Recently writing about the pattern of the Marvel Cinematic Universe (MCU) grosses from Thor 4 forward I found myself hitting on the subject not just of what it portended for Guardians of the Galaxy 3, but also The Marvels, still half a year away--enough so that it seemed worth giving that its own post.
Ant-Man 3 was the precedent that seemed to me most relevant to Guardians of the Galaxy 3, given that it is likewise a "lesser" Marvel franchise coming out not quite three months after the other movie, with the estimates for its opening weekend domestic gross strongly suggesting a similar course (a rough one-third drop in inflation-adjusted, real terms from what the last film made leaving it with an approximately $700 million gross).
By contrast Black Panther 2 seemed a more relevant parallel for The Marvels, in part because of the parallels between the preceding films. Captain Marvel, like Black Panther, was the first film in a new series; put out during Marvel's Phase Three peak (2018-2019); released in the early part of the year (March 8, as against February 16, a mere three weeks off); touted as an event (indeed, a milestone!) because of its protagonist's ethnicity or gender; and similarly made over a billion dollars at the box office (back when a dollar was officially worth a good deal more than it is today).*
Fast-forward to today, and one notes that Black Panther 2 was put out amid declining excitement about the MCU in the wake of Phase Four's underperformance; put out in November; and simply did not have the cachet of the first because a sequel to a movie supposedly important as a "first" simply could not be an event in the same way. (One might add that in becoming "female-led" Black Panther 2 became in yet another way even more like the upcoming Captain Marvel 2.)
Black Panther 2 ended up making half of what Black Panther did. It does not seem unreasonable to anticipate Captain Marvel 2 doing the same on the basis of those parallels, which would mean a gross of some $600-$700 million.
Moreover, it should be noted that Captain Marvel 2 has liabilities Black Panther 2 (even with the loss of a well-liked star) did not.
There is the divided reaction to the first Captain Marvel film.
There is the tie-in with a Disney streaming show that not everyone Marvel Studios must be hoping will come see the film will have watched (which hurt Dr. Strange 2).
And there is arguably greater doubt about the movie--with the MCU racking up further underperformances (Black Panther 2 included in the view of those disposed to see it as such, and the unquestioned disappointment of Ant-Man 3, while Guardians of the Galaxy may go the same way), and the decision to bump the release of The Marvels from July to November not helping.
The result is that The Marvels may suffer an even steeper drop than Black Panther 2 did, possibly slipping below the $600 million mark to rival Ant-Man 3 in its earnings.
For the time being we have not heard much about what the movie ultimately cost, only partial numbers released to date, while one can only wonder as to just how big and expensive the post-production job that prompted the more than three months' delay is. But it is worth recalling that the original Captain Marvel saw Disney-Marvel spend over $450 million on the film (with $175 million just the net production cost). Sequels are rarely cheaper to make than the original, while the extended post-production, and the possibility of a more than usually aggressive promotional push to help prop up the good Marvel name(s) in which Disney has so much invested, would make a still heavier outlay plausible. Should the movie after all that end up with $600 million, or even less, from the theatrical run, its profits will not just be a long way from the $400 million+ the studio may have made from the first film (and expected of the second!), but the return negative.
Of course, a lot could happen in the six months between now, and when the movie will hit theaters, with The Flash an object lesson in just how much the expectations (or at least, the press' expectations) can change in such a short period. Yet this is the pattern I see as relevant for the time being--while, as we are on the subject of that other movie, it seems to me that people are swinging from one extreme to the other, if not regarding the film's quality, then at least its likely box office. Even a better-than-expected Flash film, and some positive buzz and word-of-mouth, is likely to boost it only so much in a crowded summer. The same would go for Captain Marvel 2, a very great gap existing between the numbers I am talking about here, and the $1.3-$1.4 billion grossed by the original, or even just the billion-dollar mark the MCU has found ever more elusive in even this inflationary era.
* Arguably the view of Black Panther as a "milestone" was more important in the U.S. than elsewhere. It actually ended up the highest-grossing movie of the year in North America in 2018, outdoing even Avengers: Infinity War with its $700 million domestic gross ($800 million+ today), but performed more like other Marvel movies abroad (pulling in just 48 percent of its take internationally). Still, the first Black Panther's international gross was markedly greater than the sequel's, some $647 million ($750 million in 2022 terms) to Black Panther 2's $405 million.
For an updated view of the issue, see the author's latest on Captain Marvel 2's prospects.
Friday, May 5, 2023
How Will The Flash Do at the Box Office?
Until recently I have not discussed box office predictions much here, and when I have done so (especially when addressing predictions made in advance of the film's hitting theaters), have usually offered comment on other people's predictions rather than trying to come up with my own predictions from scratch.
The main reason that I have been offering more predictions lately is that the Marvel Cinematic Universe (MCU), and its component series', have run for so long by this point as to give us lots and lots of data in which even those of us who are not Hollywood insiders privy to test screenings and other such information can look for patterns.
We have less of that to go on in the case of the later, less prolific DC Extended Universe (DCEU), which has also been less consistent--and is already slated for a much-publicized overhaul, meaning we will not get very much more to work with before having to rethink our assumptions. Still, prior to that we will get a few more films, notably a Blue Beetle movie "upgraded" from the original plan for a streaming release; a sequel to the DCEU's sole billion dollar-hit, Aquaman; and of course, The Flash.
The buzz for Aquaman 2 has been surprisingly bad recently; the buzz for The Flash, surprisingly good, spectacular even, such that one may wonder just how it will do at the box office when it comes out six weeks from now in mid-June.
Considering this my first thought is that the Barry Allen/Flash character simply does not have the cachet of the other members of the Justice League, while there is no special angle that would make this "more" than just "another superhero" movie (the way Wonder Woman was, for example) in a market where there has been a super-abundance of the super-hero stuff for as long as most of us can remember (perhaps not irrelevantly including another incarnation of the Flash himself on the small screen in the Arrowverse for nine seasons), and "fatigue" possibly setting in. Meanwhile star Ezra Miller's current public image is . . . unhelpful, enough so as to probably put off some of the audience.
Moreover, The Flash will be going out into the most crowded summer box office season since before the pandemic. People will have lots of other options--so many that if it happens that the movie gets good press late in the game and has the advantage of positive word-of-mouth the crowding will limit its "legs," as they will any other movie we get this year. (I will say it again: Top Gun 2 had a lot of advantages, but in the cheer-leading mood surrounding it just about no one wanted to admit that one of the most important was that it had very little competition compared with releases in most summers.)
The result is that there is some room for the movie to "overperform," but from relatively low expectations. Screen Rant's Cooper Hood, for example, predicted $700 million as the movie's gross back in January, before the press became more bullish. Just going by my gut (on which I am more reliant here, again, because there is less to compare this movie to) I can picture the movie making that, or even more than that--but the billion-dollar mark seems to me beyond its reach. Will I have occasion to change my mind? I suppose I will find out in the coming weeks.
The main reason that I have been offering more predictions lately is that the Marvel Cinematic Universe (MCU), and its component series', have run for so long by this point as to give us lots and lots of data in which even those of us who are not Hollywood insiders privy to test screenings and other such information can look for patterns.
We have less of that to go on in the case of the later, less prolific DC Extended Universe (DCEU), which has also been less consistent--and is already slated for a much-publicized overhaul, meaning we will not get very much more to work with before having to rethink our assumptions. Still, prior to that we will get a few more films, notably a Blue Beetle movie "upgraded" from the original plan for a streaming release; a sequel to the DCEU's sole billion dollar-hit, Aquaman; and of course, The Flash.
The buzz for Aquaman 2 has been surprisingly bad recently; the buzz for The Flash, surprisingly good, spectacular even, such that one may wonder just how it will do at the box office when it comes out six weeks from now in mid-June.
Considering this my first thought is that the Barry Allen/Flash character simply does not have the cachet of the other members of the Justice League, while there is no special angle that would make this "more" than just "another superhero" movie (the way Wonder Woman was, for example) in a market where there has been a super-abundance of the super-hero stuff for as long as most of us can remember (perhaps not irrelevantly including another incarnation of the Flash himself on the small screen in the Arrowverse for nine seasons), and "fatigue" possibly setting in. Meanwhile star Ezra Miller's current public image is . . . unhelpful, enough so as to probably put off some of the audience.
Moreover, The Flash will be going out into the most crowded summer box office season since before the pandemic. People will have lots of other options--so many that if it happens that the movie gets good press late in the game and has the advantage of positive word-of-mouth the crowding will limit its "legs," as they will any other movie we get this year. (I will say it again: Top Gun 2 had a lot of advantages, but in the cheer-leading mood surrounding it just about no one wanted to admit that one of the most important was that it had very little competition compared with releases in most summers.)
The result is that there is some room for the movie to "overperform," but from relatively low expectations. Screen Rant's Cooper Hood, for example, predicted $700 million as the movie's gross back in January, before the press became more bullish. Just going by my gut (on which I am more reliant here, again, because there is less to compare this movie to) I can picture the movie making that, or even more than that--but the billion-dollar mark seems to me beyond its reach. Will I have occasion to change my mind? I suppose I will find out in the coming weeks.
Thor 4 vs. Black Panther 2 vs. Ant-Man 3 . . . vs. Guardians of the Galaxy 3 and The Marvels?
From Thor 4 on every new Marvel movie has, in inflation-adjusted, "real" terms, taken in one-quarter to one-half less than the preceding film in the series (Thor 4 vs. Thor 3, etc.). Moreover, the significance of the trend is confirmed by the fact that, where available, the profits show it--"cash-on-cash return" as calculated by Deadline showing a one-half drop in profit for Thor 4 and Black Panther 2 as against Thor 3 and the original Black Panther, respectively.
Thor 4 had the smallest drop in box office gross (of roughly one-quarter), Black Panther 2 the biggest (one-half), while Ant-Man 3 was in the middle (its worldwide gross about a third down from that of Ant-Man 2). It may seem surprising that Black Panther 2 suffered the biggest drop, given the tendency to present it as a hit, as against Ant-Man 3's generally acknowledged failure. However, whatever one makes of the many factors involved in such "spin," the original Black Panther was treated as an event, producing a result even a well-received sequel was unlikely to match, while the loss of the star was a further handicap--while people tend to be less quick to call a movie that made over $800 million a flop as against one that failed to break the half billion-dollar barrier (the more for the post-pandemic era being one of "flexible" expectations in such matters).
The result is that it is probably more useful to focus on the other two films when gauging the prospects of new Marvel movies, like Guardians of the Galaxy 3, which, as I have already argued given the estimates regarding the opening weekend, may play out like Ant-Man 3, with a (real, inflation-adjusted) gross a rough one-third lower than what Guardians of the Galaxy 2 managed (expectations which will be partially confirmed, or disconfirmed, by Sunday).
Still, it seems to me possible that the Black Panther series may be a more useful precedent for considering the fate of The Marvels. Its predecessor, Captain Marvel, like Black Panther, was a release in the first three months of the year touted as an "event," in part because it was the first MCU movie with a female lead, but also in part because the climax of Marvel's Phase Three in the mega-event of the release of Avengers: Endgame was a mere seven weeks away. The result was a $1.1 billion gross in early 2019, which is more like $1.3 billion in the terms of early 2023 (and, if the Fed is right about the inflation rate, maybe more like $1.4 billion later this year)--such that even a very well-received Marvels movie would probably not do as well. Especially given the divided reaction to Captain Marvel (this was the movie that officially drove Rotten Tomatoes to introduce two audience scores in an attempt to limit the effect of "review-bombing"); the tie-in between a major MCU movie and a Disney streaming show (which strategy did not serve Dr. Strange 2 well, and will probably not serve this movie well either, especially given that the show prompted similar reactions to the first Captain Marvel movie); and the decision to bump the movie's release from late July to November (which has been grist to the mill of the skeptics, among whom the rumor that poor test screenings is circulating); there is that much more reason to anticipate "headwinds." Indeed, it may not be unreasonable to anticipate a Black Panther 2-like fall from the gross of the original Captain Marvel (which is to say, a real terms drop of half into the $600-$700 million range), while I would not rule out the film's performing even below this mark (perhaps, sliding down into Ant-Man 3 territory).
Of course, it is just May--and the release of The Marvels a whole half year away. But it is hard to picture anything in the next six months strongly enhancing this movie's prospects from whatever they happen to be now--especially if Guardians of the Galaxy 3 fails to revive the public's excitement about the MCU.
Thor 4 had the smallest drop in box office gross (of roughly one-quarter), Black Panther 2 the biggest (one-half), while Ant-Man 3 was in the middle (its worldwide gross about a third down from that of Ant-Man 2). It may seem surprising that Black Panther 2 suffered the biggest drop, given the tendency to present it as a hit, as against Ant-Man 3's generally acknowledged failure. However, whatever one makes of the many factors involved in such "spin," the original Black Panther was treated as an event, producing a result even a well-received sequel was unlikely to match, while the loss of the star was a further handicap--while people tend to be less quick to call a movie that made over $800 million a flop as against one that failed to break the half billion-dollar barrier (the more for the post-pandemic era being one of "flexible" expectations in such matters).
The result is that it is probably more useful to focus on the other two films when gauging the prospects of new Marvel movies, like Guardians of the Galaxy 3, which, as I have already argued given the estimates regarding the opening weekend, may play out like Ant-Man 3, with a (real, inflation-adjusted) gross a rough one-third lower than what Guardians of the Galaxy 2 managed (expectations which will be partially confirmed, or disconfirmed, by Sunday).
Still, it seems to me possible that the Black Panther series may be a more useful precedent for considering the fate of The Marvels. Its predecessor, Captain Marvel, like Black Panther, was a release in the first three months of the year touted as an "event," in part because it was the first MCU movie with a female lead, but also in part because the climax of Marvel's Phase Three in the mega-event of the release of Avengers: Endgame was a mere seven weeks away. The result was a $1.1 billion gross in early 2019, which is more like $1.3 billion in the terms of early 2023 (and, if the Fed is right about the inflation rate, maybe more like $1.4 billion later this year)--such that even a very well-received Marvels movie would probably not do as well. Especially given the divided reaction to Captain Marvel (this was the movie that officially drove Rotten Tomatoes to introduce two audience scores in an attempt to limit the effect of "review-bombing"); the tie-in between a major MCU movie and a Disney streaming show (which strategy did not serve Dr. Strange 2 well, and will probably not serve this movie well either, especially given that the show prompted similar reactions to the first Captain Marvel movie); and the decision to bump the movie's release from late July to November (which has been grist to the mill of the skeptics, among whom the rumor that poor test screenings is circulating); there is that much more reason to anticipate "headwinds." Indeed, it may not be unreasonable to anticipate a Black Panther 2-like fall from the gross of the original Captain Marvel (which is to say, a real terms drop of half into the $600-$700 million range), while I would not rule out the film's performing even below this mark (perhaps, sliding down into Ant-Man 3 territory).
Of course, it is just May--and the release of The Marvels a whole half year away. But it is hard to picture anything in the next six months strongly enhancing this movie's prospects from whatever they happen to be now--especially if Guardians of the Galaxy 3 fails to revive the public's excitement about the MCU.
Thursday, May 4, 2023
Guardians of the Galaxy 3: Reviewing the Range of Predictions
With Guardians of the Galaxy 3 about to kick off the summer movie season the range of predictions regarding the movie's box office gross discussed here may be of some interest. These are as follows:
* At the start of the year an analyst publishing in Screen Rant suggested $1.2 billion.
* Going by the inflation-adjusted performance of the first two Guardians films I considered $1 billion as the outcome were it to simply do as well as its predecessors (with a little over half coming from overseas).
* Considering how the last Marvel Cinematic Universe (MCU) film did in comparison with its predecessor--how, as if the drops from film to film previously seen with Thor and Black Panther were not bad enough, Ant-Man 3's fell so far short of Ant-Man 2--I suggested a $700 million gross were Guardians 3 to see its gross drop in comparable fashion relative to Guardians 2 (as, with its domestic gross falling a rough sixth, its international gross closer to half, it winds up with a bit under $400 million at home, a little over $300 million more from overseas).
* Considering the expectations regarding its opening weekend I extrapolated a gross in the $700 million range from what the opening weekend meant for Guardians 2 (with $320 million at home, $420 million from abroad, $740 million plausible, though with the take easily less).
* Combining both the Ant-Man-like drop and the opening weekend now expected I got a gross closer to $600 million than $700 million, or even under the $600 million mark.
In all these you have a range from $1.2 billion down to half that or less in the relatively dark scenario I developed out of the combination of the precedent of Ant-Man 3, and the current, lowered, expectations for the opening weekend.
The high end of this range would be not just a morale-boosting topping of the billion-dollar mark for the MCU for only the second time since 2019 (the first was Spider-Man: No Way Home), but a series best for the Guardians movies.
The low end of this range would be very bad indeed for Marvel, given that Guardians is its best chance to demonstrate the franchise's continued health in 2023--while even calling into doubt whether the rather "pricey" movie would cover its cost.
Considering these numbers it is worth recalling that when Screen Rant's analyst offered the $1.2 billion estimate he also estimated that Ant-Man 3 would be a billion-dollar hit. In fact it made it less than half that, which is what we would see were the movie to wind up with <$600 million.
I do not rule out the possibility of such a collapse. But presented with these possibilities I am sticking with the $700 million take, give or take $50 million, predicted by both the current expectations for the opening weekend and the Ant-Man-style collapse calculation as the most likely outcome--not what backers or fans of the MCU would hope for, but not the worst-case scenario for now.
And thereby ends the speculation about how the film will do on the basis of anticipations and precedents. Within mere hours the movie will be in theaters--and for the short period in which speculation about its box office take will still have any meaning, people will be doing it from real numbers as the ticket-buyers finally have their say, deciding whether or not, as I suspected, Chris Pratt's highest grossing film this year is the one that has already been playing in theaters for a month.
* At the start of the year an analyst publishing in Screen Rant suggested $1.2 billion.
* Going by the inflation-adjusted performance of the first two Guardians films I considered $1 billion as the outcome were it to simply do as well as its predecessors (with a little over half coming from overseas).
* Considering how the last Marvel Cinematic Universe (MCU) film did in comparison with its predecessor--how, as if the drops from film to film previously seen with Thor and Black Panther were not bad enough, Ant-Man 3's fell so far short of Ant-Man 2--I suggested a $700 million gross were Guardians 3 to see its gross drop in comparable fashion relative to Guardians 2 (as, with its domestic gross falling a rough sixth, its international gross closer to half, it winds up with a bit under $400 million at home, a little over $300 million more from overseas).
* Considering the expectations regarding its opening weekend I extrapolated a gross in the $700 million range from what the opening weekend meant for Guardians 2 (with $320 million at home, $420 million from abroad, $740 million plausible, though with the take easily less).
* Combining both the Ant-Man-like drop and the opening weekend now expected I got a gross closer to $600 million than $700 million, or even under the $600 million mark.
In all these you have a range from $1.2 billion down to half that or less in the relatively dark scenario I developed out of the combination of the precedent of Ant-Man 3, and the current, lowered, expectations for the opening weekend.
The high end of this range would be not just a morale-boosting topping of the billion-dollar mark for the MCU for only the second time since 2019 (the first was Spider-Man: No Way Home), but a series best for the Guardians movies.
The low end of this range would be very bad indeed for Marvel, given that Guardians is its best chance to demonstrate the franchise's continued health in 2023--while even calling into doubt whether the rather "pricey" movie would cover its cost.
Considering these numbers it is worth recalling that when Screen Rant's analyst offered the $1.2 billion estimate he also estimated that Ant-Man 3 would be a billion-dollar hit. In fact it made it less than half that, which is what we would see were the movie to wind up with <$600 million.
I do not rule out the possibility of such a collapse. But presented with these possibilities I am sticking with the $700 million take, give or take $50 million, predicted by both the current expectations for the opening weekend and the Ant-Man-style collapse calculation as the most likely outcome--not what backers or fans of the MCU would hope for, but not the worst-case scenario for now.
And thereby ends the speculation about how the film will do on the basis of anticipations and precedents. Within mere hours the movie will be in theaters--and for the short period in which speculation about its box office take will still have any meaning, people will be doing it from real numbers as the ticket-buyers finally have their say, deciding whether or not, as I suspected, Chris Pratt's highest grossing film this year is the one that has already been playing in theaters for a month.
Wednesday, May 3, 2023
What Will Guardians of the Galaxy 3 Make in its Opening Weekend?
A couple of weeks ago I offered an estimate of Guardians of the Galaxy 3's box office gross (that now, perhaps unsurprisingly given the movie's coming out Friday, seems to be getting a lot of traffic).
At the time I concerned myself with the film's overall box office performance, not its opening weekend performance, which is the main thing we are hearing about now. According to Variety, Guardians of the Galaxy, Volume 3, is expected to take in $120 million in its opening weekend at the domestic box office.
This sounds robust (and certainly the relevant media presents this as excellent). But $120 million is, even in current dollars, about a fifth down from what Guardians of the Galaxy 2 made in its opening weekend during the same three-day period in May (May 5-May 7) six years ago. Some $147 million, when one adjusts it for today's prices, that opening weekend take was more like $180 million.*
So basically the expectation is that Guardians of the Galaxy 3 will make a third less than Guardians of the Galaxy 2--suggesting the new movie's making a lot less than its predecessor.
Might the film have better "legs" offsetting an underwhelming opening weekend, however? I know of no reason to think so. Quite the contrary, it is a highly publicized threequel coming into a crowded-as-usual summer movie season very different from last year's, in which circumstances the same "front-loading" of the gross as was seen with the preceding movie made seem rather plausible. Guardians of the Galaxy picked up 38 percent of its total domestic gross in those first three days--a typical figure for high-profile sequels--and should Guardians of the Galaxy 3 do the same it would end up with about $320 million in the till. This is less than what the preceding Guardian films made in current dollar terms, and about a third down from what Guardians of the Galaxy 3 made in real, inflation-adjusted terms.
Down near the bottom end of the range of predictions previously being discussed (roughly, $290-$400 million), were the international grosses (57 percent of the total previously) to go the same way the movie's final global tally would be in the vicinity of $740 million, again a significant drop from what came before (Guardians of the Galaxy 2 a billion dollar hit in today's terms).
Moreover, it seems some analysts are even less optimistic about key parts of the picture. Deadline, which estimated a $130 million gross for the film's opening weekend not quite three weeks ago, now offers another estimate in the area of $110 million, which, apart from setting us up for still less on the basis of the same formulas I have used here (a Guardians movie taking in $290 million domestically, $670 million globally), in itself bespeaks the kind of falling expectations that preceded Thor 4's less-than-stellar performance last summer. Meanwhile I find myself thinking about Ant-Man 3's underwhelming performance, and how that was much more a matter of underperformance internationally rather than at home in North America. Where Ant-Man 3's box office slipped by a sixth domestically, it fell about half internationally in real terms. Were the drop for Guardians' international gross to be that much greater than its domestic drop (which already seems likely to be much sharper than the one Ant-Man 3 suffered, one-third rather than one-sixth, and maybe worse) it is not inconceivable that the international take could be that much weaker.
The result is that if a Guardians performance in the $700-$750 million range looks worrisome, worse still is quite conceivable. In the event of $290 million in North America, combined with an Ant-Man 3-like drop internationally, the movie might not see $600 million. Were the international drop, again, increased in severity, as the American drop increased in severity, the movie could see a good deal less than $600 million.
At this point it seems one could say something of potential profitability. Even with its reported $250 million budget Guardians 3 would not necessarily be a money-loser with a $700-$750 million gross. After all, Thor 4, budgeted at a similar level, if failing to cover its cost in its theatrical run, eventually brought in a $100 million cash-on-cash return thanks to characteristically healthy Marvel revenues from home entertainment/streaming/TV (and perhaps more still from merchandise, and from keeping the bigger-than-any-one-movie-or-series Marvel machinery grinding along). And there is for the time being no reason to think the profitability of a Guardians movie at that level would be worse. But it would likely be less than Disney-Marvel was hoping for from a Guardians of the Galaxy 3, the more in as it is a good deal less profit than it made from Guardians 2 ($190 million adjusted for today's terms, by my reckoning), continuing the pattern of falling profits (indeed, halved profits on its latest sequels relative to their predecessors, as seen with Thor 4 and Black Panther 2), and reaffirming the increasingly widespread view that Marvel's heyday is a thing of the past rather than proving the occasion on which the mega-franchise rallied and showed up the naysayers. Moreover, in 2023 it will not have a better chance than this one was, with the animated Spider-Man and the Kraven movies different sorts of projects, best judged by a different standard, and the only other comparable MCU movie The Marvels, which has been bumped from July all the way out to November.
I will have more to say of that film's chances--as well as Guardians' own prospects--as more data comes in.
* As always, I am using the Bureau of Labor Statistics' Consumer Price Index, in this case adjusting May 2017 prices for those of March 2023.
At the time I concerned myself with the film's overall box office performance, not its opening weekend performance, which is the main thing we are hearing about now. According to Variety, Guardians of the Galaxy, Volume 3, is expected to take in $120 million in its opening weekend at the domestic box office.
This sounds robust (and certainly the relevant media presents this as excellent). But $120 million is, even in current dollars, about a fifth down from what Guardians of the Galaxy 2 made in its opening weekend during the same three-day period in May (May 5-May 7) six years ago. Some $147 million, when one adjusts it for today's prices, that opening weekend take was more like $180 million.*
So basically the expectation is that Guardians of the Galaxy 3 will make a third less than Guardians of the Galaxy 2--suggesting the new movie's making a lot less than its predecessor.
Might the film have better "legs" offsetting an underwhelming opening weekend, however? I know of no reason to think so. Quite the contrary, it is a highly publicized threequel coming into a crowded-as-usual summer movie season very different from last year's, in which circumstances the same "front-loading" of the gross as was seen with the preceding movie made seem rather plausible. Guardians of the Galaxy picked up 38 percent of its total domestic gross in those first three days--a typical figure for high-profile sequels--and should Guardians of the Galaxy 3 do the same it would end up with about $320 million in the till. This is less than what the preceding Guardian films made in current dollar terms, and about a third down from what Guardians of the Galaxy 3 made in real, inflation-adjusted terms.
Down near the bottom end of the range of predictions previously being discussed (roughly, $290-$400 million), were the international grosses (57 percent of the total previously) to go the same way the movie's final global tally would be in the vicinity of $740 million, again a significant drop from what came before (Guardians of the Galaxy 2 a billion dollar hit in today's terms).
Moreover, it seems some analysts are even less optimistic about key parts of the picture. Deadline, which estimated a $130 million gross for the film's opening weekend not quite three weeks ago, now offers another estimate in the area of $110 million, which, apart from setting us up for still less on the basis of the same formulas I have used here (a Guardians movie taking in $290 million domestically, $670 million globally), in itself bespeaks the kind of falling expectations that preceded Thor 4's less-than-stellar performance last summer. Meanwhile I find myself thinking about Ant-Man 3's underwhelming performance, and how that was much more a matter of underperformance internationally rather than at home in North America. Where Ant-Man 3's box office slipped by a sixth domestically, it fell about half internationally in real terms. Were the drop for Guardians' international gross to be that much greater than its domestic drop (which already seems likely to be much sharper than the one Ant-Man 3 suffered, one-third rather than one-sixth, and maybe worse) it is not inconceivable that the international take could be that much weaker.
The result is that if a Guardians performance in the $700-$750 million range looks worrisome, worse still is quite conceivable. In the event of $290 million in North America, combined with an Ant-Man 3-like drop internationally, the movie might not see $600 million. Were the international drop, again, increased in severity, as the American drop increased in severity, the movie could see a good deal less than $600 million.
At this point it seems one could say something of potential profitability. Even with its reported $250 million budget Guardians 3 would not necessarily be a money-loser with a $700-$750 million gross. After all, Thor 4, budgeted at a similar level, if failing to cover its cost in its theatrical run, eventually brought in a $100 million cash-on-cash return thanks to characteristically healthy Marvel revenues from home entertainment/streaming/TV (and perhaps more still from merchandise, and from keeping the bigger-than-any-one-movie-or-series Marvel machinery grinding along). And there is for the time being no reason to think the profitability of a Guardians movie at that level would be worse. But it would likely be less than Disney-Marvel was hoping for from a Guardians of the Galaxy 3, the more in as it is a good deal less profit than it made from Guardians 2 ($190 million adjusted for today's terms, by my reckoning), continuing the pattern of falling profits (indeed, halved profits on its latest sequels relative to their predecessors, as seen with Thor 4 and Black Panther 2), and reaffirming the increasingly widespread view that Marvel's heyday is a thing of the past rather than proving the occasion on which the mega-franchise rallied and showed up the naysayers. Moreover, in 2023 it will not have a better chance than this one was, with the animated Spider-Man and the Kraven movies different sorts of projects, best judged by a different standard, and the only other comparable MCU movie The Marvels, which has been bumped from July all the way out to November.
I will have more to say of that film's chances--as well as Guardians' own prospects--as more data comes in.
* As always, I am using the Bureau of Labor Statistics' Consumer Price Index, in this case adjusting May 2017 prices for those of March 2023.
Estimating the Commercial Prospects of a Major Film: A Fuller View
Deadline's first "Most Valuable Blockbuster Tournament" in three years, and its addition to and update of the ever-growing mass of data those Tournaments have produced, has had me rethinking my formula for estimating a movie's likely profitability from the more commonly publicized pieces of information (production budgets and box office grosses). Now it seems to me more useful to think less in terms of just the movie's succeeding or failing in its making its money back from the theatrical run than what that run portends more broadly--in what it can suggest about subsequent earnings from home entertainment, streaming, TV; and worthwhile to pay more heed to expenses that come after a movie is "finished" and out, like the "residuals and participations"; precisely because we have enough such data systematically collected to allow one to plausibly make some generalizations about them.
Of course, all that said, one should acknowledge the roughness of any such generalization. Apart from the vagueness of any numbers given us by the media (e.g. "Was that the cost of the production, or the net cost of the production?"), and the frank uncertainty (and even chicanery) associated with the calculations of accountants at the studios as in any other business (the words "There is no net" are a cliché for a reason), movies and their performances differ in all sorts of ways. Low-budget movies, as against high-budget movies, devote relatively less to production than to other expenses. (Saving money on a production does not make the cost of prints and ads any cheaper, especially if the movie is supposed to get a well-publicized wide release. Thus the total expenses on Where the Crawdads Sing ran to $123 million--even though the production itself cost a mere $24 million.) Movies that do less well in theaters tend to derive a higher share of their revenue from home entertainment/streaming/TV. (Crawdads, again, made some $120 million from the latter, as against just $68 million in theatrical rentals, so that they accounted for almost two-thirds of the total revenue in Deadline's analysis.) At a given level of earnings it makes a big difference what kind of deal the "talent" got, and whether the movie "underperformed" or "overperformed". (The fact that Top Gun 2 gave Tom Cruise a very generous contract to play Maverick Mitchell again, and then overperformed as it did, meant that participations alone came to an extraordinary $280 million--as against the $177 million actually spent on making the actual movie! Paramount's profit was still colossal--but this was a big bite out of the possible return on investment.)
All the same, crunching the numbers does afford one some meaningful averages that are at least a basis for good guesses--with this going all the more for the purposes of the kind of calculations I tend to here as my writing focuses on the likelihood that big-budget, blockbuster-type films lost money, broke even or turned in a profit rather than anything more precise. From that standpoint it seems to me reasonable to say that, when we count in the fuller outlay in the Deadline manner, a production budget (which in the absence of any information to the contrary I assume to be all net outlay to be on the safe side) is likely to represent no less than half and more likely a third of the total expense of the movie. At the same time the movie's theatrical rentals (40-50 percent of the gross, if usually closer to the 50 than the 40 mark) are commonly about 50 percent higher than what it will net the backer in home entertainment/streaming/TV (with Avenger vs. Thanos-caliber hits tending to do relatively less well because the box office take is so huge, while smaller earners, again, derive more of their money from the non-theatrical sources).
What does this work out to for, say, a $200 million production (like Ant-Man 3)? Going by the rules of thumb given here the fuller expenses will be upwards of $400 million, and likely in the vicinity of $600 million. With the movie needing to take in around 60 percent of that at the box office merely to let the later home entertainment options close the gap, at even the low end of the spectrum it would need something in the vicinity of $240 million in theatrical rentals simply to let a commonplace performance in home entertainment suffice to cover the remainder. That is to say, nothing less than $450 million at the box office is likely to do, while a half billion dollars or more are more likely to be required. At the high it would need $360 million, implying a gross in the area of $750 million at the least, and maybe even more like $900 million, again, just to break even, with worse quite possible (for instance, if a star's contract claims a significant share of the gross).
In that last "normal" year before the pandemic, 2019, maybe ten movies made $900 million--a fact that should remind us that, even where individual movies make colossal profits, the risks, and frequent losses, are likewise colossal, enough so that I wonder if the viability of this whole way of making and distributing movies is not increasingly in question.
Of course, all that said, one should acknowledge the roughness of any such generalization. Apart from the vagueness of any numbers given us by the media (e.g. "Was that the cost of the production, or the net cost of the production?"), and the frank uncertainty (and even chicanery) associated with the calculations of accountants at the studios as in any other business (the words "There is no net" are a cliché for a reason), movies and their performances differ in all sorts of ways. Low-budget movies, as against high-budget movies, devote relatively less to production than to other expenses. (Saving money on a production does not make the cost of prints and ads any cheaper, especially if the movie is supposed to get a well-publicized wide release. Thus the total expenses on Where the Crawdads Sing ran to $123 million--even though the production itself cost a mere $24 million.) Movies that do less well in theaters tend to derive a higher share of their revenue from home entertainment/streaming/TV. (Crawdads, again, made some $120 million from the latter, as against just $68 million in theatrical rentals, so that they accounted for almost two-thirds of the total revenue in Deadline's analysis.) At a given level of earnings it makes a big difference what kind of deal the "talent" got, and whether the movie "underperformed" or "overperformed". (The fact that Top Gun 2 gave Tom Cruise a very generous contract to play Maverick Mitchell again, and then overperformed as it did, meant that participations alone came to an extraordinary $280 million--as against the $177 million actually spent on making the actual movie! Paramount's profit was still colossal--but this was a big bite out of the possible return on investment.)
All the same, crunching the numbers does afford one some meaningful averages that are at least a basis for good guesses--with this going all the more for the purposes of the kind of calculations I tend to here as my writing focuses on the likelihood that big-budget, blockbuster-type films lost money, broke even or turned in a profit rather than anything more precise. From that standpoint it seems to me reasonable to say that, when we count in the fuller outlay in the Deadline manner, a production budget (which in the absence of any information to the contrary I assume to be all net outlay to be on the safe side) is likely to represent no less than half and more likely a third of the total expense of the movie. At the same time the movie's theatrical rentals (40-50 percent of the gross, if usually closer to the 50 than the 40 mark) are commonly about 50 percent higher than what it will net the backer in home entertainment/streaming/TV (with Avenger vs. Thanos-caliber hits tending to do relatively less well because the box office take is so huge, while smaller earners, again, derive more of their money from the non-theatrical sources).
What does this work out to for, say, a $200 million production (like Ant-Man 3)? Going by the rules of thumb given here the fuller expenses will be upwards of $400 million, and likely in the vicinity of $600 million. With the movie needing to take in around 60 percent of that at the box office merely to let the later home entertainment options close the gap, at even the low end of the spectrum it would need something in the vicinity of $240 million in theatrical rentals simply to let a commonplace performance in home entertainment suffice to cover the remainder. That is to say, nothing less than $450 million at the box office is likely to do, while a half billion dollars or more are more likely to be required. At the high it would need $360 million, implying a gross in the area of $750 million at the least, and maybe even more like $900 million, again, just to break even, with worse quite possible (for instance, if a star's contract claims a significant share of the gross).
In that last "normal" year before the pandemic, 2019, maybe ten movies made $900 million--a fact that should remind us that, even where individual movies make colossal profits, the risks, and frequent losses, are likewise colossal, enough so that I wonder if the viability of this whole way of making and distributing movies is not increasingly in question.
Is Profitability Possible for Indiana Jones and the Dial of Destiny?
I see no reason to change any of that now.
Still, I do see some grounds for expanding on it. As my qualifier "as of the end of the theatrical run" indicates I did not concern myself with subsequent earnings--home entertainment, streaming, TV. However, crunching the recent Deadline numbers on twenty movies of 2022, which show pretty much the same picture in this respect as we had before the pandemic, it seems to me that one can say something of those home entertainment, etc., earnings, specifically that they tend to come to about two-thirds of what a movie took in theatrical rentals (the 40-50 percent of the gross the studio gets) in the case of big-budget films, which is to say that the final revenue averages roughly 60 percent theatrical, 40 percent from those other streams. It also seems that one can say something of the fuller expenses--like the costs of that release in those other media--which mean that the total expenses on a film commonly run three times the production budget these days (and sometimes more).
Going by the "production budget times three formula," and in the absence of information to the contrary the assumption that the $300 million production cost is the net figure, Disney-Lucasfilm may be spending up to $900 million on Indiana Jones altogether (a colossal but not unprecedented outlay). Going by the 60/40 theatrical/non-theatrical split, the movie would need some $500-$550 million in theatrical rentals--which means $1-$1.3 billion in box office gross--just to reduce the gap to be made up by the non-theatrical options to the proportions at which home entertainment and the rest could be expected to make it up. And this might be optimistic, given the role of participations and residuals here given that, after all, they brought Harrison Ford back to play Indiana Jones a fifth time.
The result is that, unless what we have heard about the production's costs are way off (and sometimes the expenditures do indeed turn out to be significantly less), it is easy to see the Indiana Jones film falling short of what it would need not only to make its money back in theaters, but to do so even with the help of post-theatrical revenue. A "mere" $750 million gross could leave the studio well into the red on this production, with the gap too big to be filled up by those other revenues. Of course, for all that the film may have some value to the franchise by keeping up interest in the older Jones films, moving associated merchandise, etc., but a bigger success would fulfill that object much more effectively than an underperforming Indiana Jones movie. And in the end there is a world of difference between merely minimizing one's losses, and enjoying the kind of roaring success that motivated Disney's purchase of Lucasfilm, and backing a big-budget Indiana Jones film.
Considering such a return on investment I find myself thinking of the trajectory of the blockbuster. Raiders of the Lost Ark, way back in 1981, cost what in today's terms would be some $60 million to make--a fifth what this movie has run--while the other associated expenses (e.g. publicity) were probably still smaller--while Indiana Jones 5 for all the extra investment, would be doing very well indeed to merely match its box office take (in today's terms, in the vicinity of $1.3 billion), which would still, even with the vastly enlarged home entertainment/streaming/TV income, just let it break even.
Just as with the historical epics and musicals that bloomed in the '50s, increasingly struggled in the '60s, and did not wholly survive that latter decade, the outlays have got to a point that makes vast investments to highly uncertain result the norm, so much so that just as with those genres I look at movies like this and think "This can't go on." But for the time being "this" is still going on, because at its level of capitalization, and facing the competition it does from those other media, Hollywood simply cannot go on in any other way.
Thursday, April 27, 2023
Artificial Intelligence Enters Into Our Labor Disputes. (A Few Thoughts on the WGA Strike.)
Most of the time I have for my subject writers of print fiction. However, the looming threat of a Writer's Guild of America (WGA) strike has brought renewed attention to the conditions in which those who write for the screen toil--which, like the conditions for working people in any other line, have not been improving. Quite the contrary, the WGA informed us in a bulletin this past March that those writers who are actually working are making less--in real, inflation-adjusted terms, almost a quarter (23 percent) less--than was the case a decade ago.
Where this process is concerned one can argue for "organic" changes in the market--like the rise of streaming--but it is also the case that the production companies and studios have fought bitterly to cut writers out of the gains.
In considering the situation it seems worth noting that the writers are up against businesses that, hardly genial to their workers in even the best of times, are very hard-pressed now--battered by the pandemic, and coming to grips with their earlier reckless spending on content as interest rates go up, compelling severe cuts in production. (Disney is a particularly conspicuous case, but Netflix, Warner Bros. and the rest are all doing the same. Remember how WBD buried a nearly complete Batgirl movie rather than put it out there?) The result is that they are even less likely than usual to be concilatory.
The result is that, as one anonymous member of the Guild said, "We're looking at the extinction of writing as a profession." Should the Guild actually act in accordance with that thinking this might be a long, grueling contest such as Hollywood has not seen in a very, very long time. That seems unlikely to have much of an immediate effect on the saturated media consumer just yet, but it may be a sign of things to come as artificial intelligence as such increasingly enters into the disputes of labor with management.
Wednesday, April 26, 2023
The Profitability of the Marvel Cinematic Universe in Phase Three--and Afterward
Taken together Deadline's lists of the most profitable movies of the year from 2015 on give those of us who are not studio insiders a better-than-usual picture of the economics of the blockbuster because they go beyond production budgets and box office grosses to a fuller accounting of costs and revenues, at least at the top of the market. In the process they give us a fairly good picture of the Marvel Cinematic Universe's commercial performance, precisely because it has been so prominent at the top, with this going in particular for Phase Three--ten of the MCU's eleven third phase films making Deadline's lists, which is to say, all but Ant-Man 2 (an omission unlikely to skew the picture very much even if we had the numbers, given its lower cost and lower earnings).
Going by Deadline's numbers Disney-Marvel expended some $5.6 billion on the ten films listed here, counting everything from production, to prints and ads, to overhead and interest, to video costs, to participations and residuals. Beyond those expenses it made some $3.5 billion from theatrical rentals, home entertainment, streaming/TV--a better than sixty percent "cash-on-cash" return for the lot. Granted, this was money in yesteryear's prices spread out in rather uneven fashion over many years, but making some account of inflation it seems to me that we still have a $7 billion or so outlay in March 2023 dollars, and over $4 billion in earnings above that outlay, not changing the proportions much.*
All of this only underlines what a force to be reckoned with the MCU was at its height, commercially speaking. Of course, this was disproportionately due to the two-part Avengers battle with Thanos, which took in $1.4 billion in estimated profit in 2018-2019 (and $1.7 billion in real terms in today's dollars), but even without them I calculate the average for the other non-Avengers movies discussed here as (helped by the particular successes of Spider-Man: Far From Home, Black Panther and Captain Marvel) in the vicinity of $275 million in today's terms (and even the weaker Ant-Man 2 unlikely to drag this down much were it included).
The result is a very high standard of profitability indeed--the kind that no reasonable person can expect to see go on for any franchise for very long, and which Disney especially should not have expected to see go on forever given its experience with Star Wars--in which Episode VII made over a $900 million profit, and then Solo made a $77 million (or even worse) loss just two-and-a-half years later, a literal billion dollar drop in returns.
The MCU has yet to have its Solo, of course, and I am not sure that it will, the MCU perhaps too big for even a failure that severe and that unambiguous to stop in its tracks (especially so long as the films bring viewers to Disney's streaming service, and help to keep MCU merchandise selling). All the same, this puts into perspective the performance of its most recent movies. Thor 4 and Black Panther 2 were still money-makers, but brought in just half the profit their predecessors did, while looking at Ant-Man 3's theatrical performance it seems possible that it might barely break even, or lose a little money, even with the home entertainment-type revenue counted in, while the upcoming releases of Guardians of the Galaxy 3 and The Marvels may be up against significant headwinds, and any Avengers vs. Thanos-caliber event, or even Spider-Man: No Way Home-caliber event, looking a long way off as of April 2023.
The fact matters the more because even if this is cause for anxiety rather than full-blown disaster, Disney faces so many problems on so many different fronts. The company is now coping not just with the hole in its balance sheet made not just by the pandemic (which took a toll on its movies like everyone else's), but also reckless overspending on for-streaming content (admittedly a problem everyone else had), the shaky results of its investment in Lucasfilm as of late (with Indiana Jones 5 not a sure winner and the plans for the Star Wars franchise on the big screen remaining unsettled year in, year out), and the massive losses in its original mainstay of animation (with Strange World and Lightyear together losing the studio over $300 million all by themselves, on top of the money almost certainly lost by the hugely expense yet straight-to-streaming Turning Red). All of that means that it really, really needs wins here, and these are getting to be fewer and smaller.
* I adjusted the figures by converting the figures’ value in the month of the movie’s release for March 2023 prices using the Consumer Price Index and got $6.7 billion in costs, $4.1 billion in return-on-cash--a method that seemed sufficiently rough to merit rounding to the nearest billion to be on the safe side.
Going by Deadline's numbers Disney-Marvel expended some $5.6 billion on the ten films listed here, counting everything from production, to prints and ads, to overhead and interest, to video costs, to participations and residuals. Beyond those expenses it made some $3.5 billion from theatrical rentals, home entertainment, streaming/TV--a better than sixty percent "cash-on-cash" return for the lot. Granted, this was money in yesteryear's prices spread out in rather uneven fashion over many years, but making some account of inflation it seems to me that we still have a $7 billion or so outlay in March 2023 dollars, and over $4 billion in earnings above that outlay, not changing the proportions much.*
All of this only underlines what a force to be reckoned with the MCU was at its height, commercially speaking. Of course, this was disproportionately due to the two-part Avengers battle with Thanos, which took in $1.4 billion in estimated profit in 2018-2019 (and $1.7 billion in real terms in today's dollars), but even without them I calculate the average for the other non-Avengers movies discussed here as (helped by the particular successes of Spider-Man: Far From Home, Black Panther and Captain Marvel) in the vicinity of $275 million in today's terms (and even the weaker Ant-Man 2 unlikely to drag this down much were it included).
The result is a very high standard of profitability indeed--the kind that no reasonable person can expect to see go on for any franchise for very long, and which Disney especially should not have expected to see go on forever given its experience with Star Wars--in which Episode VII made over a $900 million profit, and then Solo made a $77 million (or even worse) loss just two-and-a-half years later, a literal billion dollar drop in returns.
The MCU has yet to have its Solo, of course, and I am not sure that it will, the MCU perhaps too big for even a failure that severe and that unambiguous to stop in its tracks (especially so long as the films bring viewers to Disney's streaming service, and help to keep MCU merchandise selling). All the same, this puts into perspective the performance of its most recent movies. Thor 4 and Black Panther 2 were still money-makers, but brought in just half the profit their predecessors did, while looking at Ant-Man 3's theatrical performance it seems possible that it might barely break even, or lose a little money, even with the home entertainment-type revenue counted in, while the upcoming releases of Guardians of the Galaxy 3 and The Marvels may be up against significant headwinds, and any Avengers vs. Thanos-caliber event, or even Spider-Man: No Way Home-caliber event, looking a long way off as of April 2023.
The fact matters the more because even if this is cause for anxiety rather than full-blown disaster, Disney faces so many problems on so many different fronts. The company is now coping not just with the hole in its balance sheet made not just by the pandemic (which took a toll on its movies like everyone else's), but also reckless overspending on for-streaming content (admittedly a problem everyone else had), the shaky results of its investment in Lucasfilm as of late (with Indiana Jones 5 not a sure winner and the plans for the Star Wars franchise on the big screen remaining unsettled year in, year out), and the massive losses in its original mainstay of animation (with Strange World and Lightyear together losing the studio over $300 million all by themselves, on top of the money almost certainly lost by the hugely expense yet straight-to-streaming Turning Red). All of that means that it really, really needs wins here, and these are getting to be fewer and smaller.
* I adjusted the figures by converting the figures’ value in the month of the movie’s release for March 2023 prices using the Consumer Price Index and got $6.7 billion in costs, $4.1 billion in return-on-cash--a method that seemed sufficiently rough to merit rounding to the nearest billion to be on the safe side.
Tuesday, April 25, 2023
Beyond Ticket Sales: What Movies Make From Streaming and Television
Having long been aware that theatrical release is only part of how a film makes back the money put into them, when I offer my estimates of "hit" and "flop," money-maker and money-loser, I try to emphasize that I am only assessing the economics of the theatrical release, and not the overall performance. This is partly because important as the box office is in itself, and indicative as it tends to be of the broader outcome (it is generally the theatrical hit that makes the most in home entertainment, and merchandising, and vice-versa), it is not everything, with the figures on home entertainment and the like that tend to be less available sometimes making an important difference.
As it happens Deadline's "Most Valuable Blockbuster Tournament" of many years now has given us a far from comprehensive but still noteworthy base of information for judging film earnings from home entertainment options like streaming and television--indeed, one plausibly useful enough that it seems to me that some generalization about how this works these days is possible. Going by the data it collected for 2015-2019 in reasonably consistent fashion, with the pattern of which Deadline's figures for 2022 seem broadly consistent, it seems that the ten or so most profitable "blockbusters" of the year make about 57 percent of their net earnings from theaters, 43 percent from the home entertainment/streaming/TV options. The biggest hits in theaters tend to make the most money from the other sources, too, but they still tend to make relatively more of their net from theaters, the lower earners relatively less. Thus Avengers 3 and 4 picked up two-thirds of their money theatrically, Avatar 2 almost four-fifths of its money in theaters at last check, while the horror hit Smile made less than half there, and Strange World not much more than a quarter.
The last of these films verifies the principle that the theatrical release is usually the key indicator. That Strange World made via home entertainment, TV, streaming three times what it did from theatrical releases did not save it from being the worst flop of the year, leaving Disney "another $200 million in the red..)
All the same, there are sometimes significant surprises, with Black Panther 2 a case in point. Its $325 million from home entertainment, television, streaming made the difference between its barely breaking even, or losing money (its theatrical run was not unjustly seen as a disappointment), and its being one of the most profitable big movies of 2022.
As it happens Deadline's "Most Valuable Blockbuster Tournament" of many years now has given us a far from comprehensive but still noteworthy base of information for judging film earnings from home entertainment options like streaming and television--indeed, one plausibly useful enough that it seems to me that some generalization about how this works these days is possible. Going by the data it collected for 2015-2019 in reasonably consistent fashion, with the pattern of which Deadline's figures for 2022 seem broadly consistent, it seems that the ten or so most profitable "blockbusters" of the year make about 57 percent of their net earnings from theaters, 43 percent from the home entertainment/streaming/TV options. The biggest hits in theaters tend to make the most money from the other sources, too, but they still tend to make relatively more of their net from theaters, the lower earners relatively less. Thus Avengers 3 and 4 picked up two-thirds of their money theatrically, Avatar 2 almost four-fifths of its money in theaters at last check, while the horror hit Smile made less than half there, and Strange World not much more than a quarter.
The last of these films verifies the principle that the theatrical release is usually the key indicator. That Strange World made via home entertainment, TV, streaming three times what it did from theatrical releases did not save it from being the worst flop of the year, leaving Disney "another $200 million in the red..)
All the same, there are sometimes significant surprises, with Black Panther 2 a case in point. Its $325 million from home entertainment, television, streaming made the difference between its barely breaking even, or losing money (its theatrical run was not unjustly seen as a disappointment), and its being one of the most profitable big movies of 2022.
The Profitability of Thor 4: A Note
When Thor 4 came out expectations were high for the film, some thinking that this Marvel Cinematic Universe (MCU) franchise that tends to play more like a Guardians of the Galaxy movie than an Avengers movie was going to break into a higher tier of moneymaker. This was not wholly unreasonable. after all, each Thor movie had made more than the last, with the process gone far enough that in 2022 terms Thor 3 (Thor: Ragnarok) was a billion dollar hit--its $854 million in late 2017 about $1.025 billion in summer 2022 prices. However, pulling in a mere $761 million Thor 4 actually made less in nominal terms, and a quarter less in real terms (with the fact only partially attributable to Marvel's shutout from China), and that result quite naturally received as a letdown.* Indeed, the suspicion that the movie failed to break even on its theatrical run would seem to be justified by the numbers Deadline published this month--the theatrical run bringing in $350 million, as against the $455 million spent on the production, prints and ads, and overhead and interest, while participations and residuals also had to be paid (these eventually totaling another $57 million).
Of course, there was home entertainment and streaming/TV, which came close to matching the theatrical run's earnings with another $300 million. The result was that Thor 4 still ended up with a respectable profit of $103 million.
Still, it seems worth noting that just as with Black Panther 2 this meant a halving of the profit from the last entry in the series in real terms, Thor 3 having made a profit of $174 million back in 2017 according to the same formula (which worked out to about $209 million at the time Thor 4 came out).
It is not the direction in which Disney-Marvel needed the numbers to move, in either case. Indeed, if the numbers keep moving in this direction, profitability quickly becomes nonexistent. Yet with $100 million more made than what was spent it is no franchise-killer.
* Thor 3 made about $112 million in China--about $135 million in summer 2022 terms, such that even without it, merely matching Thor 3 in the rest of the world the movie should have made about $890 million. Putting it another way, the film's non-Chinese gross dropped about 14 percent from the last Thor movie, in contrast with the increases previously seen.
Of course, there was home entertainment and streaming/TV, which came close to matching the theatrical run's earnings with another $300 million. The result was that Thor 4 still ended up with a respectable profit of $103 million.
Still, it seems worth noting that just as with Black Panther 2 this meant a halving of the profit from the last entry in the series in real terms, Thor 3 having made a profit of $174 million back in 2017 according to the same formula (which worked out to about $209 million at the time Thor 4 came out).
It is not the direction in which Disney-Marvel needed the numbers to move, in either case. Indeed, if the numbers keep moving in this direction, profitability quickly becomes nonexistent. Yet with $100 million more made than what was spent it is no franchise-killer.
* Thor 3 made about $112 million in China--about $135 million in summer 2022 terms, such that even without it, merely matching Thor 3 in the rest of the world the movie should have made about $890 million. Putting it another way, the film's non-Chinese gross dropped about 14 percent from the last Thor movie, in contrast with the increases previously seen.
2022's Where the Crawdads Sing at the Box Office
Delia Owens' novel Where the Crawdads Sing was a colossal bestseller, lasting for over three years on the New York Times hardcover fiction bestseller list. Predictably made into a film, that movie was released in the summer of 2022.
Compared with similarly successful bestsellers made into major movies--The Da Vinci Code, Twilight, Fifty Shades of Grey--this adaptation’s run in theaters seemed relatively low profile, Crawdads, in what, a very few exceptions apart (Avatar 2, Top Gun 2) was a less than booming year, failed to crack the long-since inflated $100 million barrier and finished behind such "underperforming" films as Elvis, Nope and Fantastic Beasts: The Secrets of Dumbledore at the North American box office (while doing still less well internationally).
However, according to Deadline it actually proved to be one of the more profitable films of the year, earning nearly $200 million on an outlay of $123 million (only a fifth of which was spent on the actual production) for a 61 percent "cash-on-cash return."
In doing so Crawdads was that rarity of recent years, a film made for a relatively small amount of money that--even without being a horror film or an arty critic's darling that gets heavily promoted to a wider audience (the film seems to have been as disliked by critics as it was liked by its viewers)--managed to sell millions of tickets. The result is an undeniable hit on a smaller scale (making a little less than the ill-fated Fantastic Beasts 3, but costing only a small fraction of what that movie did, so that it came out far ahead by this metric).
All the same, successful as the film was--and important the book's built-in audience was to making it a success--I find myself wondering if the modest scale of that success is not in its way suggestive of books mattering less in contemporary culture than they did just a short time earlier.
Compared with similarly successful bestsellers made into major movies--The Da Vinci Code, Twilight, Fifty Shades of Grey--this adaptation’s run in theaters seemed relatively low profile, Crawdads, in what, a very few exceptions apart (Avatar 2, Top Gun 2) was a less than booming year, failed to crack the long-since inflated $100 million barrier and finished behind such "underperforming" films as Elvis, Nope and Fantastic Beasts: The Secrets of Dumbledore at the North American box office (while doing still less well internationally).
However, according to Deadline it actually proved to be one of the more profitable films of the year, earning nearly $200 million on an outlay of $123 million (only a fifth of which was spent on the actual production) for a 61 percent "cash-on-cash return."
In doing so Crawdads was that rarity of recent years, a film made for a relatively small amount of money that--even without being a horror film or an arty critic's darling that gets heavily promoted to a wider audience (the film seems to have been as disliked by critics as it was liked by its viewers)--managed to sell millions of tickets. The result is an undeniable hit on a smaller scale (making a little less than the ill-fated Fantastic Beasts 3, but costing only a small fraction of what that movie did, so that it came out far ahead by this metric).
All the same, successful as the film was--and important the book's built-in audience was to making it a success--I find myself wondering if the modest scale of that success is not in its way suggestive of books mattering less in contemporary culture than they did just a short time earlier.
Monday, April 24, 2023
"Is Black Panther 2 a Commercial Failure?" My Last Word on the Subject (Probably)
Back when Black Panther 2 hit theaters I took up the question of the movie's commercial performance
raising the possibility that given the reports of its budget (we heard figures like $250 million tossed about), the movie was not going to make back its cost in theatrical release, even as I allowed that other revenue streams could compensate.
Deadline's recent figures suggest this thinking was not far off the mark. The backers of the movie spent some $376 million on production, prints and ads, and overhead and interest, even before participations and residuals came into the picture--which eventually came to another $60 million.
By contrast the studio made $425 million off of theatrical rentals.
The result was that, judged on even the most optimistic accounting, the film only really began to make money when non-theatrical revenue streams were counted in. Of course, when they are counted in the result is clearly a healthy profit--enough for Deadline to rank the film as one of 2022's most profitable blockbusters. Still, this is not the performance Disney-Marvel probably hoped for. (Top Gun 2, and even the far more costly Avatar 2, were profitable long before the end of their theatrical runs.)
The gap between anticipations and results is especially evident when one compares Black Panther 2 to the original Black Panther. That movie, according to the same formula, was almost twice as profitable--bringing in some $476 million in profit, as against the $259 million the sequel brought in. Adjusting the figures for inflation makes the original Black Panther look better still--its $476 million in 2018 equal to about $570 million at the time of Black Panther 2's release. This leaves the second film's mass of profit less than half that of the first film, and the margin of profitability, more or less, commensurately smaller (a "cash-on-cash" return of some 53 percent for the sequel, as against 92 percent for the original). The result is that if Disney eventually made money, a good bit of it, the result still bespeaks a path of diminishing returns that may not exactly have them rushing to green-light Black Panther 3--the more in as Black Panther 2 was scarcely out of theaters before Ant-Man 3 flopped in a manner that could leave it a money-loser, even with home entertainment and the rest going some way to making up the shortfall.
The result is that, while any movie that brings in a fifty percent profit on such a colossal outlay is absolutely no flop, it was very far from being an unmitigated success--the word "disappointment" likely not inappropriate. Meanwhile, beyond Black Panther 2 it seems to say a lot that even with streaming proving no substitute for the box office (as the retreat from high spending on for-streaming content reminds us) movies are now routinely budgeted at such a level that even movies ranking among the biggest hits fail to make back their money from ticket-buyers alone. One can take it as suggestive of the decadence of the blockbuster model, just like what we had with musicals in the ‘60s--with no successor in sight.
Deadline's recent figures suggest this thinking was not far off the mark. The backers of the movie spent some $376 million on production, prints and ads, and overhead and interest, even before participations and residuals came into the picture--which eventually came to another $60 million.
By contrast the studio made $425 million off of theatrical rentals.
The result was that, judged on even the most optimistic accounting, the film only really began to make money when non-theatrical revenue streams were counted in. Of course, when they are counted in the result is clearly a healthy profit--enough for Deadline to rank the film as one of 2022's most profitable blockbusters. Still, this is not the performance Disney-Marvel probably hoped for. (Top Gun 2, and even the far more costly Avatar 2, were profitable long before the end of their theatrical runs.)
The gap between anticipations and results is especially evident when one compares Black Panther 2 to the original Black Panther. That movie, according to the same formula, was almost twice as profitable--bringing in some $476 million in profit, as against the $259 million the sequel brought in. Adjusting the figures for inflation makes the original Black Panther look better still--its $476 million in 2018 equal to about $570 million at the time of Black Panther 2's release. This leaves the second film's mass of profit less than half that of the first film, and the margin of profitability, more or less, commensurately smaller (a "cash-on-cash" return of some 53 percent for the sequel, as against 92 percent for the original). The result is that if Disney eventually made money, a good bit of it, the result still bespeaks a path of diminishing returns that may not exactly have them rushing to green-light Black Panther 3--the more in as Black Panther 2 was scarcely out of theaters before Ant-Man 3 flopped in a manner that could leave it a money-loser, even with home entertainment and the rest going some way to making up the shortfall.
The result is that, while any movie that brings in a fifty percent profit on such a colossal outlay is absolutely no flop, it was very far from being an unmitigated success--the word "disappointment" likely not inappropriate. Meanwhile, beyond Black Panther 2 it seems to say a lot that even with streaming proving no substitute for the box office (as the retreat from high spending on for-streaming content reminds us) movies are now routinely budgeted at such a level that even movies ranking among the biggest hits fail to make back their money from ticket-buyers alone. One can take it as suggestive of the decadence of the blockbuster model, just like what we had with musicals in the ‘60s--with no successor in sight.
Deadline's List of the Most Profitable Films of 2022: Some Thoughts
Not long ago I offered some comment on Deadline's report on the most unprofitable films of 2022, as calculated not simply on the basis of production budget vs. box office, but more comprehensive information on expenditure and revenue.
It seems to me that there is also something to be said about the most profitable films, on which it also reported, presenting two lists of them--one comprised of the most profitable "blockbusters" (high-budget, high-profile, high-grossing movies) and of films overall (with the latter, going by relative profitability, more inclusive of smaller films that brought in more money in relation to their cost, even when the mass of profit was much less than that brought in by the blockbusters).
Where the blockbusters were concerned I was completely unsurprised to see Avatar 2 at the top, followed by Top Gun 2. Colossal as the investment in Avatar 2 was, so was its gross--while in the wake of James Cameron's remarks foregrounding the issue of what the film had to make in order to "break even" the entertainment press happened to note, and report, that the movie entered the territory of profitability somewhere around the $1.5 billion mark (!), after which the movie kept on making money until it hit $2.3 billion (a lot less than the original Avatar, especially in real terms, but all the same, so much that any question of disappointment is completely unreasonable). Meanwhile Top Gun 2 went far, far above and beyond expectations in such a way that its inclusion here was no less predictable. I was unsurprised to see Minions: The Rise of Gru in the #3 spot given how well it did--a comparative bright spot in what, Top Gun 2's success apart, was not exactly an impressive summer commercially.
By contrast I was more surprised to see Dr. Strange 2 and Black Panther 2 on the list, given that, while one expects Marvel Cinematic Universe (MCU) superhero movies here, and they were indeed major moneymakers by the usual standard (bringing in a combined $1.8 billion in ticket sales), there were perceptions that their grosses were not all that had been hoped for (which I argued for myself). Still, if they could have done better at the box office they were still solid earners from the standpoint of the bigger picture, at least--and reminders that if the MCU, like so many other huge franchises (James Bond, Star Wars), has passed its peak it remains a long way from being so unviable as to be given up (even if, in the wake of the disappointment of Ant-Man 3, that day may not be so far off as it seemed even a little while ago).
Meanwhile the more inclusive, relative profit-minded list of most profitable films was predictably dominated by horror films (the reboot of Scream, Black Phone, M3GAN--the latter counted as "2022" mainly because the Deadline people wanted it to be, I suppose), for if horror movies are no match for the superhero epics at the box office they still offer enough return on a low budget to be worth putting out theatrically. The two exceptions to the pattern were Where the Crawdads Sing and Everything Everywhere All at Once--the one benefiting from the colossal bestsellerdom of the book it adapted and the built-in audience it brought, while the other was one of those arthouse-type movies that end up reaching a broader audience (helped, I think, by its blockbuster-ish elements--the movie being a martial arts battle across the multiverse).
In short, as much as the blockbusters even the smaller hits have been just as predictable as the big. Indeed, as other hits, and misses, of the year indicate, the range of material that stands a chance of successful theatrical release is ever narrower, and deviation from that narrowness ever less forgiven by the Market.
It seems to me that there is also something to be said about the most profitable films, on which it also reported, presenting two lists of them--one comprised of the most profitable "blockbusters" (high-budget, high-profile, high-grossing movies) and of films overall (with the latter, going by relative profitability, more inclusive of smaller films that brought in more money in relation to their cost, even when the mass of profit was much less than that brought in by the blockbusters).
Where the blockbusters were concerned I was completely unsurprised to see Avatar 2 at the top, followed by Top Gun 2. Colossal as the investment in Avatar 2 was, so was its gross--while in the wake of James Cameron's remarks foregrounding the issue of what the film had to make in order to "break even" the entertainment press happened to note, and report, that the movie entered the territory of profitability somewhere around the $1.5 billion mark (!), after which the movie kept on making money until it hit $2.3 billion (a lot less than the original Avatar, especially in real terms, but all the same, so much that any question of disappointment is completely unreasonable). Meanwhile Top Gun 2 went far, far above and beyond expectations in such a way that its inclusion here was no less predictable. I was unsurprised to see Minions: The Rise of Gru in the #3 spot given how well it did--a comparative bright spot in what, Top Gun 2's success apart, was not exactly an impressive summer commercially.
In short, as much as the blockbusters even the smaller hits have been just as predictable as the big. Indeed, as other hits, and misses, of the year indicate, the range of material that stands a chance of successful theatrical release is ever narrower, and deviation from that narrowness ever less forgiven by the Market.
Saturday, April 22, 2023
Han Solo and Captain Kirk in Tom Clancy's Star Wars: Revisiting Tom Clancy's The Cardinal of the Kremlin as it Might Have Been.
One might add that, if they had hardly forgotten that Sean Connery was James Bond once upon a time (indeed, before the pretense that the rebooted films are the only ones that count, Connery was in fact remembered as the best of them), he appeared here as being as un-Bondian figure as one could imagine, a tweedy old professor of Medieval literature very much out of his element when shooting it out with the Nazis. (One can add that, at least according to Joseph McBride's biography of Spielberg, Spielberg got squeamish about keeping the bit about the elder Jones' affair with Elsa Schneider, and only Connery's insistence saw it retained--about which McBride quotes Connery remarking that he "didn't want [Henry Jones Sr.] to be such a wimp.")
Altogether, while it was quite possible to see James Bond-as-Indiana-Jones'-father as a sort of inside joke that did not make very much difference to most, and certainly did not turn the movie into a joke.
By contrast, it is almost impossible to see William Shatner and not think of . . . Captain Kirk, the more in as between TV, film and video gaming he not only played the character for at least four decades (which made the more impression because of Shatner's infamous impression on screen--the highly theatrical line delivery with its entirely ungrammatical dramatic pauses, the self-deprecating sense of humor), but how he has so strongly associated himself with that figure. Thus did we see William Shatner officially playing himself over and over again in episodes and even films where he appeared precisely because he had been Captain Kirk (as in 1998's indie film Swingers-for-Star Trek fans, Free Enterprise), while even when not officially playing himself he was apt to be playing off of the association with Captain Kirk somehow--all as, in his numerous non-acting public appearances, he never let us forget the connection, not least by writing, directing and starring in the documentary The Captains (2011), which is about his interviews with the other five Star Trek captains of the small and large screens. A different attitude from Connery's relationship to James Bond is harder to imagine, and depending on just how big Shatner's part would have been in the Cardinal movie it would likely have been much more remarked, and much more consequential for the viewing experience--such that looking back at this ‘90s-era idea one can only wonder, "Just what is the deal with that?"
* These days the Bond franchise's runners love hiring big-name auteur directors from all over the place to helm the movies (Marc Foster, Sam Mendes, Cary Joji Fukunaga), but back then they were a "creative producer's" show (specifically Albert R. Broccoli's show), with the directors local Brits who had often worked in prior Bond films in lower-level functions. John Glen, who helmed the five '80s-era EON Bond films (For Your Eyes Only, Octopussy, A View to a Kill, The Living Daylights and Licence to Kill), had been with the franchise since the '60s, working as editor and second unit director on On Her Majesty's Secret Service, The Spy Who Loved Me and Moonraker before getting the job.
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