CHRIS NEUMER: I was doing some research on you over the last couple of days and kept coming across different interviews where you seemed amused by your Hollywood insider/expert label. You kept telling people that you weren’t quite sure if you knew anything and often cited William Goldman’s quote that nobody knows anything. I thought, "This is the first expert I've come across who keeps telling people that he doesn’t know anything." I was trying to figure out whether that made your advice better or worse.

PETER GUBER: I think the real–the value behind that comment is that nobody really knows as certainty. Certainty is an illusion. You don’t really know anything with certainty, but you can sort of intuit things by combining your experience and your exposure and your intellect and your education and your relationships to make something of it. Or you advise others, or your company, to act on it. Certainty is an illusion. What you’re always trying to deal with is coalescing the resources with a resourcefulness to come up with an intelligent guess on what’s going to be. It isn’t 'being' yet; it’s in the future. If you ask me, "What do you know about last month?", I can tell you with a high degree of accuracy. The past is history, the future is a mystery. Anybody who tells you that they know what the future holds is deluding themselves. There’s an ever-changing solution to every problem. If you think about it, that issue has accelerated or exacerbated in the last few years. What’s happened is: change has always been a part of human culture, the delta the line, was relatively flat for 10,000 years and in the last couple of hundred of years it’s angled up. But in the last ten years, what’s really happened isn’t just change, but the rate of change has changed, which makes it a more challenging situation to try and gauge what the future will be and how to interface it with your business or your creative enterprises. You tell me, starting a movie, that you have an idea for a movie that’s going to be made for a year and a half and you tell me that you know what the landscape and attitude of the public is going to be and what technology will interface, what competitor is going to be out there. You tell me what’s going to go on in the world that is going to affect it. Nobody knows. If something tells you that they know, they don’t really know. They’re making a calculated guess based upon a lot of facts, a lot of information. So when I say that nobody knows, that doesn’t mean that you don’t have resources to draw upon, or resourcefulness, it just means that you shouldn’t let your hubris get to close. To get too much of you.

PETER GUBER: First of all, I have a philosophy: be curious, not critical.

PETER GUBER: About everything. To ponder. If I’m going to do something, the key is not the answers, but to ask high quality questions. Continuing to ask high quality questions reveals the alchemy of the process, reveals the elements that are involved and allows you to cast a much wider net. You bring much more unconventional voices and thoughts and information into the equation and hopefully make a more purposeful decision. The challenge of trying to decide what to do now that will have an impact in the future, whether you’re talking about movies or television or any type of entertainment, there are so many forces upon the story the song, the product, the experience that the only thing you can do is deal with the predictable elements, because what you’re really doing is saying to yourself, I need to make sure that in the equation I have built in probability and possibility. One of the things about entertainment is that, if it’s risk averse, it usually fails. You have to embrace risk in a different way because creativity and risk are bound together. So you have to have a philosophy that deals with the metrics of the business–you know, how the business physically works–but you have to have that and that’s probability and you have to have the possibility, that’s the creativity, baked in with more than equally measure, because if you could predict which shows were going to work, you’d only make fucking hits.

PETER GUBER: You know, you can drag them into the theater, you can get the early viewers, the avids who are either turned on by the elements of the project, the stars or the nature of the property, if it’s a big book or a stage show, or the directors, or maybe even the nature of the concept. Ultimately, after that initial burst of early adopters, which comes in through marketing–which we call sampling–then it always viral. When I grab your leg and tell you, that’s the worst piece of crap I’ve ever seen in my life. You’re thinking, do I want to spend two hours of my life going to that movie? Do I want to invite someone else to it? So what happens is that, very quickly the tongue catches up to the feet. The people aren’t going to it and they’re talking bad about it. So, what you have is the marketing is critical in getting the attention.

PETER GUBER: Intention comes from the viral marketing of the people who see it in the first wave and sample it and begin to create a buzz about it. So marketing is a critical element to give the project momentum and to give it a visibility and frame the words that go in the mouth of the people who see it. But at the end of the day, after all the fancy marketing has been done and all the great celebrated people who are up there and the stars on screen you know what you have up on screen? The story. And if the story doesn’t work, all the ones and zeros of the digital revolution–unless those ones and zeros turn to oohs and aahs, you’re screwed.

PETER GUBER: Films are a constant compromise. Almost every element of every film is some compromise. You’ll see compromises in all films. The average MPAA film costs $77 million today, maybe more. It costs $35-$40 million to bring it into the domestic marketplace–that’s prints and advertising. That’s a $100 million investment for the average film. To say you’re going to make compromises–you’re going to compromise from the beginning. You don’t get exactly the type of male lead you want or female lead you want, the script needs some more work, the filmmaker really wants to do it in the winter, you want it for the summer. Everything in this collaboration that takes an average of two to three years and $100 million in a marketplace with a competing dynamic there are constant compromises and no certainty. The reality is that decisions are made for the craft as well as the art of making a film. The business of show business. The studio needs a summer film. They need tent pole stars in the summer picture. They need to show their schedule as robust. There are a lot of forces at work when you are trying to put together 16-18 pictures at an average rate of $75 million a picture and have one come out every three weeks globally. You have to be a Bulgarian juggler and you have to be twelve of them. They have to land on each other perfectly for everything to work. I don’t know anybody, ANYBODY, anybody, anybody that has the formula for continued success. And anybody that has done it and been successful who doesn’t marvel at how they even got it done… forget it was successful. Given that universal view, my answer to you is: compromises are part of the collaborative process.

PETER GUBER: the only compromise you try not to make–really, really, really, really, really, really, that’s 20 reallys, try not to make is the compromise about the script. If the script isn’t good, isn’t solid, you have a different job convincing the actors and the studio and the marketing people… what’s up on the screen is the script! You talk about two thousand lines of resolution being important for a movie, no! Two thousand lines of script are important! So, you show me a great script and an okay actor and an okay director, I’ll show you a hit. You show me a crappy script, one that is uninvolved, unimaginative and uninteresting and big stars and big directors, I’ll show you a flop. I’ve made both, I know. So the answer is the script is the blueprint for the movie. Now you don’t shoot the script, shooting the script is you standing the script up on the table and taking pictures of it. The script is the blueprint. From there comes imagination, comes serendipity, comes inspiration and comes collaboration. The script is the architectural blue print or template for the movie and if you start out with one that is blurred or indecisive, incomplete or inaccurate…

PETER GUBER: It’s only going to get worse.

PETER GUBER: What happens is that if the actor or director has committed to the project and they’ve promised that the script will be finished and be better. Then the script doesn’t evolve (and there’s a lot of money involved) and there’s a date for the movie to come out in the summer and it’s a big picture and people feel, "Well, it’s got enough action or excitement in it that we can get it right in the shooting and edit it correctly." People take chances. And, here’s the irony of this business, sometimes–that is an absolute rule, the script counts for everything–but there are no rules in this business, but you break them at your peril. So the irony of that rule is that you break that rule, make a hit and think, "Okay, that’s not a rule anymore." So you do it the other way and get kicked in the butt. The answer is that nobody knows for sure, but if you asked me what is the best navigational stake to drive in the ground for doing a movie or show or creative project, I would say, "The script, the song the melody, it’s that seminal element that is the foundation."

PETER GUBER: The interesting area is that there is no pink elephant in the room with us. The reason why the show is successful is not because I’m such a good chatter or good conversationalist–

PETER GUBER: Yeah, I started with no experience and I don’t consider myself an expert in that area and I don’t consider Bart an expert in that area. But, here’s why I think it works: the magic sauce is this. When I sit across from George Clooney–pretty formidable piece of man power–or any single person, I have either (I have made 70 pictures, overseen 1,000 and run three of the largest companies in the business, I’ve been in the movie business for 35 years, I’ve written books about, I speak all over the world). I can sit across the table from George Clooney because I just produced a picture with him and because I knew him early in his career and because I am a producer and financier, so I cannot just ask the first question, I can ask the third and fourth questions too. The first question can be designed by any good research person, it’s when they answer the question and you really know where you’re going because you have first hand experience. So what happens is that we have a conversation with them. We’ve traveled the same road and are on the same road as them. I’m at the center of my game right now making movies and television and sports. I can stand toe-to-toe with these guys whether its Clint Eastwood–made a movie with him–whether it’s Annette Bening. Virtually every person on the show I’ve done a movie with or worked with ‘em or know their agent or know them now. It gives me and Bart an opportunity to have a conversation with them. The idea of saying to George, "You shot this in black and white, did you shoot it in color and print it in black and white so you can release it in color later?" No, no. What were you looking for? Was it cheaper? No, it was more expensive. Was it more creative? Yes, I could integrate the real documentary footage with it more cleverly. Once I add color, it would have taken the audience in and out of the story. So it offers us the change to really talk about things.

PETER GUBER: I do. When we have Danny DeVito. He said, "You’re the one we made the deal with at the company." We talked about it and where he was going. George Clooney talked about the fact that I couldn’t get Barbet Schroeder to hire him when he was doing Desperate Measures–a film that he wanted Michael Keaton for–I disclose all that. The idea of the show is that it’s a conversation, not an interview. If you were sitting at the Coffee Bean and I was sitting across from Bob Zemeckis and you heard us talking and I said, "Bob, when you did the motion-capture for this thing, motion-capture’s been around for 15 years, what made it so different?" And we talked like that? "Why would an actor want to play an animated character of himself?" you’d be wanting to listen to both sides of the conversation. So here’s what happens: when I have a conversation with these focus–I had Terry Semel on the show this last week, the chairman and CEO of Yahoo, he was also the chairman and CEO of Warner Brothers–I made Batman with him and The Witches of Eastwick, some good, some bad but a lot of great ones. I asked him difficult questions. You didn’t know a thing about technology when you went to Yahoo and he shot back saying, "You didn’t know a thing about sports when you got into it, why’d they invest in your sports company?" What it is is a pitch catch pitch conversation.

PETER GUBER: I’m NOT a reporter. I was to be interested and interesting, a reporter or a journalist on TV has only to be interested, not interesting because what he’s doing is he’s forcing the other person to be interesting, if he’s good. I have to be smart enough to be interesting and engaged. When Bart goes off saying something ridiculous, as he always does, that was printed three times–first it was printed in The East Los Angeles Journal for Pediatric Toes then it was picked up by The Hollywood Reporter and then by The New York Times and he cited The New York Times! The original source is wrong and I get crazy with him, so the point is, we talk about these things. He comes from a journalistic intellectual background like yourself, I come from a visceral rock and roll background with often–I don’t know the reason for it–but I know the why for it. Why it happened not the reason for it. He has the reason for it, but he doesn’t know the why… the emotional part of it. So we engage each other from different perspectives. He comes very much from his head, I come from my gut. I mean this appropriately, these are good–this is a good question because it pokes at the differences between the show and… I’m making this up… David Sheehan asking Clint Eastwood why did you make so and so? When I talk to Clint Eastwood I made a movie with him, I ran a studio with him, I CAST him in pictures, I’ve had meetings with him. So I can say, "Explain to me the difference when you’re acting in a picture and you’re directing the picture and how you focus on the other actors. I noticed that when you’re doing this in the picture in In the Line of Fire you did your role and went to your trailer and the other guy read to a reader. When you were directing the picture, you read both sides of the picture, why is that?" No one would pick up on that. I’m just making that up though, you know what I mean?

PETER GUBER: Your questions poke at why I’m interested in doing the show and why it’s successful and why it’s interesting. People who are really interested in the show are really interested in movies and show business, they want to know not just why a movie was made but how come it was made and sometimes frighteningly why it was made.

PETER GUBER: You’re grasping it by both its horns and wringing its head. The question is though are you looking at the full picture. Just what you described does happen. Waterworld is an example of that. I remember that everyone said that Hook wouldn’t make money. Remember that? $300 million it made for the company, but here’s what the issue is. You have to take this respectfully, I’m trying to be respectful.

PETER GUBER: Here’s the issue, it’s called managing expectations. These movies and movie companies are lightening rods. When you spend $100 million or $200 million making a movie you become–you lead with the chin. It’s a big risk and everybody writes about it. There’s a lot of noise. There’s a $30 million advertising campaign to support it. What happens is–and I’ve done this–when you do this with movies and you’re the big picture you’re leading with your chin and you have to manage expectations. When you’re making Superman for $290 million, you have to manage that expectation.

PETER GUBER: New Superman. I made Midnight Express for a million seven hundred thousand dollars, all right? Superman a quarter of a billion–with a B–dollars just to make it. And I understand that King Kong was like $190 million. So here’s the question, when you do these monumental undertakings, you lead with your chin. Nobody’s sitting around talking about some $9 million movie that only did $14 million. Nobody writes about it. So Studios have to manage the expectations of the media and the public upfront because if they don’t, the metrics of whether they succeed or fail get played out in a different way.

PETER GUBER: It’s not a failure in the model of the business. An ordinary person would think, "Well, it cost two fifty and another fifty to market it and it only did a hundred sixty in domestic market box office, it’s a flop. No. It’s a giant hit!

PETER GUBER: I think the contradiction is this: everybody is managing different sets of expectations. The revenue, if you look at the revenue–Ten years ago, if you looked at, think of it as an iceberg, the top is on the surface and 90% of it is underwater, if you looked at that in the past, you could predict that the theatrical box office represented the highest part of the revenue from the food chain of the business. Today, the theatrical motion picture revenue is not the biggest part of the process. Cable and DVD sales represent a larger portion of the pie. But what happens is the story gets written long before that. The story is: The picture opens to X, Y, Z. It’s a flop. You don’t even get to the other things. Things aren’t measured the same way in the public media. Yes, in the more thoughtful examination of a financial periodical, like The Wall Street Journal, they’re clearly looking at the overall financial result of pictures are. But that story gets written later, the pop story, the news story the magazine story gets written at the front end. Terrible year of this company. You really don’t often know what that means and so while we are all aware that the admissions to the movie business have gone down the last 3-4 years–that’s the number of people putting butts in seats, not total revenue because revenue, ticket costs have gone up and there’s been other revenues by the movies–the number of admissions have gone down. On the face of it, it looks like the business has a declining profile. Is that true? Yes it is true in the theatrical market. So, oh my God, all the articles are being written saying that the movie industry is a bust, it’s over and through. It’s old entertainment. Let me give you a different way to read it. More people are seeing more movies in this world, more often than ever before in history. Some aren’t seeing them legally, some aren’t seeing them in theaters, some people are seeing them on cable and video and on TV, so the spirit of watching movies and the desire for us, all of us you, me, we’re wired to tell each other stories, not the last ten years of digital technology, but the last 10,000 years, we want to watch each other’s stories, that’s the way it works. But the business model that supports that is changing. And the denial of that is the problem. The record business denied that change and they had their lunch eaten. The question is: will the movie business make the same mistake. They were on the road to ruin with it for a while, but maybe they won’t make the same mistakes, maybe they’ll learn from the lessons and be more adaptive. These are some of the thoughts that I hope are useful to you.