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The Hollywood Way: A profile of Michael Lynton

Michael Lynton has a plan to make people buy more books.

The New Yorker, March 30, 1998

On a recent afternoon, a group of writers and editors from Penguin Books took their seats in a midtown screening room for a preview of "The Prince of Egypt," the first animated film from the new Hollywood studio DreamWorks. As the lights went down, the orange Penguin logo flashed on the screen, and a lanky, collegiate-looking man, in button-down shirt, crew-neck sweater, and khakis, strolled to the front of the room.

"Hi. My name is Michael Lynton, and I'm the chairman of Penguin Books," he said. "I saw a lot of animated movies in the ten years I worked at Disney, but I'll never forget seeing the first ten minutes of 'The Lion King' and feeling this shiver go up my spine. Well, I felt that same shiver when I saw the first ten minutes of 'The Prince of Egypt,' and I think it's going to be an incredible work of art."

For all Lynton's aesthetic appreciation of "The Prince of Egypt"-a cartoon that turns the story of Moses and the Ten Commandments into a buddy movie about the Hebrew prophet and the Pharaoh Ramses-his real interest in the movie was economic. According to his calculations, "The Prince of Egypt" will spawn a dozen children's books; already, one of the most celebrated authors in the field, Madeleine L'Engle, had been signed to write the lead title. One of the first deals Lynton concluded when he became chairman and C.E.O. of the Penguin Group, a year ago, was to publish books based on DreamWorks' upcoming movies.

As he reminded his audience, selling books the Hollywood way can be enormously lucrative. Recalling his experience as a publisher for Disney, he said, "The first animated-movie book we did at Hyperion was "The Little Mermaid.' When Jeffrey-Jeffrey Katzenberg, who was then president of Disney, and is now the co-head of DreamWorks–"asked how many copies we were planning, I told him twenty-five thousand. He said we should do a million, and I thought he was crazy. But we printed a million and a half copies and ended up selling almost two million." He added, with an aw-shucks grin, "By the time the film of 'Beauty and the Beast' came out, we were on the Times best-seller list."

The rise of Lynton, who is thirty-eight, to the chairmanship of one of the best-known international publishing companies is a remarkable success story, both for its rapid trajectory and for what it reveals about the changing nature of the book business. After getting a B.A, and an M.B.A. from Harvard, and working for a brief time on Wall Street as an investment banker, Lynton was recruited by Disney. At the age of twenty-eight, he was put in charge of Disney's new publishing division. At thirty-three, he became president of Disney's Hollywood Pictures. The offer to head Penguin came last year, shortly after he turned thirty-six.

At Penguin, the hope is that Lynton will bring not only the sort of marketing skills that his old boss, Michael Eisner, used to turn Disney into one of the world's most ubiquitous brand names but also a genuine instinct for literary properties. "When the conglomerates first bought publishing houses," the agent Andrew Wylie points out, "they installed people who had stronger business than literary training. Now they realize that they have to have both, and Michael is the perfect combination of the two." In big publishing, books are increasingly being regarded less as discrete properties than as one vital link in a media food chain that begins with an idea, takes early shape as a magazine article, gets fleshed out between book covers, gains bigger life on a movie or TV screen, and enters the hereafter as a videocassette or the inspiration for a toy. In this regard, Lynton seems an ideal manager. As Jeff Berg, the chairman of the talent agency I.C.M., told me, "I think of Michael more as a media than as a publishing executive. He appreciates the fact that media drives media, and if you have valuable properties in one area, like books, you can extend your brand name into others."

In a sense, Lynton's arrival at Penguin can be seen as the reinvigorating of an old tradition. Penguin was founded by the publisher Allen Lane in London, in 1935, and its mission was to bring inexpensive quality books to the masses. The pocket-size paperbacks sold for sixpence each (the price of ten cigarettes} and were color-coded-blue for biography, green for detective fiction, orange for novels-to make book shopping less intimidating. Lane was as shrewd as he was idealistic; with "War and Peace,"- for example, he printed fewer copies of Volume 2 than of Volume 1, on the assumption that not many readers would get that far. Three million Penguins were sold in the first year-a phenomenon that signaled "the emergence of a new social habit on a large scale," according to the London Times. Penguin became synonymous with good literature at a good price. A brand was born.

In 1978, when Peter Mayer, Lynton's predecessor, took over Penguin, he quickly broadened Lane's vision by bringing more aggressive marketing and business practices to what was by then a financially ailing firm. Under Mayer, Penguin acquired New American Libran" Hamish Hamilton, and a half-dozen smaller houses on both sides of the Atlantic. Mayer transformed Penguin into a truly international publisher, bolstering its small United States presence and establishing branches in India and South Africa to supplement its offices in Australia and New Zealand, Mayer also expanded Penguin's classics to include more international and contemporary writers, adding such controversial titles as "Fanny Hill" and "On the Road." By the time he left, in 1996, he had tripled the number of Penguin Classics titles, to fifteen hundred; they continue to sell around twenty-five million copies each year.

In the clubby world of publishing, the news that a "Hollywood type" was taking over Penguin caused some dismay. With Lynton at Penguin, a writer for the London Independent warned, "our children will be curling up in Virginia Woolf pajamas, beneath colorful Dostoyevsky duvets." Lynton wasted no time in shaking things up. During his first week on the job, he agreed to buy the Putnam Berkley Group-a three-hundred-and-thirty-six-million-dollar acquisition, which created the second-largest English-language publishing firm in the world. At the same time, Lynton showed deftness in dealing with a serious embarrassment. While the Putnam deal was being put together, it was discovered that a Penguin accountant had been giving booksellers illegal discounts and defrauding the company for the past five years. Lynton handled the problem openly and swiftly; Penguin immediately wrote off a hundred and sixty-three million dollars, which included a twenty-five-million-dollar fine to the American Booksellers Association.

Given Penguin's tradition of balancing economic profitability and cultural prestige, Lynton's decision to acquire the unabashedly commercial house of Putnam makes eminent sense. The merger immediately put Penguin Putnam on an equal footing with Random House, Simon & Schuster, and Bantam Doubleday Dell, and it has already resulted in savings of more than twenty million dollars in back-office costs. Moreover, such best-selling Putnam authors as Tom Clancy, Patricia Cornwell, Dick Francis, and Amy Tan have brought the kind of lucrative hardcover front list that Penguin, with its dependency on backlist paperback titles, had sorely lacked.

Perhaps most important, with Putnam came its C.E,O., Phyllis Grann, whose talent for spotting and nurturing best-selling authors had made her company one of the most profitable in the business. When MCA, Putnam's erstwhile corporate owner, told Grann that it wanted to get out of publishing, Penguin was the first potential buyer she talked to. "We had maxed out," she told me recently. "I was looking for someone who would think of ways to grow beyond what we were capable of, to expand beyond just selling more books. I think totally inside the box, and I needed someone like Michael, who can think outside it."

The day-to-day publishing business of Penguin Putnam is now run by Grann, while Lynton takes care of strategic, long-range issues. When Tom Clancy wanted an on-line, interactive game tied to his books, it was Lynton who arranged for Pearson, Penguin Putnam's corporate parent, to fund it. "Michael came up with a piece of the puzzle that I couldn't have," Grann said. "And without it we might have lost Clancy."

A streamlined mass of chrome and glass, the Saatchi & Saatchi Building sits on a windswept corner of Hudson Street like a spaceship poised for lift-off. Lynton's office, on the fourth floor, mirrors the building's self-conscious modernism. Blond-wood furniture is scattered across an off-white rug. Photographs of Lynton's wife, children, and parents lean against the tinted windows. A wall of Penguin paperbacks and a hardcover set of the Iliad and the Odyssey provide the only reminders that you're in a publisher's office.

Lynton, who has rather sad, Pacino-like eyes, a broad mouth, and shaggy brown hair, looks less like an executive than like a post-adolescent character actor. When I asked, by way of small talk, what stars he had got to know in Hollywood, he looked uncomfortable, and promised to get back to me with some names. (He didn't.) Eventually, I realized that Lynton, despite his studied modesty, knows just about everybody, from Warren Beatty to Gabriel Garcia Marquez. Without seeming to be disingenuous, he portrays each of his relationships as merely the result of serendipity. According to all reports, Lynton has mastered the art of "simply finding" himself at the center of things. "Michael has an ability to get close to people, no matter who they are," the head of Hyperion Press, Bob Miller, says. "He's always able to suss out the important players."

Lynton's regular-guy manner has done very well for him in a world where ego displays are the norm. He often uses the flattering conversational technique of beginning his next sentence by repeating your previous words; he peppers his conversation with cozy Yiddishisms; and he is given to using expressions like "Here's where the rubber meets the road" and "Let's talk turkey." Steve Burke, a former Disney executive, who had brought Lynton to Hollywood and who is now the president of broadcasting at ABC, told me that Lynton's refusal to acquire the usual Hollywood flamboyance gave him immediate distinction.

Lynton loves talking about books. Although he doesn't sign new authors himself; he is constantly alert to what will make a good story. In one of our conversations, he picked up a set of galleys of "Bridget Jones's Diary," the fictional chronicle of a year in the life of a neurotic single thirty-something that has been a No.1 best-seller in Britain. It had attracted no American publisher until Lynton came across it in London. "I read half of it on the plane, and thought it was very funny," he said. The book's success in Britain points to the kind of broad-based literary movement that he wishes existed in the United States. "There is this group of young British writers, like Helen Fielding, Nick Hornby, and Alex Garland, who have found a much larger mass audience than their equivalents have here," he said. "I think part of the reason is that they are so light and playful. They make fun of themselves, and don't have such a dark view of the world."

Still, Lynton is cautiously optimistic that things will get better in this country, because he perceives a renewed interest in books among baby boomers here. The trick of catering to them, he believes, is to persuade them that they are getting their money's worth-not just by offering them fine literary fiction and poetry but by providing the "best of type" in every genre. "What these baby boomers are all looking for is quality in media," he says. "You see evidence of this in the popularity of something like A&E biographies, in the fact that VH1 is playing older music, and in all the serious fiction and nonfiction on the best-seller list."

Lynton's background seems ideal for a job that requires him to move constantly between Europe and America, between "high" and "low" tastes. His parents were wealthy German Jews, who fled to The Hague in 1933 to escape Hider. Lynton's maternal grandfather had bribed a German officer to warn him before the family's holdings in Dusseldorf were to be confiscated; one night, therefore, he loaded an entire machine-tool factory he owned onto fifty box-cars and moved it to Holland. Most of the family went on to the United States when the Netherlands was invaded. When Lynton's father, Max-Ono Ludwig Lowenstein, joined the British Army, his commander suggested that he change his name, in case he should be captured. He took the name Lynton, moved to the United States, then returned to England, where Michael was born, in 1960. Nine years later, the Lyntons went back to Holland, where they established the head-quarters of the family business, Hunter Douglas, which is the largest maker of window coverings in the world.

Lynton attended an international school in The Hague, transferred to Phillips Exeter Academy, in New Hampshire, for his senior year, and from there went on to Harvard. At Harvard, he lived in a jock dorm-Kirkland House-and when he wasn't playing rugby he was building sets at the Loeb Theatre for the avant-garde productions of Peter Sellars. His best friend at Harvard, Janno Lieber, recalls, "Michael was a kid from Holland who didn't appear to be foreign, and a genteel European who lived in the closest thing Harvard had to 'Animal House.' He always searches out authentic types of one kind or another, even if they are extremely different from him."

After graduating from Harvard, in 1982, Lynton marched off to Wall Street. As an associate in the investment- banking firm of First Boston, he had a front-row seat for the New York of the go-go eighties. The combination of long working hours and extravagant night life soon convinced him that he didn't want to be a New York banker. "All that 'Bright Lights, Big City' stuff made me realize that I hated going out every night," he recalls. "I spent most evenings eating at Big Nick's, on Second Avenue, and then going home to read in bed."

When Lynton's sister, Lili, announced that she was going to Harvard Business School, he decided to join her. He disliked business school so much, though, that he almost didn't return for the second year. When he did come back, his sister agreed to leave the answers to the previous day's homework in his mailbox each morning.

In 1987, having got an M.B.A., Lynton was recruited by Disney, whose chairman, Michael Eisner, was looking for a cadre of young executives who could come up with new ways of expanding the Disney franchise. Lynton speaks warmly of his time with Disney. "We felt like the group that came into Ford with McNamara after the war," he says. "Nothing new had been done for a long time, so there was lots of opportunity." Richard Nanula, who came to Disney around the same time and is now the company's chief financial officer, recalls, "If you had a good idea, you could get it discussed that afternoon and get a decision that week. We used to say, 'The deal drives the day.'"

As a boy in Holland, Lynton had loved comic books, and many of his favorites were based on Disney characters. He had been especially fond of Topolino, a Disney comic book licensed to the Italian publisher Mondadori. At Disney, Lynton launched Disney Adventures magazine, an American version of Topolino, and its circulation quickly reached a million. Other titles-Family Fun, Discover, andFamily PO- were bought or created; before long, Disney had a full-fledged magazine division.

In 1989, Lynton established two imprints for children's books and Hyperion Press, an adult trade house. When he was barely twenty-eight, he moved back to New York to assemble a staff for them. Hyperion's first books had strong movie tie-ins. In addition to drawing on Disney's animated movies {initially, sixty per cent of Hyperion's revenue came from Disney copyrights), Lynton cut a deal with the producer Harvey Weinstein to publish screenplays under Weinstein's Miramax imprint. Screenplays had previously sold poorly, but Miramax's first screenplay, "The Piano," sold seventy-six thousand copies, and a subsequent novelized version sold over a hundred thousand copies. Lynton refused to be confined by the old rules of publishing. Brian DeFiore, a former editor at Hyperion who is now the publisher of Villard Books, recalls, "When we were negotiating a large contract, Michael brought in a record-publishing contract to analyze how it was structured and see whether there were any other rights or options we could get." On another occasion, Lynton advanced a writer ten thousand dollars just for exploratory research on a book proposal, the way a movie producer might option a story.

By 1994, a string of box-office duds had convinced Eisner that Hollywood Pictures, one of Disney's three studios, needed Lynton's leadership. Returning to L.A., Lynton made a splash by purchasing the rights to Nicholas Evans's novel "The Horse Whisperer," for three million dollars, with Robe Redford as its director and star. Hollywood was impressed: Lynton had decided to buy the Evans book on the basis of a hundred-page manuscript that had been surreptitiously faxed him from the Frankfurt Book Fair. 1995, three of Lynton's Hollywood Pictures releases-"The Santa Claus," "While You Were Sleeping," a "Crimson Tide"–earned more than two hundred and fifty million dollars domestically. Lynton himself put several projects into production, including "The Rock" and "Mr. Holland's Opus," which proved profitable.

In spite of this success, Lynton's presence was resented by some Hollywood insiders: that he hadn't paid sufficient dues. Things became difficult when Eisner underwent bypass surgery, and Katzenberg left the company on bitter terms. Rumors began circulating that Hollywood Pictures would close, and it ultimately did. "For as long as I lived in L.A., I was never entirely comfortable there," Lynton told me, choosing his words carefully. "Movies are a black hole. When a conversation peters out and someone tries to reinvigorate it by asking, 'Did you see "Titanic"?' the whole conversation gets sucked into it. Imagine living in a town where everything is about movies-where there is no other conversation. That is a horror."

Lynton's decade at Disney was, among other things, an intensive seminar in the art of brand marketing. Before "synergy" became a corporate cliché, Eisner's Team Disney was slapping the Disney logo on movies, music, TV shows, theatrical productions, theme parks, cloches, silverware, and ocean cruises. By sticking to calculatedly wholesome images, Disney created, in effect, a Good Housekeeping seal of approval for mass entertainment.

Over lunch at Provence, a French bistro near Penguin's New York offices, Lynton expounds the potential mega-power of the Penguin brand, illustrating his point with the story of Terry Waite, the Anglican clergyman who was held hostage in Beirut. "Six months into his captivity," Lynton says, "Waite made friends with his jailer, and, although they spoke different languages, he managed to tell the jailer he wanted a book. He drew an oval, and he drew a penguin, and he said, 'Find me a book that looks like this, and it will be a good book.' That story says everything about what Penguin stands for around the world."

What Disney means to mass entertainment, Lynton argues, Penguin can mean to a book-reading culture, worldwide. Using a strategy he calls "books plus," he is in the process of extending the Penguin brand into areas that, for the most part, have been off-limits to traditional book publishers. Last Christmas, while he was shopping for a good recording of Handel's Messiah," he was overwhelmed by the number of choices available. What if there were a record label with a household name, he wondered, that would guarantee good value for money? The result is Penguin Classic CDs-a line of archival recordings that Penguin is producing with PolyGram. Album notes will be written by Penguin authors and other cultural luminaries. (Elvis Costello is a candidate to write the notes for the "Rite of Spring.") Next fall, the Penguin Playhouse plans to sponsor "Masterpiece Theatre"-like performances of Penguin Classics, to be sold to cable TV.

Lynton is after the world rights in English for more titles, so that they can be published simultaneously around the globe under the Penguin imprint instead of being sold to foreign publishers. Penguin also intends to publish books in their original languages. Its International Classics will include works like "Candide," in French, and "Faust," in German. Lynton hopes to boost Penguin's brand recognition in cyberspace as well, and is currently negotiating deals with on-line booksellers which give preference to Penguin titles.

Like Peter Mayer, he has expanded the kinds of books that carry the Penguin logo. He recently decided that Penguin Readers-condensed Penguin classics designed to help people learn English-should include commercial Fiction. "The traditional Penguin assumption was that people should learn English before reciting George Eliot," he says. "I walked in and said, 'Let's try it differently and use commercial novels, too.' Look, if you're in Poland and have just seen 'The Hunt for Red October,' I'm betting that you'd rather go out and buy the Tom Clancy Penguin Reader than the Dickens Reader."

Despite grim reports about the future of publishing, Lynton remains optimistic. "The business has fundamentally sound principles," he says. "It's going through a big change in distribution, and there may be some taste change, going on, but people are still buying books. There was a time when I thought CD-ROMs would drive us out of business, but that was before I had children. The fact is that when you're trying to get your daughter to go back to sleep at four in the morning you are not going to turn on a computer. No, you read her 'Good Night Moon' or 'The Little Engine That Could.'"

Suppressing a yawn, Lynton explains that his two daughters woke up at three-thirty that morning. He grabbed a hook and read to them until he realized that he was the only one falling asleep.

"So what did you do then?" I ask.

Lynton looks sheepish and says, "I turned on the TV and let them watch the Cartoon Network."




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