Cancelled Golden Globes Cost Economy $80 Million

With the Golden Globes losing its luster this year, the big question now is just how much green Hollywood will lose as a result.

Cancellation of the awards due to the strike could cost the local economy upwards of $80 million, according to the Los Angeles County Economic Development Corp.

(Same org values the Academy Awards at around $130 million.)

And there will be losses that are impossible to calculate: The film studios and networks use the event to publicize their kudos contenders.

NBC will air a one-hour version from the Beverly Hilton Hotel. But with money already spent to produce the event, the after-parties cancelled, last-minute travel plans being changed and TV production crews being dismissed, the fiscal result will be widespread.

Hardest hit will be NBC, which usually pulls an estimated $15 million-$20 million in ad revenues from the three-hour live broadcast, which courts mostly women 18-49.

Instead, advertisers will pay a reduced rate to air spots during the NBC News-covered event that seems likely to generate lower ratings.

As for the Hollywood Foreign Press Assn. and Dick Clark Prods., they're losing the license fee $5.8 million NBC usually pays.

The show's production costs an estimated $1 million-$2 million, with much of that already spent on the venue, sets, lighting, music, crews, red carpet, security and trucks.

All of the contracts for advertising time on NBC Sunday from 8-11 p.m. will be abrogated, as though the telecast never existed. All contracts have a force-majeure clause -- the so-called act-of-God clause -- that lets NBC off the hook because the cancellation couldn't be "reasonable anticipated or controlled" by NBC, one veteran media buyer said.

Advertisers will try to improvise and spend that money on other broadcast networks and on various cable nets during the weekend. But if there's a strong competitive show, such as Fox's preem of "Terminator: The Sarah Connor Chronicles" at 8 p.m. Sunday, it's probably already sold out because of high demand.

The HFPA will also lose out on the sale of tickets and tables in the Beverly Hilton's ballroom, as well as ads in the program. As a result, the scholarships and the programs it helps fund, such as for film restoration, are also hit.

The NBC Universal-Focus, HBO and Warner Bros.-InStyle hosted after-parties have been cancelled, while the plug is expected to be pulled on affairs hosted by the Weinstein Co. and Fox-Fox Searchlight.

Industryites said those parties carry a pricetag of $350,000-$750,000, with many of the costs to produce them, including catering fees, already paid for and nonrecoupable.

Most gifting-suite organizers didn't consider canceling their swag-packed events.

"There's no reason not to gift the celebrities and trendsetters in L.A. due to the strike," said Melissa Lemer, who along with business partner Lorena Bendinskas will host the Silver Spoon Buffet over two days this week at Voda Spa.

However, it's uncertain how many out-of-town stars will be coming to L.A.

Some companies that rely on the Globes and other high-profile events, including hotels, limo rental firms, stylists, photogs and messengers, won't feel the full impact until Sunday.

For example, if there is indeed a modest celeb turnout, that would affect the photographers who cover them. The photos from the Golden Globes run in magazines throughout the year.

"This is a double whammy for us because the People's Choice Awards didn't have a red carpet," said Celebrity Photo prexy Scott Downie.

"Agencies count on these larger events to carry us through the slow times when not much is happening in Hollywood."

Mark Kesel, owner of Event Messenger Service, would normally employ motorcycle messengers to move photogs' digital cards to wherever they are downloading the images.

"The money from these big events fills in the financial hole we get during January through February, which is always a slow time," Kesel said of this year's Globes.