Theatrical moviegoing last year hit an all-time record in both the U.S./Canada ($11.85 billion) and around the globe ($41.7B) according to ComScore today, but of course, no major studio is perfect.
The industry continues to be lopsided with Disney reaping all the spoils notching an industry high of $3B stateside and a 26% market share out-distancing the No. 2 competition Warner Bros by $1.07 billion in ticket sales. Intensity remains high for all the majors to deliver events that will catapult people out of their homes in a competitive streaming world. As one major studio marketing executive has exclaimed the prevailing philosophy is “Please come to the movies, period. And if you do, it would be nice if you choose my movie.” While many are apt to be happy with this year’s industry success, no one is taking it for granted. Netflix and other streaming services have made a run on once vibrant cash cow theatrical sectors such as comedies, drama thrillers (Bird Box clocked 45M-plus views over the holiday stretch) and the independent movie awards season space with their contender Roma, which counts three Golden Globe nominations including best director Alfonso Cuaron.
Here’s our annual domestic box office review of what went right and wrong for the majors and mini-majors. 2018 beat 2016’s domestic record of $11.38B by 4%. The previous global high was 2017 at $40.6B; last year beating that number by 2.4%. Nancy Tartaglione will be delivering the final overseas and global results tomorrow. Note the domestic figures below, derived from ComScore, do not include the studio’s sister classic labels. Many majors have attempted to include their classic label B.O. to puff up their rankings. We’re not doing that here.
No. 1: Disney ($3.09 billion, +28% vs. 2017)
What went right: Of course, brands like Marvel and Pixar, but more than that, the studio continued to make compelling, genre-defying films that spoke to critics and the masses. Winning over both is integral to the studio’s success. Black Panther was a great spy movie and a celebration of diversity. Avengers: Infinity War broke the tentpole mold by making its lead character the bad guy, Thanos, with a Shakespearean tragic hero spin, not to mention it served up the best cliffhanger since Star Wars: The Empire Strikes Back. Being the box office leader with a new industry record of $3B allows Disney to make ambitious risky movies like the Byzantine A Wrinkle in Time, even if they crash.
What went wrong and what they need to do: The studio can’t assume that the Disney brand alone is Teflon, and that it will continually bail them out. Moviegoers are discerning. Last year goes down as the time when Solo put their Star Wars movie machine on pause, and Disney shouldn’t give up on making more titles in the franchise. Solo failed on its own for myriad reasons including Alden Ehrenreich lacking the looks of a young Harrison Ford and the fanboy blow back after Lucasfilm divorced itself midway through production from cult fave directors Phil Lord and Christoper Miller. Best for the studio to know who they’re hiring from the onset, commit to them and avoid public family fights which can cost a lucrative property. The studio has development deals in place with Rian Johnson to build a new Star Wars universe as well as Game of Thrones creators David Benioff and D.B. Weiss. Perhaps the secret in resuscitating Star Wars spinoff films lies in bringing back Ford’s Han Solo and Mark Hamill’s Luke Skywalker from the dead? Fans line-up for legacy actors playing legacy characters. The Mandalorian is all fun and great for Disney’s streaming service, but let’s not forget, Star Wars was built to be a marquee cinema event.
In regards to their Fox acquisition, Disney has excelled in allowing their brands to be autonomous, and conventional wisdom is that the Burbank lot will allow Fox to keep making the innovative, big screen genre product that has won over the masses, i.e. Gone Girl, The Martian, The Revenant, Bohemian Rhapsody, etc.
Also, Disney needs to be careful when dating titles. Solo’s arrival 5 months after The Last Jedi assisted in killing some of its business. While this practice hasn’t slowed Marvel, i.e. Black Panther feeding into Infinity War, and this year Captain Marvel flowing into Avengers: Endgame, who’s to say it won’t one day? Does it help having two live-action feature adaptations of Disney classics, Dumbo and Aladdin two months apart?
No. 2: Warner Bros. ($1.93B, -5% vs. 2017)
What went right: Building a slate of low-to-mid-budget films (Crazy Rich Asians, The Nun, A Star Is Born and eventizing the second half of the year. The studio’s success can be attributed to great storytellers like James Wan, Steven Spielberg and Bradley Cooper and their innovative, relentless approach to marketing: Each and every film is sold differently, including sequels like Aquaman. The studio doesn’t rest on its laurels and assume that the entire Wonder Woman or Justice League fanbase is going to show up to the next DC film. Meg and Crazy Rich Asians‘ over-indexing stemmed from digital marketing working closely with film distribution to push ticket sales in key markets based on their grosses. Also, similar to Sony during the 2017 holiday season with Jumanji: Welcome to the Jungle, Warners wasn’t afraid to date against Disney with Aquaman besting Mary Poppins Returns, $216.2M to $114.5M. WB also made DC fun again with Aquaman.
What went wrong and what they need to do: The house of The Hangover still struggles when it comes to broad star-driven comedies like Game Night and Life of the Party. That said, all rivals struggle with the genre, and Warners/New Line is brave enough to keep making them. It’s often said you can’t make comedies without marquee names, however, this is the studio that created a near half billion movie in The Hangover and that was off largely fresh faces at the time. Warners/New Line has the brain trust to resuscitate comedies again,on a micro to low budget level with new talent coupled with the studio’s marketing smarts.
The drop between Fantastic Beasts: The Crimes of Grindelwald and its 2016 first chapter was large, $628.5M WW to $814M WW. This puts enormous pressure on the threequel to deliver. Fantastic Beasts has been a tricky property positioned at first as original fresh IP in the J.K. Rowling-verse and not exactly a Harry Potter prequel. Warner tried to speak more to the Potter-verse fandom the second time around, but a little too strongly, losing mass moviegoers. Whenever the studio decides to make an adaptation of the hit, $400 a ticket play Harry Potter and the Cursed Child, a better heyday is likely to be in store.
No. 3: Universal ($1.79B, +17% from 2017).
What went right: Their cash cow staples from Illumination (The Grinch), low-cost Blumhouse (Halloween, First Purge, Insidious: The Last Key) and older-skewing franchises (Mamma Mia! Here We Go Again, Fifty Shades Freed which took the franchise to $1.3B), and, of course, Jurassic World: Forbidden Kingdom. The studio’s mantra is excelling with a slate built on diversity.
What went wrong and what they need to do: Like non-Disney studios, they need more compelling franchises, and ones that the mass audiences can identify (not Mortal Engines which was an expensive attempt at world-creation, though from an obscure IP). Relying strictly on a diet of Jurassic World and Fast and Furious (no matter what shape future installments are in) is not a bona fide means to head into the future. Uni fared better with broad comedies than other studios (Night School had the best opening at $27.7M), but they encountered the same slowdown with the genre as rivals (Unlike Girls Trip, Night School fell short of the century mark with $77.2M domestic).
We also can’t ignore the release pattern for the studio’s awards contender Green Book which Uni absorbed from Focus Features. Universal thought they had a title akin to 2009’s The Blind Side; counter-programming that was secretly masquerading as a blockbuster and strong awards contenders. The latter is still in the cards for Green Book. While the Peter Farrelly-directed movie will be on marquees well past the Golden Globes, industry sources believe Universal went too wide, too fast with this emotional drama which was hindered by its obscure title (the pic opened with $7.86M in its first 10 days over the Thanksgiving stretch). Working in its favor is that Green Book continues to have excellent word of mouth. Through its 7th week, Green Book counts $32.8M. The lesson: Protect and nurture great Oscar prospects at the box office.
Sony ($1.28B, +21% from 2017)
What went right: Keeping their side of the Marvel franchise alive with Venom making $885M WW and Spider-Man: Into the Spider-Verse ($213.7M), together earning north of $1.06B. With all the production problems on Venom, dark clouds loomed over its faith, and Sony, thanks to studio boss Tom Rothman and his marketing, distribution and post-production teams, hammered the film into perfect shape and delivered a buzz-worthy event for autumn. The Culver City studio has an embarrassment of riches when it comes to franchises. This year they had in addition to Venom, a family skewing one (Hotel Transylvania Summer Vacation making over a half billion WW) and adult-skewing (Equalizer 2 with $190.4M), but four-quad titles abound this year with reboots of Men in Black, Grudge, and Charlie’s Angels and sequels Spider-Man: Far From Home, Jumanji 3, and Zombieland 2. With mass moviegoers embracing deeper universe comic fare more, the sky is the limit for Sony well beyond 2019 as they launch the feature take on Valiant Comics’ Bloodshot with Vin Diesel in 2020 and Marvel’s Morbius and Sinister Six down the road. Also, they’ve been able to foresee potential misses at the box office and limited their exposure on such movies like Holmes & Watson and The Girl in the Spider’s Web.
What went wrong and what they need to do: Awards-season fare such as White Boy Rick, The Front Runner, and the 2017 hangover All The Money in the World. Sophisticated adult fare is always a challenge, and the specialty B.O. sector has largely been down compared to last year. That said, these titles failed to get any awards season traction for either being too dark, took static, and or in the case of All The Money in the World, tainted by its the Kevin Spacey scandal. Some of theses titles were studio acquisitions or arrived via distribution deals ala Studio 8. Sony seems to win with these types of movies, both commercially and kudo wise, when they’ve been aboard early on in the process in the past, i.e. American Hustle, Zero Dark Thirty and Baby Driver (three Oscar noms last year, $230M WW).
20th Century Fox ($1.09B, -18% from 2017)
What went right: Reminding their future owner Disney what they’re great at, and how they can fill the bill heading into the new merger: R-rated superhero product like Deadpool 2 ($741.5M WW) and musical big picture fare such as The Greatest Showman and Bohemian Rhapsody. Of all the successes this year, the last one is sublime with a global B.O. north of $703M. Here was a movie many thought would fail given its notorious production problems, topped off by the firing of director Bryan Singer. But like Sony with Venom, Fox made damn sure this long-awaited Freddie Mercury/Queen biopic would win. Their awards campaign has been relentless trumpeting the talents of leading man Rami Malek and the pic’s below-the-line talents who helped steer this film after Singer left the set.
What went wrong and what they need to do: There were some misses here in the adult-corridor sphere in which 20th typically thrives. No one wanted to see an R-rated Jennifer Lawrence film that reteamed her with her Hunger Games director Francis Lawrence in a spy film that ran at 2 hours and 20 minutes. Widows from Oscar winner Steve McQueen proved to be a marketing headache as a hybrid between a social-political film and action heist. The Predator, though slightly higher than the previous Robert Rodriguez produced sequel worldwide, $160.5M to $127.2M, really didn’t have anyone jumping into seats. Try an Arnold Schwarzenegger reboot next time. Going forward the task for 20th remains keeping a loud voice as the provider of adult-oriented content at Disney.
Paramount ($757M, +42% from 2017).
What went right: While the studio was still in transition from the previous administration, you could see the hand of CEO Jim Gianopulos and his marketing, distribution teams already winning here, taking the studio’s staple series Mission: Impossible to a series high with Fallout making $220.1M domestic, $791M. Through six movies, the Tom Cruise franchise is still very much alive. Bumblebee could have performed better, but he’s contributing $71.3M to the the studio’s annual B.O. in 2018. Bright lights ahead with frosh series Dora the Explorer, Sonic the Hedgehog, the reboot of Terminator with James Cameron producing and Paramount’s rock music biopic Rocketman with Taron Egerton as Elton John and Bohemian Rhapsody back-up director Dexter Fletcher helming. Paramount shed some dead weight to Netflix that could have spelled B.O. misfires such as The Cloverfield Paradox (worldwide) and Annhilation overseas. But a spend wisely, gross high mentality is in place on the Melrose lot with A Quiet Place reaping $340.7M off a $17M production cost and their stateside pick-up of Book Club becoming a senior audience draw with close to $69M.
What went wrong and what they need to do: While Paramount rebooted their alliance with A Quiet Place producers Andrew Form and Brad Fuller with Fully Formed Entertainment, they’re bound to lose their Star Trek cornerstone J.J. Abrams’ Bad Robot as the label looks to re-locate elsewhere at Disney, Warner Bros. or Netflix. Solidifying a fresh round of relationships from solid filmmakers is key.
The mini-majors: Lionsgate ($389M, -56% from 2017), STX Entertainment ($270.3M, +31% from ’17) & MGM ($164.1M)
What went right: Not much for Lionsgate as they are still franchise starved in the wake of the success of Hunger Games. They also lacked a strong counter-programming hit like last year’s Wonder and 2017 six-time Oscar winner La La Land. The studio is looking forward to the film slate from their new senior leadership, Motion Picture Group co-chair Joe Drake and Motion Picture Group President Nathan Kahane. The studio is savoring its doubles in A Simple Favor ($94.8M) and its MGM co-production from Pantelion Overboard ($91.2M). They’re looking forward to this year’s Hellboy reboot, John Wick Chapter 3, the Seth Rogen/Charlize Theron comedy Flarsky in June, Roland Emmerich’s WWII action epic Midway and Rian Johnson’s Media Rights Capital production Knives Out in November.
STX Entertainment made more money at the domestic B.O. than last year from eight titles, the same quantify as last year. They did not have a breakout like last year’s A Bad Moms Christmas ($72.1M), but continue to toot the horn that they’re making money off low-budget hits through a foreign sales-low cost marketing formula (they claim that the $32M Amy Schumer/Voltage comedy I Feel Pretty is in the black at $94.5M WW).
MGM returned via its distribution deal with Annapurna with $164.1M, 69% of that coming from Creed II ($112.4M), which recently eclipsed the domestic gross of the first Rocky spinoff ($109.7M). If we count Overboard, MGM is at $214.4M from only four titles versus STX’s slate of eight titles.
What went wrong and what they need to do: Similar to other studios, Lionsgate is in great need of more franchises. There’s been continued buzz how they remain a takeover target.
STX needs a fire-breathing breakout hit in the Bad Moms sense of the word that clearly shows that their foreign sales, low cost marketing model is worth it, because rivals continued to be unimpressed. Still TBD on what’s next for this studio: Their next move should either be bold or bust. They refrained from pursuing a public offering on the Hong Kong exchange due to the volatile market there. Following that decision in late October STX boss Robert Simonds told staff internally that “two very compelling opportunities that we frankly find more attractive and value-creating than listing in Hong Kong” are in store. All eyes are on UglyDolls which STX is banking breaks them into the family animation sphere. Is a mix of comedies and low-budget genre action titles truly the future for this studio? They missed big on the raunchy Melissa McCarthy puppet comedy Happytime Murders ($27.5M off a $47M production cost which included a hefty payday to McCarthy well north of $10M), which was a fine line between novel and low-point shtick.
MGM is still rebuilding. Is a meal of library remakes like The Hustle (a femme reboot of Dirty Rotten Scoundrels) the trick? There’s some hot buzz surrounding their Dwayne Johnson wrestling indie Fight With My Family, and such original titles could be their means to the future. James Bond 25, which they’re doing sans Sony, won’t hit until February 2020.
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