A STARTLING NEW CONCEPT: : Family Films : With money tight and criticism of sex and violence high, studios are looking closer at PG’s power

Columbia Pictures has revamped its ad campaign for the Bill Murray hit “Groundhog Day,” focusing on the cuddly little rodent himself. Twentieth Century Fox is gearing up for animation. Warner Bros. had no family films on its 1992 release slate; this year, it has four.

In Hollywood, PG is in.

“Any smart businessperson can see what we must do,” Columbia Pictures Chairman Mark Canton informed the theater exhibitors attending the ShoWest convention earlier this month. During an era of rising production costs, he said, family oriented films give more bang for the buck.

History backs him up. Although greatly outnumbered by R-rated releases, G and PG films have made considerable inroads at the box office. “Aladdin” is the highest-grossing film in Disney history--surpassing such blockbusters as “Pretty Woman” and “Three Men and a Baby.” Twentieth Century Fox’s “Home Alone” is No. 3 of all-time, after two other family-oriented entries: “E.T.” and “Star Wars.” The home-video potential, moreover, is equally as great. Of the top-25 consumer video rentals, all but four--three exercise cassettes and the feel-good “Fried Green Tomatoes”--are aimed at the younger set.

Social as well as fiscal factors are feeding the family film trend. Hollywood is being targeted for excessive sex and violence. Recessionary times create a market for uplift and diversion. Equally important, the baby boomers are finally growing up.

“The audience that worshiped Martin Scorsese and headed for ‘Mean Streets’ is now living Steve Martin’s life in ‘Parenthood,’ ” observes William Morris senior vice president Joan Hyler. “That doesn’t mean that they won’t be going to the art houses, but as parents they both relate to, and have a need for, a broader range of films.”

Producer Mark Johnson (“Rain Man”) agrees: “Many filmmakers such as myself waited a long time to start a family or are working on our second one. I’d give my eyeteeth to make a good movie I could present to my kids.”

According to David Davis, a film analyst with Paul Kagan Associates, a PG film is more than twice as likely to break the $60-million mark in domestic box-office receipts as its R-rated counterpart. “There is an under-exploited segment in the motion picture industry that could be costing the studios millions of dollars,” he concludes.

This comes as no surprise to the Walt Disney Co., which has turned out successful live-action family fare such as “Mary Poppins” and “The Absent-Minded Professor” since the 1950s. Though more recent efforts such as “Newsies” failed to take off, the $12-million “Muppet Christmas Carol” and the $10-million “The Mighty Ducks” pulled in $25 million and $50 million, respectively. It’s too early to determine the fate of the African adventure “A Far Off Place” but “Homeward Bound: The Incredible Journey” has been in the Top 10 ever since its February release. Walt Disney Pictures, which has more than tripled its output in the past few years, will be serving up “The Adventures of Huck Finn” on April 4.

Disney’s track record, acknowledges Bruce Berman, president of worldwide production at Warner Bros., has spurred other studios to follow its lead. Warners will release John Hughes’ “Dennis the Menace,” “Free Willy” (the story of a boy and a whale) and the children’s classic “The Secret Garden” this summer and “The Nutcracker,” with Macaulay Culkin, at Christmastime.

“This resurgence of family pictures is no coincidence,” he says. “We’ve begun to realize there’s a big audience out there. Kiddie films are no longer seen as movies that adults have to deal with for 75 or 80 minutes. Quality films reaching parents and kids is the primary target.”

With this in mind, Columbia paired an 11-year-old boy with Arnold Schwarzenegger in “The Last Action Hero,” a summer release. And unlike Schwarzenegger’s “Predator” and “Terminator 2,” it will carry a PG-13 rating. “Material can be adapted to certain parameters,” Canton explains. “Action-adventure doesn’t have to be graphic and gory.”

Universal is taking a similar tack with “Jurassic Park,” Steven Spielberg’s costly adaptation of Michael Crichton’s dinosaurs-on-the-loose tale. Not only is the anticipated PG-13 rating more in sync with Spielberg’s sensibility, it also maximizes the studio’s chances of making its money back.

“PG films, if they’re good, generally have a greater afterlife,” says Bob Dingilian, executive vice president of marketing for MGM, which is releasing its own family film, Robert Townsend’s “Meteor Man,” an inner-city fairy tale, this year. “Kids love cassettes, so there’s a tremendous home video market. The networks and cable are concerned with this demographic, which makes for good TV sales. And since family films are very visual, language is less of a problem. Disney films are enormous overseas.”

Though the special effects in Disney’s “Honey, I Blew Up the Kid” nudged the budget up to the $40-million mark, family films generally come in for far less than the $29-million average. “Most of these films don’t have to be populated by above-the-line actors and directors,” explains David Vogel, executive vice president of Walt Disney Pictures. “They usually depend on story rather than on high-priced talent.”

On “Homeward Bound,” the story of two dogs and a cat, Disney evidently had the best of both worlds: an adult sensibility with Michael J. Fox, Don Ameche and Sally Field as the canine and feline voices, without the expense and temperament that comes with a mega-star cast. “There was no measuring of each other’s trailers,” quips one Disney executive of the animal leads. “No requests for travel on the company plane. Best of all, we only shelled out kibble.”

Family films are also more likely to generate the “repeat” business that separates mere hits from blockbusters. “Kids don’t mind watching the same movie four or five times,” notes Warners’ Berman. “Especially since Chuck E. Cheese, ice cream and toy stores are also at the mall. These movies also drive our licensing and retail store businesses. Out of our ‘Batman’ animated TV series, we developed a whole new line of toys.”

Animation may be far more costly and time-consuming than live-action, but when it works, the payoff is there. “The Little Mermaid” (domestic gross $84 million), “Beauty and the Beast” ($148 million) and “Aladdin” (nearing the $200-million mark) not only scored at the box office but, in what is termed “the evergreen effect,” will be re-released every seven years.

Though Universal is releasing live-action family films such as “Cop and a Half” (the story of an 8-year-old boy and a policeman), “We’re Back” (a cinematic remake of the well-known children’s book) and a sequel to the ultra-profitable “Beethoven” (“Beethoven’s 2nd”), studio chief Tom Pollock says they are milking animation as well. “We’ve been making animated films since 1986 and doing it very profitably,” he says. “We haven’t had blockbusters like Disney, but films like ‘An American Tail’ and ‘The Land Before Time’ were in the $50-(million) to $70-million range. Having Steven Spielberg gives us a leg up. He’s not only talented but has a name--just like ‘Walt Disney.’ That helps us a lot in selling the film.”

Twentieth Century Fox is also throwing its hat into the ring, releasing a full-length animated feature, “Once Upon a Forest,” in addition to live-action family films such as the baseball movies “The Sandlot” and “Rookie of the Year” and “The Page Master,” starring the ubiquitous Macaulay Culkin. “Animation is tricky,” admits Tom Jacobson, president of worldwide production for the studio. “Those films are made and sold very differently from the rest. We’re in the process of educating ourselves.”

Whatever the case for family films, cautions Fox’s Jacobson, they’ll ultimately be judged on their merits. “Though success validates a genre, it’s a mistake to tap into easy profit-and-loss formulas,” he says. “ ‘Home Alone’ is a phenomenon, not the rule. Particularly in a more competitive marketplace, a movie will only do business if it’s good.”