Sports Stars and Hollywood Celebs--Why America Loves Them All the Way to the Bank

If there were any doubts that the sports and entertainment businesses are becoming indistinguishable, look no farther than the now-legendary contract Shaquille O’Neal signed last month with the Lakers. The Schwarzenegger-ian hugeness of the deal--$120 million over seven years to the ubiquitous product endorser, movie-star-in-training, and, almost incidentally, star center and former Orlando Magic raison d’etre--must have seemed uncomfortably familiar to the entertainment conglomerates now running Hollywood. * The Shaq deal is merely the most humongous manifestation of a new reality transforming both Hollywood and professional sports: Talent rules. Want to fill your stadium, Mr. Team Owner? Want a boffo summer hit, Mr. Studio Chief? Fine. Fork over-- really fork over--for the talent. * In a marketplace crowded with new media ravenous for sports and entertainment programming, talent is now the currency of the realm. True, recent star-driven movies (think “The Cable Guy,” “Striptease”) foundered at the box office while special-effects monsters like “Twister” and “Independence Day” practically minted money. And there are rumblings that free agency is making millionaires out of mediocre players while decimating teams unwilling to pony up for superstars real or imagined. But longterm, the clout of talent is only expected to grow. * At the center of this art-of-the-deal maelstrom are the deal-makers themselves--the agents. We invited one each, from pro sports and Hollywood, to power-lunch on our tab and chew over the cross-pollination between their industries. * Sports attorney Leigh Steinberg, based in Newport Beach, has negotiated record-setting contracts for an array of NFL quarterbacks, including Troy Aikman, and just signed Olympic gymnast Kerri Strug. He’s also the inspiration (O synergy) for the movie “Jerry Maguire,” starring Tom Cruise, slated for release in December. Arnold Rifkin, agent to Bruce Willis and Sylvester Stallone, is head of the William Morris Agency’s resurgent motion picture department. MICHAEL WALKER, an editor at the magazine, moderated their conversation at Mortons over beverages sweetened with so many packets of Equal the waiter had to bring more.

BECAUSE, DOGGONE IT, PEOPLE LIKE ME

Leigh Steinberg (to Rifkin): Why is the public more angry about athletic salaries than they’re angry about movie star salaries?

Arnold Rifkin: I don’t know that they are.

LS: Every talk-radio show on sports, every indices of opinion we have indicate the fans are angry. And yet, no one’s angry because Tom Cruise will make $20 million for “Jerry Maguire,” or Sylvester Stallone, or Bruce Willis--I know you’ve negotiated for them.

AR: Maybe it isn’t demonstrated as much, because we don’t advertise what the salaries are. The top of the sports page, my little awareness of, says: “New contract for such and such a player, he will earn X dollars over the course of the next three or five years.” It’s really played up. Where there’s an effort to not play it up in our business.

LS: Except there’s an increasing awareness of the economics of star compensation in the entertainment and Hollywood world. In the old days, we didn’t see “Top Grossing Movies,” “Top 10 Videos.”

AR: (nods): It’s on your local news--the weekend box office is reviewed on Sundays.

LS: So obviously there’s a fascination somewhere because someone is reading this, and the public is responding. The problem in sports is that people think of it as a game: How can someone make that much money playing what, after all, is a fun game? I’m not sure how many people think they can act like Sylvester Stallone, but everybody thinks that they can play sports. If the median income in this country is $37,000, when an athlete is crying because he’s only getting a million six instead of a million eight a year, that strikes fans as totally insensitive.

AR: But look at the difference: When I negotiate for a movie, that’s a 10- or 12-week schedule, then it’s a year before you see it. And that’s it. Troy Aikman plays for a team where a whole bunch of people live and depend upon that he create his significance as quarterback so that team sustains championships. Now, the angst that they have when that player’s not performing well or the team isn’t doing well--and they have all this information prior about how much he’s earning--they begin to make a judgment about that person’s value, where I’m almost forgiven for films that don’t work when I have the one that works. Because that eliminates the memory bank.

LS: People attend sports events as an alternative to reality, a world that operates under its own rules with its own information, customs and traditions. To the extent that we force-feed fans an unremitting diet of contract hassles, large salaries, strikes and even worse, we risk destroying the fantasy element of sports and regurgitating the problems that people are coming to escape from. So, part of what’s key here is to try to minimize the financial focus; again, just as people are less angry about salaries for entertainers, they’re also very unfocused as to what a [team] owner might think, what his profitability is. But it all gets pushed down on the athlete. Sports fans also blame players for inflation in two senses: No. 1, if they see a direct impact on ticket prices; No. 2, they memorialize the days when Coke cost a nickel, to get into a ballpark cost a dollar and the top athletes made $100,000, and feel that something has gone awry. *

The flow of ancillary dollars--from television rights in sports to overseas box office and video sales in movies--is now crucial to the profitability of studios and sports organizations.

LS: In 1976, each team in the NFL received $2 million as its share of the national TV contract. The 1996 contract is $40 million per team per season just from national television revenue. In 1989, it was $17 million. So in the last seven years we’ve seen over a doubling of TV revenue. Our business depends on healthy owners able to make a healthy profit, and we have to make sure that happens. We’re fortunate in basketball and baseball, from an owner perspective, to have a salary cap, which means they have guaranteed profitability. If they were truly having economic problems, then we’d consider doing something else.

AR: So when you say they’re capped, then that provides a guarantee that the owner can project what he believes the athlete will draw? And yet he knows what his built-in costs are.

LS: Of the revenues that come into an NFL team, 63% is designated for the players; 37% for the owners. Now, the players are, in essence, no longer competing against the owner’s pocketbook, but against each other for their share of a legislated 63% pie. So that when

[Bengals running back Ki-Jana] Carter or one of these top draft picks gets an enormous contract, it’s coming at the expense of the other six draftees as opposed to overall.

This Is How We Do It

Both of you make your money by taking a percentage of your clients’ salaries. How much do you take?

LS: There’s a state labor regulatory commission that governs sports agents, but lawyers [Steinberg is an attorney] are exempt.

AR: So much for that.

LS: But the limits on compensation are set by the players associations themselves.

AR: But that’s a ceiling, right? So one can start with what would normally be considered the ceiling--

LS: Yes, and Arnold, in basketball the limit is 4% of the player’s contract, as the money comes in.

AR: And in football?

LS: Basketball and football are 4%; baseball 5%.

*

What’s the agent’s standard commission in the movie business?

AR: Ten. But because of the nature of our business, actors will often take on personal managers. So now they’ve got the cost of the agent, the lawyer, the personal manager and the financial advisor. So by the time an actor gets done, should they embrace a team of that many players, you’re looking at a potential of 35% off the top.

LS: How critical are every one of those to someone’s success? Does someone need to have an agent, and a personal manager, and a press agent and a financial planner?

AR: Oh, I left one out--that’s right, a press agent. That all depends on the individual, and the level of insecurity.

*

You’ve both negotiated hugely lucrative contracts for your clients. Share some tactics.

LS: My whole job in life, transactionally, is to avoid middle-age male ego from taking over smooth transactions. There’s an extremely short playing life for our players, and if they miss the window, miss a season, they’re missing perhaps 20% of their career. We’ve got male macho men in our field; I think the language of Hollywood is different, that in our world it’s male, macho, up front, in your face: I hate you, I don’t like you. I think in Hollywood, it’s [affects drippy insincerity) I love you. [To Rifkin] I’m not talking about you.

AR: Look, here’s the comparison: You perform in a world that has extraordinary violence, in the sense that for 21/2 hours you’re allowed to go beat the s--- out of somebody else--either elbow him under the boards, or throw a baseball at his head and then say it was an accident.

LS: What I am saying is the language I’ve sensed in Hollywood is different. It’s not that there’s not tough language, it’s just that it’s a lot more disguised in concepts of love and this and that, where the action at the end’s the same. Whereas the GM’s gonna say to me: “Hey, stick this up any bodily orifice.” So you know what? We both have the same dynamic, which is we do repetitive business in the same area with the same personalities.

AR: That’s why I’ve chosen to extract money and create the feeling of comfortability and equitablity at all times. And you can do the same thing calm as you can shouting.

LS: I never get excited in a negotiation. Part of the key is that you have to come back and do the same things year after year after year with the same men.

AR: I’ve learned how to do that. I must say that at one time I was extremely volatile, because I take it very proprietarily, if there be such a word, when you’re talking about someone that I’m involved with, and you’re talking about their livelihood.

LS: Let me ask you this: It’s always seemed to me, on the surface at least, that there’s more competitiveness between [entertainment] agents for existing clients, or more of a feeling like it’s fair to steal them.

AR: That’s gotten worse and worse. That’s become an unfortunate reality.

LS: How can an agent steal another guy’s client without thinking that would trigger some--

AR: They live with it. It’s survival of the fittest. It’s a very common, very base concept. And the next day they can justify it by saying, “Well, I lost that, but I picked up that.”

Playing Hurt

AR: Often I will get a client who has had a career, fallen from grace, and is now on a resurgence. Earlier on in my life, I was often referred to as somebody who became proficient at revitalizing a career, and somebody would come to me having fallen from grace and at that point I would be put upon with the task to reconfigure or revitalize a career.

LS: Now, in that process, how honest are they? Are they in denial?

AR: No. I think when they’re facing that, there’s no reality that needs to be given to them. They face it every day in rejection. And for people who have lost favor at, let’s say, the box office, there’s a reality of what they need to do to reinvigorate. You can deal with them on a much more open, and much more--I don’t want to say honest, because I choose to always give an element of honesty to everything--but I think with an ability to be sensitive yet compassionate and have them deal with what’s real.

LS: You see, there’s never been an athlete born in the United States, competing in any kind of professional sport, who allows that there’s another athlete more talented at his particular position. That’s part of the psychological motivation that keeps them going; there’s often a huge gap between their self-awareness and the reality in the world of sports. It’s unfair coaches, it’s guaranteed contracts, it’s a variety of factors stopping them from being superstars.

*

Nevertheless, all athletes face the risk of serious injury every time they play.

LS: In 1981, I had three top draft picks. The first one was Kenny Easley, the strong safety, Seattle out of UCLA. He retired from football with degenerative kidney damage and had his kidney replaced.

AR: But that was a genetic thing as opposed to an injury?

LS: No, too much ibuprofen.

AR: Wow.

LS: The second draft pick was Curt Marsh, who played offensive guard for the Raiders. Curt, after repetitive foot injuries, had his foot amputated. The third pick I had that year was Neil Lomax, the quarterback for the St. Louis [now Phoenix] Cardinals. He was the healthiest. He had his hip replaced. But the most disturbing is the state of concussions among our quarterbacks. Troy Aikman got knocked silly in the playoff game two years ago against San Francisco. So, here’s my wonderful role as sports attorney: I’ve got Steve Young playing for the 49ers, and four other 49ers. After the game, they’re completely disconsolate, so I have to empathize with them. Then I drive over to the darkened hospital room where Troy Aikman is sitting completely oblivious to who he is and where he is. And he would ask me: “Did we play today? Did we win today?” He had thrown two touchdown passes and they won.

AR: How long does that disorientation last?

LS: Well, for that evening, he kept asking me the same questions, over and over. Finally I wrote down the most commonly asked game-night Troy Aikman questions and wrote out answers to them. But it was frightening. And he never really recovered before the Super Bowl. Then Steve Young called me up and said: “Look, I read what you said about Troy, I’ve had six concussions.” I said, “Six?” He said, “Well, six official ones.” An official concussion is when they cart you off a field; an unofficial concussion is the numerous times during every game when you really don’t have your senses about you.

AR: In my business, the longevity of an actor has nothing to do with physical impairment [caused] by their services. We have stunt people--we pay people significant money to get hurt. The irony of that is you couldn’t get an actor insured to do his own stunts if they were of significance. We had that on “Point Break” with Patrick Swayze. He wanted to do his own skydiving. They wouldn’t let him. So what we agreed was . . . [pauses] I’m considering the legal ramifications of what I’m about to say.

*

Oh, go ahead.

AR: We shot everything else first and did his flying stuff last, so in case, God forbid, they could double him. But he insisted on doing it. And they wouldn’t insure it.

LS: Here’s the other concept: I’m sitting in the stands. San Francisco is playing New England this year. Drew Bledsoe gets a shoulder injury. I’m sitting in the box with Bob Kraft, the [Patriots] owner. They keep Drew Bledsoe in the game; and he’s being sacked mercilessly. What you’d like to do is jump out of the stands and get him off the field. Even though he shouldn’t have been left in the game, the game ends. And now the question is: Is he gonna play next week?

AR: Who makes those decisions?

LS: Ultimately, it’s the player’s decision as to whether he plays; it’s the coach’s decision as to whether he thinks he’s healthy [enough] to play. But it’s not that simple, because our athletes have learned to ignore pain, and they will always play under all circumstances. Steve Bartkowski played once with a broken rib and collapsed lung. But there’s Bledsoe, who’s at this point 24, trying to safeguard his long-term health, fighting the coach, Bill Parcells, and the player’s own desire to get out there and get in it.

Are You Talkin’ to Me?

Much is made of the influence that sports stars and movie stars have on young people. Michael Jordan has been criticized for endorsing sneakers that poor kids steal or even kill for. Fingers are pointed at movies for copycat crimes, such as the subway-clerk immolation in “Money Train” that supposedly inspired the killing of a New York City transit employee, even though the teenagers charged in the murder told police they’d never seen the movie.

LS: Our athletes are role models, they trigger imitative behavior. My son may want to walk like Bruce Willis, but he knows nothing about Bruce Willis’ life, nor cares other than that he’s got a movie star wife. People emulate athletes’ behavior, especially young children.

*

More than they emulate movie star behavior?

LS: Oh, I think so.

AR: I don’t know about that.

LS: They’ll emulate it in terms of speech patterns, dress.

AR: Or a role. Bobby De Niro’s famous for “Taxi Driver.” How many kids have stood in front of a mirror and rehearsed: “Are you talkin’ to me?”

LS [as De Niro]: Are you talkin’ to me?

AR: I mean, just mention the name “Taxi Driver.”

LS: Except, except, I don’t know a doggone thing about Robert De Niro other than, I mean, as a movie fan.

AR: Yeah, but you see, you’re a bad choice for that. You already live in a world devoted to icons and you’re jaded. You have much more of an awareness of athletes--

LS: No, no, no, no, no. I. Love. Movies. My grandfather ran Hillcrest Country Club and I grew up on the laps of Groucho Marx and George Burns and George Jessel and all of these guys. The reason I’m not in the field of film--

AR: That’s probably the reason--you sat on the laps of Groucho Marx and George Burns.

LS: --is that I want to enjoy that movie as a movie. I don’t want to know that the star is a really nasty human being, or beats somebody, or is greedy, or that the head of the studio had no concept of the plot and argued against it. I enjoy the art, the craft, for itself.

AR: I understand that. I would have to say that, as much as somebody might emulate the walk of Patrick Ewing or Michael Jordan, I think one is very much subject to the effects of [an actor’s] hairdo, the effects of what clothing is chosen. Jennifer Aniston has certainly affected the hairdos of young women--

LS: If I know an actor has had a drug problem, it doesn’t affect my willingness to see his movie. The city of Dallas is hyperfocused today on the fact that a wide receiver might have used drugs [Dallas Cowboy Michael Irvin pleaded no contest last month to a felony cocaine possession charge]. I’m just trying to judge the degree to which publicly known behavior influences consumers.

AR: See, there’s a certain mystique to actors when they behave badly.

LS: That’s what I was sort of driving at. I don’t have--nor do I think most fans of entertainment have--the illusion that an entertainer would live faithfully with one wife.

*

Talk about the nature of stardom. Is Michael Jordan’s celebrity different than Tom Cruise’s?

AR: We acknowledge athletes become stars, and I’ve spent some time with Shaquille, for example. I represent [former Laker coach] Pat Riley, and in my world he’s a star. But other than that visibility factor--and the fact that when you watch a basketball game Michael gets the play or Pippen gets the play--I’m not sure what comparables there are.

LS: If you’re in the city of Pittsburgh and Neil O’Donnell has just played in the Super Bowl, and you’re out to dinner, you have the same lack of ability to eat and focus as you would with a Bruce Willis.

AR: I understand that. But that is almost the beginning and the end.

LS: It’s the same exact concept because you have in sports thousands of aspirants, very few of whom ever get into the game at all, and out of that group that plays, a small number of superstars emerge. I think athletes earn and deserve every penny coming to them. An athlete, if he has the longevity and dramatic performance, can cross over out of the narrow genre of hard-core sports fans and enter into being a household name. A number of things have to happen for that to occur, but if they can make that leap, then they become a central figure of the culture.

AR: I feel there’s a difference.

LS: I have to go to the bathroom.

AR: [Gestures] Straight ahead, there. [Steinberg exits]. The major difference to me is that Michael [Jordan] has a personality. And there’s a sexuality, a charismatic quality, and I think what Leigh was referring to when he talked about the “leap” is having that charismatic quality--Magic had it in the same way. And when you see them in an environment not typical to what they do, and they still exude the same kind of confidence, charisma and personality, that’s the key. They will tell you that by mere presence. They walk into a room, they don’t need to dribble. They have command, they have a sense of their power.

THEY REALLY NEED US

Contemplate this: A world without agents. What happens?

AR: Utter chaos. I’ve created such intrinsic quality at this point that--

LS: “Apocalypse Now.”

AR: That’s a clear visual.

LS: One of the things that would happen is that negotiations between athletes and teams would quickly degenerate into bitterness and anger, because the agents do provide a real buffer, as it were, between management. If a general manager said to a player directly: “Wel l l l l, you’re not as great a passer as you think you are, and your footwork is nasty and your ability to read a second receiver is gone”--

AR: “Your last film didn’t work so well, why would I pay you as much money?” You hear what they say to the actors, and what they say to you is so different.

LS: My first client was Steve Bartkowski. He went in and did his own [negotiation]. He sat in the first meeting himself and listened to the general manager explain why, even though he was the first pick in the NFL draft, he wasn’t particularly fast and he wasn’t, you know, the greatest prospect in the world. Every time there’s a direct contact like that, you’ve got explosiveness. And some of our clients can be a little outrageous in terms of what they’ll say.

AR: And what [a client] will say to you, by the way, is very different than what they’ll say were they doing it [the negotiations]. How about this one: “I want you to get me more money, but don’t lose it. [Steinberg sputters with laughter.] OK? Don’t, don’t, don’t lose it. But I definitely want more money. And don’t come back to me unless I know I have more.”

LS: [as client]: “I don’t want this negotiation in the newspapers, I want to be on time to training camp, I don’t want you to push them too hard, but I expect a record-breaking deal.” A world without agents would have a much more idiosyncratic pay structure than it does now, because the information flow would be quite unequal.

AR: Totally.

LS: Quarterbacks in the NFL are our specialty. I can tell you every quarterback contract with complete certainty, and what’s happening in the negotiations of other quarterbacks, and predict the market. So this year, when we’ve got Neil O’Donnell, Warren Moon, Jeff George, Dave Brown, Jim Harbaugh all up for contracts, I have the ability to be able to say to the team, “No, I know we’re talking about Dave Brown, but Jeff George is gonna sign for X.”

AR: [nods]: I’ll have the information of what’s available. I’ll know what the films are in advance. I’ll know who’s agreed to do them. I’ll know what their basic fees are. So, truly, how can any one individual be responsible for that kind of coverage, were they to be on their own? Whereas my entire day is spent gathering information and corollating it. You need that information to position yourself. And the studios know that we know it. So when an actor walks in without representation, the studios know everything he doesn’t know, because he has no means of finding it out. The reality is: Who would talk to the significant stars in each field with any level of both honesty and reality? Nobody.