Sony is on the verge of scrapping director Michael Mann's movie because of a budget projected to surpass the studio's $105 million cap.

Sony put the project into turnaround late last week. But skeptics caution that move may just be a bargaining ploy, intended to rein in a headstrong helmer. Studio execs will hold a final meeting Monday with Mann, who Oscar-nominated this year for box office disappointment "The Insider," to see if the cost can somehow be trimmed.

While the studio is holding fast to its budget cap, Mann does have an ace in the form of Smith. The actor is front and center in one of Sony's most important films, the sequel to its highest grosser ever, "Men in Black."

As the Ali deals were being negotiated, Smith has warmed to donning the Ray-Bans and the dark suit once again with Tommy Lee Jones for director Barry Sonnenfeld.

But Ali is the role of his career, and Smith has been working out so strenuously that speculation is he may rethink the "MIB 2" proposition if Mann and producer Jon Peters are unable to set up the Ali project elsewhere.

The latter, however, is such a high-profile, star-studded undertaking that one of those entities with German stock market funding might gamble on it as a way to become a player in a big film, despite the so-so results of boxing's last big biopic, "The Hurricane."

The Ali project joins several potentially prestigious but pricey star-studded non-genre films that Sony has either abandoned or laid off rights to.

One recent casualty is the Lasse Hallstrom-directed adaptation of the Pulitzer Prize-winning Annie L. Proulx novel "The Shipping News," which has Kevin Spacey set to star, with "Hannibal" headliner Julianne Moore close to set as his love interest. Miramax has taken over the film, which deals with the dicey prospect of a man rebuilding his life by moving to Newfoundland after rescuing his daughters, whom his wife sold into prostitution.

New Line has taken over two Sony-originated films: the Alexander Payne-directed dark drama "About Schmidt," with Jack Nicholson expected to star; and "Life as a House," the macabre but riveting script by "As Good as It Gets" scribe Mark Andrus which will star Kevin Kline and Kristin Scott Thomas.

Sony will still distribute "Adaptation," the reteaming of "Being John Malkovich" director-scripter team of Spike Jonze and Charlie Kaufman. But the financial burden of the film, which stars Nicolas Cage, Meryl Streep and Chris Cooper, has been assumed by indie producer Intermedia.

The recent housecleaning has been part of an effort by Sony to place its bets conservatively on sequels and pictures with high commercial potential, to offset the 10 films on its 2001 release schedule being financed by former Disney movie boss Joe Roth's upstart Revolution Studios, which has a domestic distribution deal with Sony.

"We're not going to make movies for audiences that need to be dynamited out of their homes," Sony Picture Entertainment chairman John Calley told Daily Variety. "I would rather make 'Star Wars' than 'Man's Fate."'    -Daily Variety

Read about another Will Smith film which exceeded Sony's budget cap of $105 million by a factor of two: Warner Bros.' Wild Wild West (1999).