PENNIES FROM KEVIN - Did Shrek Put the Nail in Disney's Coffin?
After Shrek 2 broke records this weekend, can Pixar afford to join forces with anyone but Universal? There's only one reason not to, and 129 million reasons why they should...
Written by Kevin Baxter
Shrek 2 opened big this past weekend, but few imagined exactly how big. The second-biggest three-day weekend ever with $109M, $5M short of Spider-Man's record. The largest Saturday ever with just under $45M. And the largest five-day weekend ever - even bigger than Return of the King - with a smidge under $129M.Tweet
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?
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