Roth Takes Brave New Role as Entrepreneur

By CLAUDIA ELLER and JAMES BATES

Jan. 13, 2000 12 AM PT

TIMES STAFF WRITERS

Having officially resigned Wednesday as chairman of Walt Disney Studios, Joe Roth starts a new job next week: fund-raising for a new venture into independent movie making.

Roth leaves behind one of the most coveted, high-profile executive jobs in Hollywood, running the studio with the largest box-office share in the industry.

In his place will be Peter Schneider, a 15-year Disney veteran who has been instrumental in the company’s uccess in feature animation but has barely gotten his feet wet in the live-action business. He also has nowhere near Roth’s depth of experience or talent relationships.

While Schneider is considered a smart, creative executive, his autocratic and sometimes volatile style is viewed within Disney as a stark contrast with Roth’s low-key, even-tempered demeanor.

Schneider was on vacation in Mexico this week and unavailable to be interviewed about his new job.

Roth, 51, said that after working under the corporate restraints and financial pressures of a major publicly held media company such as Disney for the past 5 1/2 years he decided he’d be happier being an entrepreneur.

He acknowledged that while he is excited about the prospects that lie ahead, he is “scared to death” about not having a specific plan for the first time in his professional career.

“On Monday I’ll go to look for office space on the West Side and put a plan together for a multiple-picture business with good talent and see how the new media plays with all this,” said Roth, whose last day at the Burbank-based studio will be Friday.

Roth said his inspiration for taking the risk of breaking out on his own was Barry Diller, his former boss at 20th Century Fox who resigned to pursue uncertain entrepreneurial adventures at age 50.

Roth said he hopes to attract the kind of funding that will support a full-fledged movie production and domestic distribution company that can turn out five to 10 major films a year.

Roth said the time is ripe for forming an independently financed movie company given the changing economic environment in Hollywood and the changing role that movie divisions play in the ever-expanding universes of giant media companies.

With the cost of movies continuing to skyrocket, the major studios are increasingly looking to independent production entities to lay off as much of the financial risk as it can.

The past few years have seen a number of independent production financing outfits spring up as sort of satellites to the studios.

Many of those companies rely on the studios to distribute their movies domestically, but Roth hopes to control the release of his product in the United States much as Miramax Films and DreamWorks SKG do.

However, he says he does not want to incur the same kind of overhead costs weighing upon many of the independents that support multiple businesses, including television and music.

“I want to have a lean organization that focuses entirely on developing, producing and domestically distributing movies with strategic partners who have specific distribution needs,” said Roth, explaining that such partners might include an American pay TV service or an Internet company.

Roth said the phenomenal, surprise success of last year’s box-office hit “The Blair Witch Project,” which was largely marketed over the Internet, “really turned my head around.”

The film’s producers and distributor, Artisan Entertainment, “had the whole nation going to the movie without spending $25 million in TV advertising,” Roth noted. “It was the most radical thing I’ve seen in distribution since I’ve worked in Hollywood.”

Roth said controlling theatrical domestic distribution is “the best way to assure your identity.”

Roth said he is depending on such factors as “the emergence of DVD as a real player; the money involved in new media; the need of big European companies, particularly in TV, for content; and the risk-averse nature of the American studios.”

Former Universal Pictures Chairman Tom Pollock, who now runs his own production outfit with director Ivan Reitman, agrees that the opportunities for independents are greater today. “Independent companies have become even more important to the studios than before because they can rely on them for high quality, major product and use them as vehicles to offload risk.”

Pollock also suggested, “People who run the larger companies have so much to concentrate on, the creation of movies at the studios becomes less and less of a priority.”

Pollock characterized Roth’s resignation from Disney as “sad because he was one of the few studio heads left who really understands how films are made.”

Industry analysts say with Roth’s track record and relationships, he should have no trouble attracting capital for his new business venture.

“Wall Street has a great deal of respect for Joe,” said Jeffrey Logsdon of Seidler Cos. “There’s a lot of angel capital floating around the world today for someone like Joe.”

Logsdon added, “Coming out of the ultimate corporate environment, it seems he’d like the simplicity of being the captain of his own fate.”

Roth said after working for moguls Diller and Rupert Murdoch when he headed 20th Century Fox and Chief Executive Michael Eisner at Disney--”the longest of the long executive shadows” as he put it--he felt it was time to break loose on his own.

“I’ve never been able to get comfortable with the corporate rhythm. . . . There’s something about me that loves a blank page,” Roth said.

Eisner said that while he wishes Roth had stayed, “I don’t consider him a great loss to this company given the totally fabulous people we have. Would I like to have had him continue in this company? Absolutely. I liked having him down the hall.”

* MARCH OF THE CHAINED SOLDIERS

Executive exodus becoming familiar at Disney. A1

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Joe Roth

Personal:

* Born on June 13, 1948, in New York

* Married to Donna Roth, producer of “Benny & Joon” and “Unstrung Heroes.” Three children.

Education and early career:

* Studied communications at Boston University before settling in San Francisco, where he worked as a production assistant on commercials and feature films. Later he became a booker for United Artists.

Career highlights:

* 1976: Produced “Tunnelvision,” a film spoof about TV programming in which he also appeared. Later directed “Streets of Gold” and “Revenge of the Nerds II.” * 1987: Co-founded Morgan Creek production company, which was responsible for such films as “‘Young Guns,” “Major League” and “Dead Ringers.”

* 1989: Appointed chairman of Fox Film Corp. Oversaw such hits as “Home Alone,” “Edward Scissorhands,” “Hot Shots!,” “Sleeping With the Enemy,” “White Men Can’t Jump” and “The Last of the Mohicans.”

* 1992: Resigned from Fox to form Caravan Pictures with Roger Birnbaum at Disney. Productions included “The Three Musketeers” and “While You Were Sleeping.” * 1994: Appointed chairman of Walt Disney Motion Pictures, succeeding Jeffrey Katzenberg. Later promoted to chairman of Disney Studios and given oversight of movies, television, home video and animation.

Recent Disney box-office hits: “The Sixth Sense,” “Toy Story 2,” “The Water Boy,” “101 Dalmatians” (live action), “Ransom,” “Tarzan,” “Armaggedon,” “Enemy of the State.”

Recent Disney misses: “The Insider,” “Bicentennial Man,” “Beloved,” “Mumford,” “The 13th Warrior,” “Mystery, Alaska.”

Sources: Baseline II and Marquis Who’s Who