn't do it."

Mr. Weinstein said he was personally lobbied by Mr. Tarantino, a public critic of digital filmmaking.

Film and digital video both "are valid choices, but it would be a tragedy if suddenly directors didn't have the opportunity to shoot on film," said Mr. Apatow. director of comedies including "Knocked Up" and "The 40 Year-Old Virgin," speaking from the New York set of his coming movie "Trainwreck," which he is shooting on film. "There's a magic to the grain and the color quality that you get with film." From Reels to Pixels With preliminary order numbers in hand, Kodak is now negotiating formal commitments. Among the studios in talks Timeline highlights of film and digital film-making. with Kodak are Time Warner Inc. 's Warner Bros., Comcast 1889: Kodak produces the first commercial Corp.'s Universal Pictures, Viacom Inc. 's Paramount transparent film roll. 1895: The Lumiere Brothers publicly screen a Pictures and Walt Disney Co. 's Walt Disney Studios, as film for the first time ever. well as Weinstein. 1927: "The Jazz Singer" is the first "talkie," or motion picture with sound, to play publicly. "In an industry where we very rarely have unanimity, 1935: "Becky Sharp" is the first live-action everyone has rallied around keeping film as an option for the feature film made in Technicolor. The new technology would become broadly popular foreseeable future," said Warner Bros. CEO Kevin over the next few years with hits including Tsujihara. "The Wizard of Oz" and "Gone With the Wind." 1952: "Bwana Devil" is the first 3-D color Industry experts say the roughly $1 million cost of renting feature film, setting off a brief craze using the new technology. cameras and recording equipment on a movie is roughly the 1970: Imax big screen projection is shown same for film and digital, but that the latter allows for faster publicly for the first time, in Osaka, Japan. movement through the visual effects and post-production 1999: "Star Wars: Episode 1 - The Phantom Menace" is the first movie played on digital processes. projectors. 2002: "Star Wars: Episode II - Attack of the "I'm a huge fan of film, but it's so much more convenient Clones" is the first feature film shot entirely on digitally," said producer Ian Bryce, whose recent digital cameras. "Transformers: Age of Extinction" was shot primarily on 2008: "Journey to the Center of the Earth" is the first live-action feature film made and digital cameras. shown in digital 3-D. The next year, the technology moves into the mainstream with Kodak's Mr. Clarke was named chief executive in March, "Avatar." seven months after the company emerged from a 20-month 2013: "The Wolf of Wall Street" is the first movie distributed entirely digitally, with no film bankruptcy reorganization. He found that demand for film prints. from Hollywood was dropping even faster than Kodak had projected and that, as a result, that business unit would be unprofitable for the first time in recent history.

Film is expected to account for less than 10% of Kodak's approximately $2.2 billion of revenue this year, but a closure of the movie-film plant would be an outsized blow to the company's image as it attempts to regain lost luster.

Inside Kodak's Movie-Film Plant Kodak hopes the agreements will stabilize a rocky business and help to bridge a revenue gap for the next few years as it attempts to market a version of its film for use in touchscreens for devices like smartphones and tablets.

Although the company also makes film for aerial and industrial customers, the movie and TV industries have long been its biggest clients. But the digital revolution has sent their demand into a tailspin. Most movie theaters have switched over to digital projection.

Before several Hollywood studios promised to buy a "The unprecedented decline in the use of film in the set quantity of film, Kodak was considering closing its entertainment industry created an enormous amount of movie-film manufacturing plant in Rochester N.Y. Nick Brandreth for The Wall Street Journal uncertainty," Mr. Clarke said in an interview. "We had to build a coalition among all the parties in order to reach a solution."

Related Coverage It remains to be seen whether film will find enough adherents Q&A: J.J. Abrams Says Film Sets Standard to remain economically viable in the years to come, as few Christopher Nolan on Future of Films young directors still use it. Elizabeth Daley, dean of the school of cinematic arts at the University of Southern California, said only one class at her school, advanced cinematography, still trains students to use film.

But proponents have also pointed out that film is the only medium still used for preservation of all types of movies for long periods of time—even ones shot digitally. Digital files need to be regularly transferred, putting them at greater risk of being damaged.

Mr. Clarke said that he expects Kodak will lose money on film manufacturing in 2014 and roughly break even by next year, based on the deals currently being worked out. By 2016, he hopes that sales to touchscreen manufacturers combined with projected demand from Hollywood will move Kodak's film business back into the black.

"I am confident we will see a slowing of the [revenue] decline," said Mr. Clarke. "But a large part of this will be a deeper recognition that film is valuable."

Write to Ben Fritz at [email protected]

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