[Chapter 742: Family Interests]
After dinner, the two of them didn't rush to leave the restaurant. They ordered two cups of coffee, and Eric began talking about establishing a branch of Digital Domain in Australia.
"Isn't Digital Domain's annual revenue close to a billion dollars now?" Elisabeth asked, a hint of envy in her voice.
Eric nodded and replied, "Yeah, but since most of our work comes from Firefly's internal orders, the profit margin isn't high -- only about 10%."
To prevent talented visual effects artists from leaving Digital Domain, Eric offered them very generous salaries and bonuses, ensuring a very low turnover rate despite the industry's high demand for skilled professionals. However, the higher labor costs significantly diminished Digital Domain's overall profitability. Still, Eric never expected this effects company to bring in substantial profits for Firefly; its main role was to support the productions of Firefly's films and maintain Firefly's strong position in the effects field.
Elisabeth understood some key points, saying, "Last month, the Fortune 500 list showed that even the smallest company had revenues of $2.2 billion. Given the current high demand in the special effects industry, if Digital Domain continues to expand, it could easily go public in the future and join that list. Why are you setting up a branch in Australia? Sure, there are some incentives, but being far from Hollywood makes many things inconvenient."
"You can definitely see that there are more and more special effects companies in Hollywood now. So, the biggest factor limiting the development of special effects companies in the future won't be technology, but cost. I'm just preparing ahead," Eric explained.
Elisabeth nodded slowly, stirring her coffee with a spoon, and after a moment, she said, "I haven't been back to Australia much in recent years, so I'm not really familiar with the situation there. If you want to contact the Australian government, you should talk to my dad about it."
"Your dad is sharp as a tack; I don't want to deal with him."
Elisabeth raised an eyebrow and said, "Are you implying that I'm easier to deceive?"
"Well," Eric acknowledged, nodding seriously while joking, "but your comprehension skills aren't bad."
Elisabeth threatened to wave her spoon at him and then set it down. "Even if I wanted to, I really wouldn't be able to help you. My dad has started training Lachlan and James to handle the newspaper business. Our family's interests in Australia mostly involve print media, and I can't really get involved there."
Although News Corp's newspapers were spread all over the globe, Australia was the heart of the company, controlling over 70% of the country's media resources -- much higher than the 40% share in the UK. Eric knew full well the impending decline of print media, but Murdoch clearly didn't share that view, as he continued to treat print media as the foundation of News Corp.
From Elisabeth's brief comments, Eric could sense that Murdoch still preferred to groom his sons for the family business; otherwise, he wouldn't have put them in charge of News Corp's core operations while only giving Elisabeth responsibility for the film side of things.
At that time, News Corp made over 50% of its profits from print media due to its extensive newspaper holdings worldwide. Additionally, there were some television stations in Australia, East Asia, and the UK. Although Fox had been performing well in recent years, within the broader News Corp framework, it wasn't the most crucial segment. However, if this trend continued, things would get interesting in the future.
From what he remembered, News Corp had undergone a split over a decade later, separating into a print-focused News Corp and a Fox Group that primarily dealt with film, TV, and other businesses. At that time, due to the decline of print media, the new News Corp had a market valuation of just over $2 billion, a mere 2% of Fox Group's valuation of over $80 billion.
As long as Elisabeth could secure control of Fox, it would essentially mean inheriting the entire News Corp. Just thinking about it made Eric smirk.
"What are you thinking about, grinning like that?" Elisabeth's voice brought him back to reality.
"Oh, nothing," Eric quickly shook his head and said, "I think, since your dad has arranged it this way, you should just focus on running things at Fox. You really don't need to worry about the Digital Domain branch; I'll discuss it with him personally."
Elisabeth squinted at Eric for a moment before pouting. "I have a feeling you're up to no good."
"Liz, you have to trust me -- I'm always on your side."
"Is this 'you' singular or plural?"
Eric replied without hesitation, "Singular."
Elisabeth smiled but said playfully, "Yeah, right. Good luck getting me to believe that."
Having decided to let Elisabeth focus on Fox, Eric dropped the subject of the Digital Domain branch. After finishing their coffee, he glanced at his watch and said, "It's still early. How about I take you to catch a movie?"
"Oh..." Elisabeth drawled in a slightly dissatisfied tone, "How many times have you asked me to go to the movies?"
"Is this my first time? I guess I need to pick a good one. How about Independence Day?"
"No way! I want to see Liar Liar!"
"What a great girl! Even for a movie, you're thinking of your own family's film," Eric commented, handing his credit card to the waiter while complimenting her.
Elisabeth lifted her chin proudly, "Of course, not like you at all."
...
In the days that followed, Eric personally communicated with Murdoch about the relevant matters. Murdoch was more than willing to help but still requested that News Corp would take a stake in Digital Domain's Australian branch.
Without hesitation, Eric agreed to give News Corp 30% of the branch's shares. Under Murdoch's guidance, Stan Winston quickly brought the management team to Australia to negotiate with the local government. The Australian government was well aware of the benefits of having a major special effects company settle in their country, so they showed considerable enthusiasm. With the Murdoch family's backing in negotiations, they quickly offered a ten-year tax exemption plan.
Additionally, to attract more films to shoot there, the Australian government provided a $7.5 million cash subsidy for the upcoming filming of The Matrix, which was about 10% of the film's budget.
Hollywood reciprocated, announcing that after The Matrix, the special effects for the Lord of the Rings series would also be completely handled by Digital Domain's Australian branch.
...
While all of this was happening, another earth-shattering event unfolded in America in August.
On August 24, Microsoft officially launched Windows 95 at its headquarters in Seattle. With its superior user experience and extensive marketing campaign, Windows 95 sold 1.4 million copies in its first week. Unlike the free Yahoo browser, Windows 95 was priced at $210, a cost that would still not be considered cheap twenty years later. Therefore, with the first-week sales generating nearly $300 million for Microsoft, the company's stock price surged again.
Due to the increasing obsolescence of Apple's operating system and a lack of significant innovation over the years, compounded by recent issues with their new PC line, Apple had faced a dismal sales performance post-Windows 95 launch. As Windows 95 soared to popularity, Apple's sales plummeted significantly.
Eric also received an invitation to the Windows 95 launch event, but he opted not to join the fray in Seattle.
After all, even though Windows 95 was a hit, Bill Gates was not in a particularly good mood.
In subsequent weeks of research, it became evident that the most popular software on the Windows 95 operating system was the latest version of the Yahoo Browser that had launched concurrently. Following this, the next most popular item was Yahoo's YCR chat tool, with Microsoft's own software suite lagging behind.
While Windows 95 made using computers easier for the average person, a thought gnawed at Bill Gates: he was helping others to succeed. The capital market was similarly attuned to these changes, as Microsoft's stock skyrocketed, while Wall Street's highest valuation for Yahoo soared to $6 billion, leading many investment firms to seek partnerships with Yahoo.
Encouraged by this, Microsoft hurriedly launched its MSN portal site a week after Windows 95's release, which was modeled closely on the Yahoo portal layout, marking their entrance into the internet sector.
While Jeff Locke had handled some research work for Yahoo in its early days, he had since focused on website operations. Given the time constraints, it was clear that MSN would be nothing more than a facade; in terms of content and user experience, it simply couldn't compete with Yahoo's portal.
After browsing MSN's portal interface a few times, Eric felt no need for concern; even after years of development, it probably wouldn't catch up, especially since Yahoo was also progressing rapidly.
...
As September rolled in, the summer box office season came to a close. While major film studios managed to regain some market share in the tail-end of the summer season due to the absence of new releases from Firefly and MGM, for the entire 14-week summer season, Firefly and MGM still captured more than 50% of the market share.
The studio that performed the worst that summer was Sony-Columbia, which lost the distribution rights to Forrest Gump and Night at the Museum. Sony hastily purchased a few films as fillers, but these movies generally had box-office returns of only $10 to $20 million, with the highest grossing just $31 million. Overall, Sony Pictures' total box office take for the summer barely reached $100 million.
Warner's summer box office share was decent thanks to Batman Forever, but due to high production costs, Warner's film division faced more significant losses than several competitors in Hollywood.
Aside from Firefly and MGM, Universal and Fox were the only studios that performed well. Paramount had intended to release a new Tom Cruise film during the summer, but after considering the barrage of blockbusters, it postponed the release to the new year, resulting in a lukewarm performance that was just slightly better than Sony's.
...
While Firefly headquarters celebrated the impressive box office performance of the past summer season, Eric was on his way back to New York.
Entering September, the summer season had ended while the fall TV lineup was beginning. Production for America's Next Top Model and Project Runway was wrapping up, and Cindy Crawford and Linda Evangelista had even temporarily stepped away from these projects to prepare for the new year's Victoria's Secret Fashion Show.
Eric's trip to New York wasn't just to keep an eye on these two reality shows; he was also looking for a brief respite.
In East Hampton, the September weather had turned quite cool. Eric lazily sat on the estate's lawn, flipping through a script while Joanna sat quietly beside him, peeling an apple.
After a while, she offered him the peeled apple. Eric took a bite but didn't take it from her hand.
Joanna giggled and asked, "How's the script?"
"There are a few areas that need improvement, but overall, I'm quite satisfied," Eric replied while flipping to another page.
Joanna observed, "You seem pretty invested in this script lately. Are you excited about it?"
Eric raised his eyebrows and nodded, "Yeah, it's about time for me to start my next film, and the main reason is that I really enjoy this script."
The script in Eric's hands was the one he and MGM's writing team had been developing for the James Bond film, Casino Royale.
The original Casino Royale was set in a timeline post-2010.
Though it was the first installment from Ian Fleming's original work, aside from the scenes in the casino, the storyline had little to do with Fleming's narrative.
The plot revolved around a massive sum of money involving various chases, fights, and explosions, but it also introduced the first woman who captured Bond's heart. This character, named Vesper, became a crucial component for the success of the Bond franchise's later installments.
In fact, several subsequent sequels referenced the character who was Bond's first love.
Eric was particularly fond of this character, so while substantial changes were made to the story for the spy film universe, the character of Vesper remained intact.
What Eric was considering now was who would play Vesper. He remembered that Eva Green, who would later take on this role, was just a fifteen-year-old girl at the time, and the unique traits of cleverness, stubbornness, gloom, and mystery that characterized the role would be challenging to find a suitable replacement for. At that moment, Eric couldn't think of anyone in Hollywood fitting that description.
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