Written by Kevin Baxter
Published: May 26, 2004 at 1:49 AM
Think Pixar didn't notice this? The Disney-distributed Finding Nemo made $70M on its opening three-day weekend and Pixar must be wondering why Disney, the self-professed number-one marketer of family entertainment, fell $39M short of the Universal-distributed film. Sure, sequels tend to have bigger weekends than their originals, but EVERY Pixar movie's opening weekend has been bigger than the previous one. But not one of them more than doubled its take, like Shrek 2 did, and not one of them increased more than $60M. Monsters, Inc beat Toy Story 2 by a mere $5M, and Finding Nemo beat Monsters by just under $8M. Every Pixar movie has been called a "home run" by analysts, yet Disney can't seem to create a whole lot more excitement for followup projects.
Many have said Disney didn't give Nemo everything they could have, which is hard to argue against when the movie was the second-highest grosser of 2003. But when Nemo was released on DVD, it sold more on its first day than any other DVD up to that time. Why couldn't Disney make sure the film broke records when it opened in theaters? Did they undermarket? Or was their marketing campaign to blame? Something was certainly amiss.
Whatever the reason, Universal has now put Disney in a very poor light, and itself in the spotlight. Not only did Universal break records this weekend, but they actually kept the original Shrek on screens longer than Monsters in 2001, and it made more money domestically. Plus, the green monster won the Academy Award and the blue one didn't.
In fact, Disney hasn't been able to open a movie in a record-breaking category since 2001, which they did with Monsters (biggest November opening). Not that weekend-opening records are all there is, but breaking records gets you more free advertising from the media than opening at number one does. Record-breaking or not, a huge chunk of a movie's gross, especially in the summer, comes from that weekend.
How many movies has Disney opened big since that magic 2001, the same year Pearl Harbor opened big? Let's look at debuts over $35M. Disney had Monsters, Nemo and Harbor, of course. Add in Signs, Scary Movie 3, Pirates of the Caribbean, Sweet Home Alabama and Lilo & Stitch and Disney has opened eight movies really big in 3 1/2 years. In the same stretch, Universal opened Bruce Almighty, The Mummy Returns, The Hulk, 8 Mile, Jurassic Park III, 2 Fast 2 Furious, American Pie 2, Shrek, The Fast and the Furious, The Cat in the Hat, Red Dragon, The Scorpion King and this year's Van Helsing and Shrek 2, which are still going strong. Fourteen films with openings over $35M. So who exactly has the marketing might?
Even scarier is how far Disney has fallen in this category. Prior to 2001, both studios opened six films at more than $35M, yet read the last paragraph to see how both companies have fared since. Even worse, Universal has marketed four big films this year (ignoring Connie and Carla) and all four opened above $25M; Disney has also marketed four big films (ignoring The Ladykillers, Teacher's Pet and Confessions of a Drama Queen) and every last one of them opened below $20M. The Alamo grossed $20M TOTAL.
Opening weekends aren't everything of course, but people shouldn't look at Disney's record 2003 as proof of their marketing aplomb. Those numbers are seriously misleading, since if you go by what the studios actually made, then you would have to subtract almost half of Disney's Nemo take, making Warner Bros, New Line, Universal and Sony bigger earners. If you go by marketing ability, then you would have to add in the DreamWorks films Universal distributed, making it the undisputed champ. Spin it yet one more way, in average dollars per film, and New Line is the major winner, with Universal right behind.
Ignore all the math and you still have to realize that 2003 was a freak year in which Disney actually had more than one or two hit films, which is what they usually get. Universal, which has been the number one studio since the mid-90s, has only recently lost its position due to behemoths like Harry Potter and Lord of the Rings, but has still posted impressive numbers.
So Pixar has no reason to try to rework a Disney deal, right? Even if Eisner was gone from the picture? Not necessarily. Disney still owns the characters from every film Pixar has so far produced and could make sequels to any of their films whenever they feel like it. A wretched Toy Story 3 could seriously damage Pixar if too many people don't understand that Pixar had nothing to do with it. Imagine the Pixar film that opens after people become appalled at what their beloved Buzz and Woody have become. How many millions would that cost the Pixar film?
Still, Pixar can always make a future deal with Disney to produce those sequels. Personally, if I were Steve Jobs, I would gladly give Disney 30%(ish) of the profits if Disney agreed Pixar would be the only company to create sequels for those films. Pixar should be willing to take a big cut if they want to ensure their creations don't get seriously mistreated. If such a deal is undoable - and there isn't really a reason it couldn't happen since Eisner should be gone by that time - then Pixar needs to realize they need to find the company that will do the most for them in 2006. Eisner or no, Disney is not that company.
So then why is Universal that company? Sony and Warner Bros both have proven they can open films in a big way. But Pixar needs to go into the decision with the realization that they may not be the biggest animation studio out there when they break free from Disney. The two Shreks have shown how loose their grip on the top position is. If Pixar joins up with Universal, then Universal will have to make sure the animated films produced by Pixar and DreamWorks do not cannibalize each other. With someone else, that studio would be more likely to put a Pixar film up against a DreamWorks film, since that's the way these guys like to work.
Take this November as an example. Universal placed DreamWorks' Shark Tale in early November, a spot where many family films have succeeded. Disney promptly placed Pixar's The Incredibles on the same date, forcing Universal to either go to war or to retreat. Universal wisely retreated to early October. What would have happened had Shrek 2 been the DreamWorks film involved? Universal certainly wouldn't have blinked then. Would Disney change their date? Or would Disney let the two films fight it out? I think this past weekend hinted as to whom the winner would have been in that scenario. Pixar can't afford to be in that position.
Had Pixar already been in the Universal fold this year, none of this would have happened. Shrek 2 and Shark Tale would have remained in their original spots and The Incredibles could have been given a plum spot around Independence Day. And the Incredibles characters could have been all over NBC this spring, a network that viewers actually watch. Sony can't promise that. Warner Bros can't promise that. Fox can promise network exposure, but doesn't open many non-Star Wars films big.
Many think Pixar has delayed their selection process to see how the Eisner brouhaha comes out. That may be partly true. I think Pixar is also waiting to see how The Incredibles finishes the year compared to not only Shrek 2 and Shark Tale, but to Sony's Spider-Man 2 and Warner's Harry Potter as well. If either of those don't improve upon their predecessors, like Shrek 2 certainly will, expect Pixar to take that fact into serious consideration.
Then there's the theme park synergy. Yes, this is a theme park site so you had to figure I would eventually get to it. Rumors have Pixar a bit peeved that it took so long for WDW to get a Toy Story attraction, and even longer for Disneyland to get a clone of it. Then there's the highly popular Monsters, Inc, which is still unrepresented. Add the embarrassing Nemo "parade" at DCA and the half-assed Living Seas overlay at Epcot and Pixar has to be wondering if the company, both on the movie side as well as the theme park side, will ever show them any love.
Meanwhile, over at Universal, Chicken Run became a USH attraction almost immediately, and Shrek got star treatment with Shrek 4-D on both coasts less than two years after the first film debuted. Even the highly profitable Mummy movies didn't get attractions that quickly. If Universal promises some serious attractions with speedy opening dates, Pixar might start drooling all over the dotted lines before they can ever sign them.
Marketing muscle, serious synergy and quality theme park attractions... why would Pixar go anywhere else?
After that its Potter vs. Ogre.
http://www.boxofficemojo.com/franchises/chart/?id=vs-shrek.htm
Link is updated daily...
That said, let's just call it like it is: SHREK2 will rake in boat loads of money mainly because of one thing: people want to see it. Disney's marketing machine is still champ in this category....but let's be honest, how much slam-bang marketing can save films such as "Home on the Range," "The Alamo," and all that other stuff.
I bet a top-rate Finding Nemo sequel would have an impressive opening. But if it sucked, then it would sink....more later...gotta go.
Okay, in summary, I was just stressing that huge opening weekends do have a lot to do with marketing, but we can't discount people's desire to see the film either. Sure, that's what marketing is for: making people want to see a film. But a good film to market doesn't hurt either. On its merits, I have to rate Shrek (the original) slightly behind Monsters, Inc. and Finding Nemo for originality....I mean, we've had fractured fairy tales for years...but I did like the film--but not nearly to the level of Nemo. But I think it's box office gross may just come close to, if not pass up, Nemo. Why? Combine good writing with good marketing with the band-wagon factor (well, let's see this movie that everyone else is talking about). But when it comes to drumming up interest in an untested and non-sequel animated feature, Universal doesn't even come close to Disney. $70 million for Nemo's opening bow....that's remarkable, especially when compared to Shrek's (the first film's) opening weekend. It's only fair to compare the first Shrek to Nemo. If a Nemo sequel comes out, then we can see how that stacks up.
And again, Disney does a good job of keeping the film in the public's eye for MANY years to come...toys, theme park attractions (yeah, they've not fully realized the Pixar potential here, that's for sure), Pixar on Ice, Toy Story on Ice, parades and floats, etc etc etc. Then they come back years later with special releases to Imax screens. And specials on the Disney Channel, Toon Disney, ESPN, ABC, ABC Family, etc. Disney is a master marketer. I agree that their creativity has been borrowed, of late, or nonexistent. Universal ain't no second-rate pony, that's for sure, but they ditched King Kong (let's hope the new Peter Jackson movie drums up an updated Kong thrill ride) and ET because of lack of interest whereas Micky just keeps getting the royal treatment and more promotion. Disney created the Pooh nightmare (please, no more Pooh shoved down my throat) that has blossomed into a multi-billion dollar industry with little to no new creative programming.
Well, I'm done...ain't no sense in arguing. Both Disney and Universal can market their way out of a hole in the ground (hmmmm, how appropriate is that statement?). later.
Frankly, I don't WANT Disney to be making movies like "Shrek." The cynicism and crudity of its humor, design and animation is not a road I want to see Disney traveling down--although I can't help but admit that it's already doing so. No matter how successful sequels are (Shrek 3 & 4 are already in the works), they're not part of Walt Disney's standards of achievement. What I expect from Disney are great stories, great characters, beautiful and inspiring animation, and original, creative cinema. These are not the models from which branded franchises arise, and branded franchising is the sole reason that "Shrek 2" exists. It's just another piece of meat to feed the consumer marketplace. To me, it's loser culture--take whatever they throw at you and feed on it ravenously--until the next course comes along.
While success is important, measuring anything by popularity alone is hardly a measure of value to me. "Fantasia" was never a financial success in Walt Disney's lifetime. Does that mean that The Walt Disney Company would be better off without it? Is "Triplets of Belleville" a disaster because its financial take doesn't even come close to any "real" box office success? I'd be happy with a thousand films like Triplets over a single "Shrek" any day. What "Triplets of Belleville" has left with me in terms of its spirit and creativity is far more valuable and lasting than the calculated demographic chicanery of either "Shrek" OR "Finding Nemo." And I don't need a sequel or plush options to keep me in its spell.
I also take issue with this notion that success is solely determined by box office receipts. Naturally, as admission prices rise incrementally every year, the box office take is going to keep going up. It's an absurd marketing strategy by the film industry, but, beyond the short-term benefits, it doesn't make any sense. If Snow White made 8 million dollars now it would be considered a bomb, not the biggest film in history, as it was in its initial release. How many people have seen it since? Isn't THAT the standard we should be concerned with? When people report the numbers of an audience, I wish they'd include the amount of units sold i.e. per ticket or per video. It doesn't mean anything to me to hear about current box office receipts. That'll be topped next season.
If huge BO is all you want from a movie, there are plenty of stinkers to be had. That's not what I look for in a Disney film.
You bring up a long list of films with huge openings from Universal including :Bruce Almighty, The Mummy Returns, The Hulk, 8 Mile, Jurassic Park III, 2 Fast 2 Furious, American Pie 2, Shrek, The Fast and the Furious, The Cat in the Hat, Red Dragon, The Scorpion King and this year's Van Helsing. Unfortunately, the opening weekend means zilch if it doesn't make any money thereafter. Such movies as The Hulk, The Cat in the Hat, Van Helsing, Red Dragon and Scorpion King all had relatively lousy Box office totals in the end. When you consider the cost to make some of those films, most are considered to be pretty big "flops" among industry experts because they hardly came near to what it initially cost to make.
I would check some of your Box Office facts before writing such an article as the one above. If you look over the past 10 or so years, Disney has actually been the number 1 studio for most of them and last year was not a "rare" win. Universal has rarely held that top spot and appears will not reach that spot again this year. You must realize again that Shrek IS NOT from Universal and has no effect on Universal's studio totals. The only relation Unviersal has with Shrek is the rights for an attraction. The same way they have rights to make attractions to Twister, Spiderman, Terminator, etc. None of these movies/brands were made or distributed by Universal, but the attractions based on them are at their parks.
As for the Shrek vs Nemo comparison, there are a lot of factors besides "marketing" that led to Nemo making over 70 million and Shrek 2 over 108 in its opening weekend. Such things as Nemo not having a built in fan base or the number of theaters it opened in. Nemo opened in 3,374 theaters while Shrek opened in a record for any movie with 4,163 theaters...about 790 theaters more than Nemo. Don't think that makes a difference, compare the per theater average for each during its opening weekend. Nemo had a per theater average of $20,821 and Shrek 2 an average $25,951 per theater. When you consider Shrek's built-in audience, it doesn't look as impressive now, does it?
I can only imagine that Disney will try, if given the chance, to come close to that theater number with the Incredibles.
I mean no offense, just trying to establish the facts here. May I suggest checking a great site for box office info before writing another article like this that obviously has very little credibilty. Try www.boxofficemojo.com. Its a great site for this type of stuff.
And for last year, if you take Nemo completely out of Disney's BO take, Disney still would in a "statistical tie" with Sony for first place.
There is no denying Disney has hit some tough spots this year. Major films like Hidalgo and Alamo literally flopped worse than one could have imagined. But they still have some potential big guns including King Arthur, The Village from M. Night Shylaman (Signs, Sixth Sense director/writer), the sequal to the already popular Princess Diaries, and of course, The Incredibles this fall that might just help to balance this year's big blows thus far.
And Seagram's ownership truly sucked. 1998 had Universal distributing a whopping 16 films and making $392M. Sad. Vivendi's ownership did have a positive effect, as 1999 showed a 138% increase for Universal. Still, overall Disney did manage to scrape out a win when averages are totaled, though averages were greatly affected by three really big movies, Tarzan, Sixth Sense and Toy Story 2.
2000 is when things started to shift. Disney once again was on top in total revenue, but by a mere $12M, and they had to release three more movies than Universal to get that dubious victory. But Universal still didn't get the title in the all-important average revenue category, which was won by DreamWorks. Which were distributed by UNIVERSAL. Clearly the big winner of 2000.
2001 brings a bit of a problem since I can't find out how many films each studio released. Warner Bros grossed the most, but they consistently release more movies than Universal, which came in second. Disney was back in third, with a bunch of releases, I am sure. Plus, this doesn't include the major money Universal dragged in for Shrek.
2002 was a weird year overall. With Vivendi's problems starting, Universal went cheap and had fewer releases and cheaper ones at that. Still, the four studios at the top were once again the four that always release the most films. So 2002 would have to go to New Line, who finished just above Universal and released fewer films.
2003 was another alleged win for Disney, but once again the real winner was New Line, who had a major profit margin. As did Universal. And that is basically what I am attempting to get at. Take away the numbers that don't mean anything and Universal has been the most consistently profitable studio out there for the past five years. Even the year they went cheap turned into a good year for the company.
And, yes, how long movies stay in the theaters is important, but that fact has little to do with the studio releasing it and almost everything to do with the film itself. There is so much competition out there now that opening weekends ARE almost as important, if not more so, than total take. Word-of-mouth hits are very few and far between nowadays, since there is always something new out there to steal the focus of a deserving film. Studios cannot rely on that and must open big. Disney doesn't open films big very often. Universal does.
Jeff, I've seen Shrek EVERYWHERE? Do you live in the US? Gawd, he's on everything I eat and drink and might even be on my toilet paper. Plus, Disney doesn't make the toys itself, but licenses out the characters. Pixar can do that quite well without them.
THC, I too wonder about S2's total take. I didn't think it would, even after the huge weekend, but exit polls have like 70% saying they would see it again. That's major. Plus, it has continued very strong throughout the week, and kids are still in school. It should easily beat the dumber-than-dirt-looking Day after Tomorrow, and will probably end the weekend in the $250M range. That would easily get it past Nemo, not that I think it deserves to.
And that gets me back to the opening grosses. Had Nemo opened like S2, it would be untouchable. I wasn't impressed in the slightest with Disney's marketing campaign for the film. I wasn't with Universal's for S2 either, but the marketing blitzkrieg was certainly impressive.
I don't think HP will hurt S2 much. S2 will get a lot of childless adults, who don't rush out first weekend, and childless adults aren't much interested in the boy wizard. Some analysts don't think this HP will top the last one. We shall see.
Philip... I mentioned the other choices Pixar faces. But I clearly pointed out that DreamWorks will be their biggest competitor and joining Universal keeps that competition to a minimum. Sony cannot promise that. Fox cannot promise that. Warner Bros cannot promise that. Only Universal can. After marketing might, reducing that competition should be the most important factor in Pixar's decision.
Robert O... I already stated why opening grosses are important in the last post. But I repeat that longevity is due to the film and not the studio. But you are right on that Disney doesn't have anything to save them this year. The Incredibles is no sure thing, and they only get half of that, and The Village's period look may seriously hurt it. Remember that Shyamalan's second film, the one right after Sixth Sense wasn't a blockbuster. The rest look bad.
J Dana... I have to disagree. Shrek was EVERYWHERE, which is what made people rush out to see it. You can make people want to see a movie, but it takes a special push to make people want to see it on its opening weekend. I also think being a sequel helped, but there is absolutely no reason in the world Nemo should have opened with a mere $8M more than the hugely successful Monsters. As far as I'm concerned, that was incompetent marketing. Disney's marketing machine is champ? Anything but. Van Helsing opened to far worse reviews than any Disney movie this year, yet still opened bigger than all of them.
Also, I don't think comparing the original Shrek to Nemo is the slightest bit fair. Shrek had Antz as its only predecessor and PDI hasn't built up a brand name. Nemo had two Toy Storys, Monsters and Bug's Life, all of which were highly successful. Nemo may not have been a sequel, but it was certainly seen as a followup, something Shrek was not viewed as.
In fact, a better comparison would be the original Shrek to Monsters, since both were released in the same year. Disney opened Monsters bigger than Shrek, but Shrek is the one that held on longer. Monsters ended up doing better globally (though not by leaps and bounds) but that was once again due to the Pixar name. It will be interesting how Shrek 2 does overseas.
As for how long Disney holds onto these properties... I actually find this to be the WORST thing about Disney. I have pretty much lost any love I had for Ariel, Belle and their ilk simply because Disney won't let them every get to the point where we can think of them nostalgically. Disney has turned all of its popular properties into the real-world version of the It's a Small World theme. There is such a thing as overkill. Which might explain why the always-marketing Disney isn't Number One in DVD sales - Time Warner is.
Fortunately, this overkill hasn't happened to the Pixar characters. Unfortunately, Disney seems to treat them like redheaded stepchildren. If Shrek was at Disney, would we have a Shrek attraction yet? Please!
David... no one is saying Nemo wasn't a success. I do believe it succeeded on its own merits and Disney didn't do a whole lot to help it along. It certainly helped that last summer had so many awful movies. Had it been better, would Nemo have made as much? That's why big openings are important.
Maybe you'd be happy with a thousand Triplets, but I can assure you Pixar wouldn't be. This column wasn't about quality but how much money the company can make. With one movie a year, Pixar needs each one to do extremely well. What the Shrek rant has to do with anything anyone has said here is beyond me.
Matt... obviously you missed the main point of my article. Very early on I called it the Universal-distributed Shrek 2. That's pretty self-explanatory. Universal distributes and markets all of DreamWorks' films. DreamWorks produces their films, they don't distribute. Just like Disney doesn't produce the Pixar films, just distributes them.
As for checking box office facts, I suggest you do so. While I answered a lot in my previous post, there is still plenty more. You named five films that didn't make back their money. Scorpion King and Red Dragon both made back more than their budgets. And Van Helsing is still in theaters so it is a little early to start up the funeral dirge for it. But it is doing far better overseas and has already made $60M over its budget, which should cover marketing costs. In fact, only Cat didn't perform well overseas, but it still made about $30M over budget, so it lost very little, and undoubtedly will end up making a lot when DVD sales are added in. In fact, you helped me realize ANOTHER reason why big opening weekends are important. They can be used in advertising overseas.
But look over the last couple years and which studio has had more big-budget (over $50M budget) flops? And we're talking flops and not movies that grossed in the area of their budgets on the global market. Universal has had three - The Life of David Gale, The Rundown & Peter Pan. Disney has had six - Bad Company, Reign of Fire, Treasure Planet, Home on the Range, The Alamo and Hidalgo - but this doesn't include some films, like Cold Creek Manor which probably came in at more than $50M but Disney budgets are often a closely guarded secret. (I wonder why that is??!?!?!)
So Disney had twice as many flops. But that isn't all. The Rundown and David Gale weren't released overseas and lost $40M and $30M respectively, not counting marketing costs. Pan actually just made its budget globally, but marketing undoubtedly killed it. Hidalgo did practically the same as Pan and, as such, performed the best of the true flops. Bad Company lost about $40M, and it is the only flop that compares favorably to Universal. Reign and Home lost more than $50M apiece. Treasure lost more than $60M. And Alamo lost almost $80M!
As for the per-screen average not being as impressive... you are on crack! S2's average was 25% higher than Nemo's. That is hellaciously impressive. Furthermore, Monsters opened with a $19,332 per screen average, so Disney only improved Nemo's take by a mere $1500 per screen from a highly popular film. Toy Story 2, which was a known quantity, opened with a $17,735 per screen average. Monsters improved greatly upon A SEQUEL, so why didn't Nemo, which got much better reviews, improve greatly upon Monsters? You can't ignore that something is seriously wrong there.
Beyond that, the number of theaters is another testament to Universal's spectacular marketing prowess. Had S2 opened in June, like Nemo, there wouldn't have been as many screens available. Universal - and Universal alone - is the reason "summer" now starts in early May. No studio dared open a tentpole film before Memorial Day, but Universal did just that with the first Mummy, and reaped the rewards by opening on a bunch of screens which are more readily available after a slow spring. Disney, on the other hand, likes to open tentpoles in the thick of things, thinking they will rule the roost. Sometimes they do. Often they do not. And I think King Arthur, 80 Days and possibly even the hard-to-market Village may end up further proving my point. I would not be surprised to find all the biggies doing better than Disney this year. And that's not just in the unimportant overall take, but in the numbers that really count too.
The only problem I have with that explanation is, at least to my knowledge, Universal again DOES NOT distribute Dreamworks' films and so basically this is all a theory IF Universal did distribute their films. Could I be wrong? Sure. But please prove it. To my knowledge, Dreamworks is its own, full-fledge studio and not a subsidary of Universal. I'll let this go if you can prove to me beyond a shadow of a doubt that Universal distributes Dreamworks' films. All published articles/figures/facts/creditsindicate Dreamworks not only produces but ALSO distributes their own films, including Shrek and every other film under the Dreamworks title. In fact, I thought maybe it was like a Miramax/Disney thing where the movies are released under the Miramax name and are kept separate from Disney's totals from Touchstone and Walt Disney Pictures but are still distributed by Buena Vista, but there is no indication at any NBC-Universal company site that I (quickly) glanced over that even gives the slightest indication that Universal distributes Dreamworks film in even this manner. (And by the way, under the current agreement, Disney DOES produce 50% of all Pixar films and also distributes them, retaining 50% of the profits. One of the reasons for Pixar leaving is that they wanted an agreement where they produce 100% of the films, keep 100% of the profits and give Disney a simple 10-15% distribution fee)
Your original argument seemed to be solely based on domestic totals...if you start bringing in international and video sales now, it does paint a different picture. But nowhere near a scenario that portrays Universal as an almighty power and Disney as a quivering weakling.
I don't know if you realize this or not, but the studios themselves, in VERY general terms, only get back 50% of a movie's box office take from the box office. Thus, to turn a profit, it needs to make, again in general, 50% more than its combined marketing and production costs. You say I should check my facts because I'm on "crack"...let's go: Take Red Dragon for instance, its total production and marketing (US) was about $ 108 million. Thus to turn a profit, at least 216 million needed to be made first and then after that point profit could be made. Domestic and international gross for Red Dragon reached only $209 million, 7 million shy of a profit making point...but this is just a generalization.
Let's do this for Scorpion King. Total cost: $95 million. Profit point: $190 Total take (both domestic and internation): $164 million, 26 million shy of profit point.
Van Helsing: Total cost:$210 million. Profit point: $420 million. Total take up to now: $222 million. Still 200 million shy of profit point and its quickly fading from domestic theaters and has opened already in nearly all major markets and is fading there likewise (I know Japan is still left among some others). VH is considered by many in the industry to be a "flop" in every way. Not only is it falling well short of profit potential, its lousy BO has put a hold on Universal's plans to exploit VH as much as it could. The once rumored attraction for it has apparently been cancelled, the TV show Transylvania that was to be inspired by it has been cancelled by NBC before it even began and there is no indication that any sequels or franchise will be built around it as Universal publicly declared as being reasons for approving such a lofty budget for this film.
I could do the exact same cost/profit thing for Disney films and you'd soon realize that in fact a lot of movies don't make a profit in the theaters....usually that comes after video sales.
I'm not a fan of people taking such defensive tones when someone questions their "facts" to go as far to say someone is on "crack". Just prove it, please, and that will go a lot further. I realize I'm putting you on the spot for your credibility and also realize I could be wrong. If I am, let me offer my sincerest apologies now for questioning you. But I still don't no where you got the idea that Universal distributes Dreamworks films beyond the fact that Shrek is an attraction at Universal theme parks. I just can't find that studio connection anywhere else...feel free to show me and teach me something that I was unaware of. I'm quite interested to see that what I believed was really wrong.
HE WRITES: "Still, Pixar can always make a future deal with Disney to produce those sequels."
This from today's CBS Marketwatch:
This embattled Walt Disney Co. got a boost Thursday from Merrill Lynch. The giant securities firm recently held a question-and-answer session with Chief Executive Michael Eisner and concluded that Disney's prospects are improving.
The conversation Wednesday with Eisner, who relinquished his title of chairman following Disney's contentious annual shareholder meeting on March 3 in Philadelphia, yielded such findings as a recognition that Disney's crucial theme park business "is beginning to significantly benefit from its most recent capital spending cycle," said Merrill media analyst Jessica Reif Cohen in an investment report.
HERE IT COMES:
Further, Eisner told Merrill that Disney is working with Pixar on sequels to such highly successful animated movies as "Monsters Inc." and "A Bug's Life."
Wow! Mr. Baxter called it well before it was announced.
Of course this is all bad news for the saveROYdisney crowd. The mere hint of Disney signing a limited sequel deal with Pixar caused Merril Lynch to give a positive report on the company's prospects. If they actually sign a deal the positive ramifications on Wall Street will certainly help the compay and its "embattled CEO."
Its ironic isn't it? The report is positive for Mr. Baxter because it proves his smarts and it's positive for Mr. Eisner because it improves the price of his compay's stock and his own political standing.
It's nice to see that Kevin and Michael have something they can celebrate together! :o)
In late 2003, the companies announced that they would extend again their deal under which Universal would hold international theatrical distribution rights and worldwide home video distribution rights to DreamWorks' live action and animated motion pictures.
The two also often co-produce films, but Shrek 2 is a co-production of DreamWorks and PDI. Dreamworks Distribution is handling the domestic (U.S.) theatrical distribution of the film, near as I can tell.
Thus, why was this article even written? As I thought, Shrek has NOTHING to do with Universal or its opening weekend or its marketing, essentially nullifying this whole debate since the basic premise doesn't even exist (That is, Universal distributing Shrek). I think the readers of this site are owed a "correction" to this bogus assesment (if what I believe about Shrek's distribution is correct). If not, where does the credibility for this author and the site go when such wrong assertions are made as facts? If someone can prove otherwise, I offer my apologies.
The fact that Universal holds international distribution rights is not odd. Its not uncommon for a movie to be released internationally under a different studio than the domestic distribution. Heck, Buena Vista (Disney) did the international distribution of Universal's biggest movie last year, Bruce Almighty.
The sequel thing under Disney and Pixar is quite old news. Under the contract that still exists, Disney can either a) make their own sequels to Pixar films withOUT Pixar or b) they can do sequels with Pixar.....it all really depends on whether Pixar wants to make those sequels or not. If they don't, Disney has all rights to go ahead and do it themselves if they want. A comment on Pixar being involved in sequel planning does not surprise me...but I'm glad to hear its working towards that. And for all we know, there is a lot of talk that Pixar really wants to be with Disney rather than any other company and talks MIGHT re-open soon.
I RESPOND: I have no doubt that it doesn't surprise you. Further, I have no doubt that it doesn't surprise Mr. Baxter. Having said this, I would assert that (surprised or not) ANY Disney-Pixar contract sends a positive vibe through Wall Street.
I have no doubt some will charactize such an annoucement is typical and "no big deal." But if last February's breakdown between Disney and Pixar produced bad ink for Mr. Eisner, certainly it is by no means unreasonable to assert that a new Disney-Pixar deal would have a positive impact on the standing of the company's CEO.
Certainly Merril Lynch thinks so.
On another ironic note, if Pixar jumps back in bed with Disney it sort of makes the saveROYdisney.com crowd look rather weak. Just a couple of weeks ago, Stanly Gold told Business Week that Steve Jobs tops his list of potential successors to Eisner. Seems rather comical that the man Gold wants to takeover the company is suddenly ready to shake hands with the guy Gold wants to axe.
(Insert Smirk).
Once again, congratulations to Mr. Baxter for predicting the Pixar-Disney sequel agreement.
You go boy!
Further, I agree that studios other than Disney have demonstrated their ability to promote and distribute family-friendly animated films. Perhaps we should add DreamWorks to the list of potential partners for Pixar. (Way too many "p"s there, I know.)
I guess it just seemed to me that in yet another attempt to put Disney down and make Universal shine that the author, possibly unknown to him at the time, made up a scenario that does not exist at all. However, when "questioned" he put his credibility as a writer, be it opinion and/or for entertainment purposes only, on the line by not addressing it appropriately. When I re-read what I wrote, I realize it may sound like I'm some type of real jerk, but really, I'm not. Just trying to establish the truth. I hope no hard feelings.
Back to Pixar though...The truth is, despite calling off talks, its quite apparent that Pixar WANTS to stay with Disney...just not really with Eisner there. They want Disney's name and family-friendly image and everything else that is conjured up when the name "Disney" is spoken. After all, its worked wonders thus far. The behind-the-scenes mess and corporate struggles go un-noticed by many in the general public and Disney is still all about what it always was to most people.
And on that note, I also believe that Pixar shares this desire with many, many people who frequent this site.
As for the distribution deal, I have discovered a few interesting tidbits. Universal distributed the original, from what I can find, but domestic distribution does seem to have switched to DreamWorks. BUT, DreamWorks uses Universal's distribution machinery and pays Universal upwards of $60M a year for the pleasure (as Business Week claims). I'm sure that price went up dramatically for a major distribution nightmare like S2. Not that this totally clears everything up, since we don't exactly what this deal entails. My guess... Universal is clearly doing all the distribution, since it is their system and their employees, but DreamWorks "manages" the process. So I basically stick with my argument since Pixar would probably want a similar role in the distribution of its films.
The thing I also learned is that international distribution isn't done solely by Universal, but by a company co-owned by Universal and Paramount. Which may explain why Buena Vista is more of a force globally. Like I said, we'll see how S2 does overseas.
Speaking of domestic VS international, those flops I named WERE from overall BO. Some Disney films were totally saved by their foreign releases. Domestic losers like Haunted Mansion and Brother Bear actually ended up making money after being released overseas. Universal rarely needs the foreign market to help its releases, and its foreign take is usually for profit purposes.
But your math is more than a little fuzzy. You say a film needs to make 50% more than its budget (production plus marketing) to make a profit, yet the numbers you float for profit points are all 100% higher than the production budget. Besides, that 50% take of the profit is really no longer true. In the first week of a film's run, the studio tends to get 80% of the take. The longer a film stays in the theaters, the lower the studio's percentage, but then that percentage is for less money too. So studios tend to make closer to 70% of the actual take (not counting the funny accounting methods Hollywood is famous for), especially summer movies, which don't often stay longer than a month. Films that make less of a percentage of the gross do so mostly because of backend deals. If a Tom Cruise or a Steven Spielberg takes a percentage of the gross, then it will definitely be closer to the 50%. Stephen Sommers and Hugh Jackman certainly don't have the clout for such a backend deal on Van Helsing.
But noticed I mentioned FLOPS. Of which Van Helsing certainly doesn't qualify. It made more than $15M domestically last week, which is far from dead. It has also only been open in a few countries for two weeks and hasn't opened in biggies like Japan yet. I doubt it will make money until it hits DVD, but it is anything but a flop. No movie that makes $100M domestically can be considered a flop. Disappointment, most assuredly, but that reflects its take compared to its budget. And that lies completely at Stephen Sommers' feet for making such a dreadful film. Though Universal does deserve scorn for hiring Sommers again, but my point has nothing to do with creative content but how well the studios market. Universal opened it big and has kept it somewhat alive, even with dreadful reviews and mediocre word-of-mouth. Had Universal not opened it so big, it most likely wouldn't have made that $100M, and then it would have been a flop. Universal's marketing machine is the only party involved here that deserves credit.
Yes, I do realize many movies don't make profits in theaters, at least according to studio accountants. Which is why that opening weekend is so important. I don't like the hype and hooplah about that weekend anymore than most people, but that is what our disposable film business has become. Open big when the studios make the most from the theaters, then go on to the next film.
As for my "on crack" comment... I didn't suggest you were on crack because of your facts, but because you tried - lamely - to insinuate that S2's per-screen average was unimpressive. Let's compare it to other recent blockbusters. Passion of the Christ opened with a $27,557 PSA. Only $1606 more than S2. Return of the King had a $19,613 PSA, though that is a bit misleading since a lot of nerds made its Wednesday opening really big. Still, The Two Towers only opened with $17,120 per screen, so S2's take is looking more and more impressive, no?
As for the whole new Pixar/Disney deal. I knew it would happen. As much as Disney threatened to do it themselves, they don't have the technology to make a sequel to a Pixar film that will look anything like a Pixar film. Which would make it a little hard when it came to trailers and commercials. And Pixar really does not want their beloved characters treated like Disney has treated their classic characters.
Still, this doesn't mean Pixar should or will jump back into bed with Disney. Disney doesn't open films as well as Universal, Warner Bros or Fox. The biggest openings list is littered with these company names, and Disney doesn't have one in the Top 10. Sony, one of Pixar's possible choices, has the biggest, but that's the only one up very high.
Although I didn't much care for Bug's Life and thought the Boo-free portions of Monsters, Inc way too sitcommy, I love Pixar and want to see them do well when they leave Disney. I don't have a particular love for Universal's film division, but I truly do believe they have the best domestic distribution machine and their foreign machine is getting better. But I have to repeat again, since this is getting overlooked, that Universal offers them the least competition. Even though it looks like DreamWorks will decide upon its own distribution schedule, DreamWorks and Universal have a great working relationship which will continue until at least 2010. As such, Pixar will not have to compete against what will be either the Number One or Number Two animation unit. Which could be very important if DreamWorks Animation plans on releasing TWO films a year. Eisner won't be head of Disney by that time, but that doesn't mean Disney won't continue playing chicken with DreamWorks releases. Even better, if Pixar is away from Disney, they can release their movies whenever Disney releases theirs, which might effectively kill off one of its competitors. These are things Pixar needs to remember whenever they think about going back to Disney.
All I'm saying is that if Mr. Eisner manages to sign a contract with Pixar it will have a positive impact on Wall Street and a positive impact on his standing as CEO.
A movie that makes 100 million at the BO has, for years, been considered a hit at the box office. In recent years, this definition of a "hit" has changed dramatically as not only are ticket prices much higher than before, artificially inflating BO numbers in comparison, but movies themselves are also costing a lot more. Thus a "hit" vs a "flop" is based more on just whether it makes 100 million or not.
It IS a very relative thing, but an important consideration when trying to convey studio power. Universal has demonstrated this to a tee.
In the past year, Universal has released three films that not only disappointed in producing even the most modest expectations, but could easily be considered a "flop" when certain things are taken into account. The Hulk, Cat in the Hat and now Van Helsing were big guns that Universal not only spent excessive budgets on, but they also were the planned springboards for long-term plans of sequels, franchises and other profit-oriented spin-offs that they used to justify their initial investment. However, the "disappointing" box office take has essentially stopped all such future planning. When you consider all that could have been and all that was planned for these films which "disappointed", I think one could call them a "flop".
I can see where Mr. Baxter might be going with this angle though. Universal does demonstrate a great marketing ability for a long time. So much as to *sometimes* trick people into the theaters on the first weekend before anyone knows how bad the films they are producing truly are. Once word gets out, no marketing ability can save them from disappointing.
As for the 50% studio take, I tried to emphasize before that it was a BIG generalization that I was making...which often holds true and is still used by quite a few folks. There are certain cases where distributors/producers or what have you set other conditions, such as the 80% take for the first weekend or so and then dropping that percent from there on out, but that is not the norm nor the "general" rule, to my knowledge.
It is obvious that Mr. Baxter (can I call you Kevin?) has a lot of knowledgable background with Box Office stats that I initially took for granted when I read the above article that seemed so far from the truth. No hard feelings, right?
That aside, I have stated elsewhere on the site that I don't think total BO take is a fair assumption of a studio's ability. Disney could be compared to Warner and Sony, since all toss out the same number of movies (give or take one) every year to see what sticks. Universal doesn't.
Which could be yet another reason Universal would be the studio to go with. Some have questioned whether Disney's heavy spring slate caused the company to undermarket all the films. It's definitely a possibility. I know I have seen more ads for 80 Days than I had for any of those films.
But back to flops. I know the media has decided that if a movie which is expected to be a tentpole doesn't do boffo BO, then people like calling it a flop or a bomb. But this is from the same people who refuse to acknowledge that Gone with the Wind is the biggest movie of all time, so they really shouldn't be listened to. Hollywood types NEED things to be in black and white so they make a more interesting story. "The Hulk Doesn't Do Very Well!" isn't much of a headline, is it?
But that's all beside the point. My focus is on how a studio opens a film. Its first two weeks. Like I said, if a movie lasts, it's not because the studio is doing much; it's because word of mouth is good. That's why the original Shrek outlasted Monster's. This is especially important for a studio like Pixar that produces one film a year. They need to reap what they can in those profit-heavy first weeks. Of course, they will make loads from DVDs, but this is a company who has stock market problems when there isn't a new film or new DVD out. If they can't make a profit when their films hit the theaters, they will end up with three very problematic quarters.
So Universal should be the company they seek. At least for domestic distribution and theme park presence. Which really is the most important thing, isn't it? They could always choose Disney for international distribution, since the Disney name still holds a lot of cachet overseas. Unlike in the US, where Eisner has taken advantage of us too many times.
p.s sorry for any typos
The summer movie scene is not looking good.
Anyhow, I think my premises are still valid:
1 - Disney doesn't open movies well domestically anymore; Universal does.
2 - Disney did not do right by Finding Nemo's marketing campaign, which should have opened much better than it did, after Monsters, Inc's success. Some have hinted Eisner wanted Nemo to fail, to show Pixar who was boss. At the very least, Eisner bragged publicly that Pixar was about to get their comeuppance prior to Nemo opening. This should never be forgotten.
3 - Working with Universal would make it more likely that the Number One and Number Two animation studios (Pixar and DreamWorks, though not necessarily respectively) would not be fighting it out in the marketplace.
4 - Domestically, Universal has the best track record of the last five years. Sony, Fox, Warner Bros and Disney haven't been nearly as consistent.
5 - If Pixar does want theme park synergy, Universal would be far more likely to produce than Disney has.
Still, I think there are a couple more bright spots for the summer movie season. The third film in the ‘Ju-On’ series is due in July. Love creepy Japanese films. Also ‘The Terminal’ looks like it has enormous potential. There’s remake of ‘The Manchurian Candidate’ in July.
The buzz on HP3 is incrediblly positive:
Harry Knowles’ own review calls HP3 the “first genuinely great Summer 2004 film (this AFTER he had seen 'Troy' and 'Shrek 2') He continues: "In a magic world of real magic, it’s the little things that could be done that terrify, dazzle and enchant. Combining the magic of the really real, the nearly real and power of pixels, Cuaron brings to life J. K. Rowling’s Harry Potter in a way we have yet to see fully before”
Another AICN review: “I can say that while it isn't the absolute perfect adaptation, it's by far the one film of the series that has hit closest to the bulls eye. Cuaron's gift in directing actors is a large, large part of the success of the film. His standards as far as CGI effects are higher than Columbus' ever was and that makes for a much more realistic world.”
Some Muggle reviews: “Hey Harry, just saw a nice Sunday afternoon advance of Harry Potter 3, and I can happily say that it is a great flick, as well as a gorgeous film.”
Another: “And what a difference a Cuaron makes! From virtually frame one, you can tell that master Cuaron is a director with a vision, someone who thinks about where to place his camera, and is always interested in involving and surprising the audience.”
As for AICN... a review from them holds as much weight as a review from Helen Keller. They're good for releasing insider info and that is it.
The Terminal definitely has an interesting trailer for such a questionable premise. There are a few other possibilities out there too. Two Brothers could coast on the cuteness of the tigers. Dodgeball could be stupid fun. Same with White Chicks. The Bourne Supremacy will probably be a good popcorn movie, but still on the fence about I, Robot.
In fact, after June is when things start getting scary. The Manchurian Candidate is my all-time favorite movie so I am NOT happy they remade it. Any film on the AFI Top 100 should NEVER be remade. Period. Catwoman looks stupid. The Village has some bad early buzz. Then we are into August where things start looking really bad. Sigh...
Shrek 2 was Number One yet again and will be around the $250M I predicted after the holiday weekend is over. It might break the record for biggest Memorial Day weekend total, and it's in its second week. I don't see any movie touching it this year.
The big surprise is how well the moronic-looking Day after Tomorrow did. About $70M. It seems everyone can open a dumbass movie BUT Disney.
"What's more, Eisner told Merrill that Disney is working on sequels to blockbuster animated movies like 'Monsters, Inc.' and 'A Bug's Life.'"
Nowhere does this say that Disney is working WITH PIXAR on these sequels. So I went on a little search and found a story on Reuters that had this to say:
"Addressing the issue of Disney-produced sequels during his company's fourth-quarter earnings call in February, Jobs was blunt about his feelings on the subject. "We feel sick about Disney doing sequels because if you look at the quality of their sequels ... it's been pretty embarrassing," Jobs said, citing such examples as Disney's recent sequels to 'Peter Pan' and 'The Lion King.'"
Even better, the article goes into more detail about what the Merrill Lynch analyst had to say: "The unproven writing and graphics quality of Disney's work with computer-guided-image animation may have an unintentional 'contagion' impact since consumers may subconsciously associate these films as Pixar product," Reif Cohen said in a report issued Thursday. "In addition, too many releases may fatigue CGI's scarcity value, which has created consumer intrigue for this 'event' animation format."
Even the analyst knows the Disney sequels will suck! LOL! Supposedly there is more of a rush since Disney sees what the number 2 did when it was put after Shrek, and they see major dollar signs for their 2's.
The most interesting part of this is the two films Disney picked. Even Disney knew they would be in trouble trying to follow up Nemo or the Toy Story films, so they picked the two less-loved Pixar films. They probably think ruining one or both of these films would get Pixar right back on board, which it very well could.
How pathetic are you as a CEO if you need to threaten people with your own mediocrity to make them work with you?
Still I am wondering why he neglected to point out that (as is indicated by the CBS Marketwatch article) that those lousy Disney sequels managed to generate "more than "$1 billion of cash flow to date."
Hmmm.
But I digress and would prefer to learn from Mr. Baxter's insight. Perhaps he can enlighten us and tell us when he expects Disney stock prices to drop into the teens -- as he has predicted previously.
Now tell us all, without dancing around the subject, how you think Disney sequels to Pixar films will turn out.
Ford makes bad cars. They know it. They cover it by using the slogan "Quality is Job #1" even though Consumer Reports proves otherwise. They use this slogan to blatantly attempt to distract comsumers and brainwash them by innundating them with a slogan that convinces them of the opposite of the truth. THEN, they argue that their cars must be good because they're #1 in sales.
Ah, but they don't tell you this incorporates FLEET sales and all the government accounts who are often required to buy domestic as part of some union-forced agreement. Ever see a government agency with predominantly foreign cars? Hell no. Foreign cars are few and far between when it comes to government motor pools or corporate fleets.
This being the case, the argument "But we brought in a lot of money" is weak and veils the truth.
Yes Mr. TH Creative, the interests you defend ( and I assume profit from personally? ) did make a lot of money, but only because of various marketting deals that left retailers with tons us tasteless and unsold merchandise.
...but this isn't your problem, is it? You made your money, and it's the retailers fault for not moving the trinkets for the uninspiring movies you support, right?
I think Pixar needs to examine how much they make from selling toys before going anywhere else. When was the last time you saw a Shrek doll?