From council estate to Cannes, Archway to Absolute Beginners, the Powell-Woolley story is a salutary tale. By Christopher Hawtree; The Egos Have Landed: The Rise and Fall of Palace Pictures by Angus Finney, Heinemann, pounds 16.99
Scarcely a publishing season goes by without a breathless account of the crazed collapse of another company which once appeared all-conquering. This time, the money so rashly scattered on the winds is that of Palace Pictures. It is a history which the publishers would have us believe is "all flavoured with a distinctly Eighties nostalgia".

Certainly Nik Powell and Steve Woolley made the de rigueur oddball - but effective - entrepreneurial couple. Powell's education was straddled between his schoolfriend Richard Branson's fledgling Virgin outfit and, even wilder, Sussex University. Woolley, too bright for the denizens of the Archway council estate on which he was brought up, had sought adolescent refuge in the darkness of all those now-vanished repertory cinemas of the Seventies and later clipped tickets as an usher at the Screen on the Green in Islington. Powell's eventual disgruntlement with Virgin, which was to cost him pounds 96m in lost shares, brought him in closer touch with Woolley, who had risen through such ranks as there were in the world of independent movie theatres. It was a partnership which in an amazingly short time would have them seeking, and batting around, vast sums of money.

Angus Finney is enthralled by all this, so much so that anybody would think that he is chronicling the making of Citizen Kane rather than The Company of Wolves or what he takes to be the incendiary content of the lumpen Scandal. The old gag of the book's title is wit itself compared with Finney's prose, which has a numbing, mock-immediate tone. Insufficiently distanced from this pell-mell story, Finney loses track of the fact that cinema-goers never turn up because one particular company is behind a movie.

Such is the nature of the business that innumerable people cross the path of Powell and Woolley, which means that the thumbnail portraits should have been neatly pared if the book were to be less of a cuttings-driven blur. Every so often, such familiar anecdotes as Joanna Whalley's non- nudity in Scandal are alleviated by a defter vignette, whether it be a drunken debauch at Cannes or the cool professionalism with which Ennio Morricone deliberately damaged a demo tape so that David Leland was obliged to sing him the sort of music needed for The Big Man.

For all this, what is missing from the book is any real sense of cinema. As one looks through the two lists of Palace movies, those distributed by it and those it produced, one realises how much better the firm was at buying in other companies' work than it was at generating the stuff. On the one hand we have the likes of Blood Simple, Paris Texas and When Harry Met Sally; on the other, there is that clunker Absolute Beginners, which anybody could have seen was a no-no from the start, and movie after movie rooted in television - indeed, so many of them demanded a six-pack within easy reach that Adrian Turner was understating the case with his celebrated remark that a typical Palace movie comprises "fast cars, loud music and blow jobs".

The initial lack of interest here in The Crying Game was surely the right one. After the twist in the plot and Forrest Whittaker's bravura performance, there is nothing in it that requires a large screen. Every so often Finney lambasts Channel 4's failure to invest in one mooted production or other, but there are times when one must wonder whether its funding of a movie - even the prospect of it - is in fact baleful. That small screen only exacerbates the British inability to think in terms of a movie proper.

The crash of Palace need not vex posterity. It will take products of rather more clout than Backbeat and The Neon Bible for its successor, Scala Productions, to win over backers contemplating a lesson obvious to every reader of The Egos Have Landed except its author.