'South Park'-Scientology Battle Rages On
NEW YORK - "South Park" has declared war on Scientology. Matt Stone and Trey Parker, creators of the animated satire, are digging in against the celebrity-endorsed religion after a controversial episode mocking outspoken Scientologist Tom Cruise was yanked abruptly from the schedule Wednesday — with an Internet report saying it was covert warfare by Cruise that led to its departure.
"So, Scientology, you may have won THIS battle, but the million-year war for earth has just begun!" the "South Park" creators said in a statement Friday in Daily Variety. "Temporarily anozinizing our episode will NOT stop us from keeping Thetans forever trapped in your pitiful man-bodies... You have obstructed us for now, but your feeble bid to save humanity will fail!"
The Internet blogger hollywoodinterrupted.com said Thursday that Cruise threatened to not promote "Mission: Impossible 3," a surefire summer blockbuster, if the offending episode ran. Comedy Central is owned by Viacom, as is Paramount, which is putting out the film.
But Cruise's representative, Arnold Robinson, told The Associated Press Friday that the mega-star made no such demands.
"Not true," Robinson said. "I can tell you that he never said that."
A call by The Associated Press to a Paramount representative was not returned Friday.
The episode in question, "Trapped in the Closet," which first aired last November, shows Scientology leaders hailing Stan, one of the show's four devilish fourth-graders, as a savior. A cartoon Cruise locks himself in a closet and won't come out. An animated John Travolta, another famous Scientologist, enters the closet to try to get him out.
The battle began in earnest earlier this week when Isaac Hayes, another celebrity Scientologist and longtime show member — voicing the ladies' man Chef — quit the show, saying he could no longer tolerate its religious "intolerance and bigotry."
Stone and Parker didn't buy that either.
On Monday, Stone told The Associated Press, "This is 100 percent having to do with his faith in Scientology...He has no problem — and he's cashed plenty of checks — with our show making fun of Christians."
A Comedy Central spokesman said Friday that the network pulled the controversial episode to make room for two shows featuring Hayes.
"In light of the events of earlier this week, we wanted to give Chef an appropriate tribute by airing two episodes he is most known for," the spokesman said.
French Draft Law Threatens iPod's Future
PARIS - Apple Computer Inc. faces a serious challenge in France as lawmakers move to sever the umbilical cord between its iPod music player and iTunes online store — threatening its lucrative hold on both markets.
Amendments to an online copyright bill, adopted early Friday, would give rivals access to the hitherto-exclusive file formats at the heart of Apple's music business model as well as Sony Corp.'s Walkman players and Connect store.
Thanks to the massive success of the iPod models, which account for two out of every three music players sold worldwide, iTunes has become the global leader in online music sales. The iPod is currently designed not to play music from rival services.
According to the latest amendments, however, copy-protection technologies like Apple's FairPlay format and Sony's ATRAC3 must work with competing services and players. Companies that refuse to share all essential information with any rival that requests it would be ordered to do so by a judge, under threat of fines.
The draft law could force Apple to let French iPod users buy their music from download sites other than iTunes. Owners of other music players would also be allowed to buy songs from iTunes France.
"Without guaranteed interoperability, we run a major risk of captive client bases and an anti-competitive situation, with the consumer held hostage as a result," read the explanatory note accompanying one of the key amendments.
Lawmakers in the lower house voted to approve the amended text early Friday and will hold a further formal vote on Tuesday before sending the bill to the Senate for its final reading.
Although the draft law would also apply to Sony, "the implication is most serious for Apple" because of the phenomenal market penetration of the iPod and iTunes, said Roger Kay of U.S.-based research firm Endpoint Technologies Associates.
Apple spokesman Steve Dowling declined to comment on the law or say whether it could force the company to withdraw the iPod or iTunes from the French market. Sony also refused to comment.
Although iTunes was initially driven by iPod sales, some analysts say the two offerings now reinforce each other. Apple's large online music catalog, the result of its superior bargaining power, also boosts the iPod's appeal. Breaking the exclusive link removes both advantages.
Critics of the draft law say legislators have no business forcing Apple to share its proprietary format, arguing that most customers know about its limitations when they choose to buy an iPod. But consumer groups argue that the only way to give customers real choice is to end the restrictions.
"It's an essential condition for consumers and for the market itself," said Julien Dourgnon, a spokesman for UFC-Que Choisir, France's main consumer organization.
UFC has already filed a lawsuit in French courts, attacking Apple's exclusive music format as a form of anticompetitive behavior.
"It's only by resisting interoperability that Apple is able to keep this dominant position," Dourgnon said. "Once there's interoperability, it's over."
If the draft law goes through in its current form, experts say, Apple could have three broad courses of action from which to choose.
The company could look for technical solutions to comply with the new law in France while maintaining its format exclusivity elsewhere. Sales from iTunes sites are already restricted to local markets using credit card details. But preventing newly interoperable iPods from being used outside the "walled garden" would be much harder — although shipping them with French-only software could help.
Alternatively, Apple could follow the example set by Microsoft Corp. in its standoff with EU antitrust authorities: Drag its feet over compliance and wait to be sued. Court proceedings are long, damages relatively light and class actions impossible in France. Apple might calculate that its iPod and iTunes profits dwarf any potential penalties.
Finally, Apple could be forced to withdraw from Europe's third-largest music download market — or threaten to do so while seeking a change in the law.
"They may have to bluff initially by pulling product off the market and making everybody uncomfortable," Endpoint's Kay said.
But Apple's transformation into a major force in digital entertainment may ultimately lead to antitrust challenges elsewhere, including the United States, Kay said.
In that case, the French move will turn out to have been just the start of something bigger, he added. "Creating an open version of the iPod ecosystem is what everybody in the world except Apple would like."
Viacom to Sell DreamWorks Film Library
NEW YORK - Entertainment company Viacom Inc. said Friday it agreed to sell the film library of the recently acquired DreamWorks studio to an investment group led by financier George Soros in a deal that values the library at $900 million.
The 59 films in the library include "Gladiator," "American Beauty" and "Saving Private Ryan."
Viacom, which recently split off its broadcasting and publishing assets into separately traded CBS Corp., said the deal will complete the second stage of its acquisition of DreamWorks SKG Inc., the studio founded by director Steven Spielberg, producer David Geffen and former Walt Disney Co. executive Jeffrey Katzenberg.
The buyers are Soros Strategic Partners LP and Dune Entertainment II LLC.
Soros and Dune will acquire all 59 DreamWorks live action films released through Sept. 15 of last year, while Soros will distribute the library through an exclusive five-year agreement with Paramount, the company said.
Viacom will retain ownership of music publishing and certain other rights related to the library, including sequel and merchandising rights. The company also will own a minority stake in the entity holding the library assets.
Viacom will have the right to reacquire the library, and Soros and Dune will have the right to sell it to Viacom, beginning at the end of the fifth year after the deal. The parties also may acquire the other's interest under certain conditions.
While full details of the deal were not disclosed, it's likely Soros and Dune will look to get a return on their investment through licensing the film library's content on DVDs, cable and worldwide television broadcasts, said Harold Vogel, media analyst and author of the book "Entertainment Industry Economics."
"They'll project how much each film can generate," Vogel said. "The difficulty is, probably only the top 10 films generate 80 percent of the income."
In December, Viacom's Paramount Pictures unit agreed to buy DreamWorks SKG for $775 million in cash, plus $825 million in debt and other obligations. At that time, the studio said it would finance the deal by immediately selling the DreamWorks film library, which Paramount valued at between $850 million and $1 billion.
Viacom said Friday it expects the net purchase price for DreamWorks to be about $600 million after converting certain commercial agreements from debt to advances.
The sale is expected to close in April, pending closing conditions, the company said.
The distribution agreement with Paramount will automatically renew if Soros still owns the library after the fifth year, Viacom said.
Dune Entertainment is an affiliate of Dune Capital Management LP.
Viacom stock rose 69 cents, or 1.8 percent, to close at $39 on the New York Stock Exchange.