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Titanic has averted disaster at the box office, but at least one of Hollywood's big holiday pictures has rammed a major iceberg: KEVIN COSTNER'S apocalyptic drama The Postman. The $80 million epic, which spent only one week among the 10 top-grossing films, will struggle to earn $20 million at the domestic box office. Though it could do better internationally, the film seems likely to rank as one of this market's costliest flops ever. It caps a miserable year for its studio, Warner Bros., which, according to Variety, dropped from second to fourth in market share and, thanks to other underachievers like Mad City and Midnight in the Garden of Good and Evil, averaged the lowest gross per film of the six major studios. The trade and business press have slammed longtime co-chairmen BOB DALY and TERRY SEMEL for relying too much on old formulas and older stars. The pair have been stretched thin since they added responsibility for Time Warner's music division in 1995, yet they continue to micromanage studio operations. Still, thanks to strong TV and overseas operations, Warner's entertainment division is expected to report that income rose 10% in 1997, and Wall Street sources say they have heard the division has forecast a 20% increase for 1998.

--By Kim Masters/Los Angeles