Made In Hollywood

In early February 1998, the Academy of Motion Picture Arts and Sciences held its Oscar nominees' luncheon at the Regent Beverly Wilshire Hotel. As most media outlets and industry insiders predicted, Titanic became the biggest winner.

Even though Miramax, which had tasted Oscar glory last year, entered the race with a double insurance policy in Good Will Hunting and Life Is Beautiful, all of this was overshadowed by Titanic's unprecedented box office figures. Moreover, this was not a purely fictional film, so the conservative Academy voters couldn't ignore it. The film received a total of 14 Oscar nominations.

When an epic film based on true historical events sails into the Oscars with over $1 billion in global box office revenue, even the staunchest conservatives have to bow their heads.

Indeed, by early February, Titanic's North American box office had reached $462.15 million, with a global total of $1.062 billion, firmly cementing its position as the highest-grossing film in history!

The 14 Oscar nominations added even more fuel to Titanic's momentum. Over the weekend, its North American box office saw a sharp uptick, with a staggering 79% increase! Moreover, many countries initially reluctant to introduce Titanic were now eyeing this massive production—such as some nations across the Pacific.

The film's merchandise development also surged in full force, riding the wave of Oscar nominations.

Postcards, T-shirts, kaleidoscopes, pencil cases, tote bags, and figurines of Jack and Rose were among the products licensed in early February, generating $70 million in licensing revenue in the North American market alone.

Adding to this were the original soundtracks, which had dominated the Billboard album sales charts for nine consecutive weeks, selling 6.43 million copies. After deducting labor, distribution, and other costs, the film's North American ancillary earnings had already reached $120 million!

After more than two months of screening and promotion, Titanic had its first revenue split. Twentieth Century Fox, always strapped for cash flow, was far more eager and proactive than Duke in urging Paramount Pictures, Titanic's North American distributor, for the box office revenue split.

Following the Oscars nominees' luncheon, the North American theater alliance conducted two rounds of box office splits with Paramount Pictures, totaling $400 million. Due to the distributor-favored terms of the initial revenue-sharing agreement, Paramount Pictures took $224 million.

After deducting $40 million for North American distribution fees (10% of the film's gross) and the promotional expenses already incurred by Paramount Pictures and Twentieth Century Fox, the remaining amount available for the three primary investors was still $160 million.

Since the three parties had a clear agreement and professional firms from both sides participated in the film's distribution and promotion, the revenue and division percentages were transparent. Duke, who invested $50 million and held a 25% stake, received $40 million in revenue.

Although this was pre-tax income, he had already recouped most of his investment solely through North America's initial box office split.

Meanwhile, North American ancillary earnings were recorded under the studio established specifically for the film. After the first split of $120 million, Duke received $30 million as his share.

After two and a half months of Titanic's release, the investors, including Duke, had successfully silenced doubters with solid data. The ship many had mocked as "destined to sink" had already brought considerable profits to the three investors!

Furthermore, the $70 million in pre-tax revenue was just a portion of the profits. In modern Hollywood, overseas earnings often exceed domestic revenues, and when the overseas box office profits are eventually settled, the numbers are bound to astonish many.

Let's not forget that a film like Titanic isn't just about ticket sales. Although its merchandise may not match Jurassic Park, it remains a significant contributor.

However, Duke knew that recovering the overseas earnings would take time.

In the month following Christmas, Duke was busy during weekdays with the post-production of The Matrix and flew to New Zealand on weekends to oversee the pre-production of The Lord of the Rings trilogy. Despite his strong will, stamina, and robust health, he gradually began to feel exhausted, as though he were being split in two.

"I finally understand why even Spielberg, Hollywood's most famous quick-shot director, only managed to produce two films in a single year once—and Schindler's List took him ten years to prepare."

Sitting at a table in the editing room, Duke casually chatted with Tina Fey. With post-production now reduced to special effects work, assistant directors Zack Snyder and Anna Prinz had already left for New Zealand to join the pre-production of The Lord of the Rings.

Only Duke, Mike Dawson, and his assistants remained in the Duke Studio editing room.

"You should give yourself a break," Tina Fey said as she handed Duke a cup of strong coffee. "You haven't had a proper rest since Christmas."

"Are you tired too?" Duke asked.

If Duke didn't rest, his personal assistant Tina Fey couldn't either.

Tina Fey didn't deny it. "If it had been a few years ago, I would have been crying in my room by now."

"I'll take a break once I finish the trailer for this film," Duke said, acknowledging his fatigue.

Since the expansion of Duke Studio, there were more matters to handle. After Christmas, Duke hired a senior executive from his mother's connections, someone with Hollywood experience, to manage the studio's administrative tasks. However, major decisions still needed to be funneled through Tina Fey and ultimately approved by Duke.

Warner Bros. had also stationed senior executives at the studio following the share exchange agreement, which was inevitable. These seasoned professionals brought valuable expertise as long as proper oversight was maintained.

Currently, Duke and Warner Bros. were enjoying a honeymoon phase, with their interests closely aligned. While minor conflicts existed, they were kept under tight control.

By the end of an entire afternoon, Duke, Mike Dawson, and the Industrial Light & Magic team had added the final touches to the trailer's special effects. The 30-second ad, set to air during the Super Bowl halftime show, was finally complete.

"Tina..."

As they left the studio in the car, Duke asked his assistant, seated in the front passenger seat, "I'll take a few days off next week. Would you rather take your own vacation or join me at the Super Bowl?"

Tina Fey thought for a moment and replied, "I'll join you at the Super Bowl. If there's an emergency, I don't want to rush back from my vacation spot."

With The Matrix slated for a summer release, Duke Studio and Warner Bros. weren't going to miss the Super Bowl halftime show as a promotional platform. Ever since Duke's The Rock saw a box office boost after advertising during the Super Bowl, more films had targeted the event, making it a traditional promotional ground for Hollywood blockbusters.

In fact, the marketing for The Matrix had begun under Warner Bros.' direction long ago. Like any blockbuster, its promotion relied on various strategies. With Duke preoccupied with two films, he contributed little to the marketing apart from participating in interviews or Warner-sponsored promotional events.

However, there was one exception: given the film's frequent references to computers and networks—and with the internet thriving in 1998—Duke wasn't about to overlook this influential platform among youth.

Advertisements for the film appeared on high-traffic websites like Yahoo. Following Duke's suggestion, they also hired ghostwriters to stir discussions on film forums, successfully drawing attention from the online community.

Additionally, Duke commissioned Panny Kallis to develop a personal website. Once completed, it was linked to various film forums. Its main content? Promoting The Matrix.

...

Under dim lighting, Allen sat at his computer, exited the "Explosive Maniac" chatroom, and habitually clicked on a linked site from the forum. A peculiar website appeared.

The site featured a dark, somber theme with scrolling green text resembling program codes. Despite its simplicity, it prominently displayed a message board and an even more prominent image of a man wearing black sunglasses and a black trench coat.

Allen, a seasoned film buff, instantly recognized the man—famed for his destructive tendencies—Duke Rosenberg, nicknamed the "Explosive Maniac" and "Destructive Duke."

This image depicted the director in a never-before-seen guise: undeniably cool!

The picture showed him holding an evil-looking mechanical squid in his right hand and a black pistol in his left. Instead of bullets, the gun's muzzle emitted an enigmatic message:

"Is this world real? Do you believe what you see, smell, and hear is reality? The true world looks like this!"

This phrase was clearly a link. Allen clicked on it, revealing numerous images. Some depicted machines cultivating fields—not with crops but with something entirely different…

At the center was an eye-catching image with a stark caption:

"Stop being confused. The Matrix is deceiving you. Follow Duke and uncover the world's truth. You are the only savior!"

Curious, Allen clicked on another link, which led to unsettling images: ominous skies shrouded in dark clouds, Manhattan reduced to a blackened wasteland, and countless humans lying asleep in mysterious capsules…

What kind of world was this?

Despite having visited the site numerous times, Allen remained intrigued. What was "The Matrix"? Who was this "only savior"?

Of course, very few people are completely clueless. Allen quickly deduced that this must be related to Duke's new film. The combination of the film's cool aesthetic, tranquil life scenes, and apocalyptic imagery filled him with anticipation.