Universal and Fox close to a deal for Halo movie

Microsoft's tough demands for the proposed Halo movie may have turned off many large Hollywood studios, but the firm's gamble may still have paid off - with Universal and Fox reported to be nearing agreement on a deal to make the film.

It emerged last week that Microsoft was shopping the project - complete with a script penned by 28 Days Later scribe Alex Garland for a cool $1 million - around major film studios, with a lengthy list of financial, production and creative demands attached.

Among those demands were a $10 million upfront payment against 15 per cent of the film's gross takings, a minimum budget of $75 million not counting the salaries of the director and actors, 60 first class plane tickets to bring Microsoft staff to the premiere of the movie - and complete creative control over the project.

The demands were too much for most Hollywood studios, especially since Microsoft wasn't proposing to put a cent of its own cash into the film - with the software giant arguing that it didn't want to move into the business of movie financing.

DreamWorks, New Line Cinema, Disney, Paramount Pictures and Warner Brothers dropped out of the running within a matter of hours, and the film wasn't offered to any of the Sony Pictures studios such as Columbia Tristar and MGM as a result of the rivalry between Sony and Microsoft in the videogames sector.

That left just Universal and Fox, who now appear to be on the verge of hammering out a deal that would see Universal handling production and North American distribution, while Fox would get the overseas rights for the film and would have some input into the production process.

The deal also sees Microsoft and its agency, Creative Artists, relenting on some of its demands - most notably the financial aspects, with the up-front payment being reduced to $5 million and the firm's share of the gross dropping to 10 per cent, which is still very high for such a deal.

However, the deal is not yet sealed - and could yet be scuppered by the contentious issue of creative control. Microsoft is reportedly demanding that the Alex Garland script be unchanged, that everything in the movie must comply with a "bible" prepared by developers Bungie and that the production must be approved on an ongoing basis by a Microsoft observer.

The reasons for this are clear - Microsoft doesn't want to risk the movie being out of step with the Halo universe which Bungie has created in the two games and three books released so far, not to mention the direction planned for future games in the massive-selling series.

It's not clear what concessions, exactly, Fox and Universal are demanding in terms of creative control. We should know soon enough, however; if the deal goes through, Microsoft is said to be keen to rush the project into production as soon as possible, perhaps with a view to launching the movie next year, when Halo 3 is also expected to arrive on Xbox 360.

The New York Times