John Hughes's `Hollywood' Has a Chicago Backdrop

A NEW media partnership has put grit behind Chicago's claim that when it comes to studio entertainment, the south shore of Lake Michigan is the country's ``Third Coast.''

John Hughes, a Chicago-based writer/director/producer, announced last month the launch of Great Oaks Entertainment, a joint venture with producer Ricardo Mestres. Among his 27 films, Mr. Hughes is known for ``Home Alone'' and its sequel, the ``National Lampoon's Vacation'' films, and ``The Breakfast Club.''

Great Oaks plans to produce 12 movies with three studios. It will also develop projects for television, publishing, and interactive media, says Mr. Mestres, former president of Hollywood Pictures.

The tie-up is part of a trend toward cross-genre alliances in entertainment. Executives increasingly recognize that together they can better meet rising production costs and explore new, potentially lucrative ways to apply technology to entertainment, say industry experts.

DreamWorks SKG is another high-profile example of such a partnership. The $2 billion multimedia studio was founded with great fanfare last year by director Stephen Spielberg, former Disney chairman Jeffrey Katzenberg, and David Geffen, founder of Geffen Records. DreamWorks will make live-action feature films, music, animation, television programs, and interactive software.

``There seems to be a tremendous amount of vertical integration going on, where companies are expanding into giant media gargantuas,'' says Mestres, who oversaw production of ``The Santa Clause'' and ``Quiz Show'' while at Hollywood Pictures. He declined to offer a financial profile for Great Oaks.

The launch of Great Oaks should give a much-needed fillip to Chicago's feature film industry. After logging a record year of $115 million in 1993, production dollars spent in Chicago plummeted to $55 million last year, according to the Chicago Film Office.

Eventually, says Charles Geocaris, director of that city-funded office, the Hughes partnership should mean more jobs in entertainment and related services for the city.

``John Hughes has been a one-man movie factory in Chicago and the merger will mean a great deal for the city,'' says Ruth Ratny, editor of Screen, a Chicago-based weekly magazine.

Between 1991 and 1993, Chicago was the site for such movies as ``Groundhog Day,'' ``Rookie of the Year,'' ``The Fugitive,'' and ``Home Alone 2.'' The city also hosted two television series, ``The Untouchables'' and ``Missing Persons.''

Although the current downturn is partially cyclical, competition is increasing. Hollywood studios today may choose from more than 230 cities worldwide with film promotional offices, Mr. Geocaris says. The Canadian cities of Vancouver and Toronto are fiercely competitive today because of the comparatively low value of the Canadian dollar. Also, Chicago's undeserved reputation as a union town scares off some producers, he adds.

Still, spending on feature films is just a fraction of the $850 million production industry. The city benefits far more from television commercials, music, post-production work, and other forms of entertainment operations than from feature films, says Ms. Ratny of Screen.

For Hughes, Chicago and the Midwest offer an escape from the narrow outlook of Hollywood.

Hughes says he initiated the creation of Great Oaks in order to drastically cut down his involvement in Hollywood deal-making, which has claimed 70 percent of his work time.

He says he will now be able to minimize his time in Hollywood, write and direct far more than before, and stir up the spirit of comedy behind much of his work.

``Chicago ... always had a good sense of humor. Probably because of Chicago's lousy weather, cold winters, meatpackers, candymakers, slaughterhouses, we don't let people stay on pedestals too long,'' Hughes says.