Two bad weekends in a row…

If last weekend was a fender bender at five miles an hour, this weekend was a car wreck with bodies strewn about the freeway.   Two $100 million-plus productions assured that neither will ever gross anything close to $100 million domestically, pretty much assuring that both will actually lose money.   Let the softballing begin!

According to Reuter’s Dean Goodman, “Studio executives said a crush of new titles did not help matters, with films like Perdition and K-19 targeted at the same older-skewing audience.”  Yawn.   The movies and the marketing… the marketing and the movies.  Deal with it.  The numbers belie the idea that the market is overcrowded.  If either K-19 or Stu2 had opened to $50 million and/or Perdition had gone up 30 percent instead of down 30 percent, the film that opened soft could argue overload.  But given that this was the first weekend of the summer to be behind last year’s numbers and that there were no major weather issues and that there was no major TV event to pull people away… no.

Why did Eight Legged Freaks manage only a $6.9 million weekend?  The same reason Powerpuff Girls did only $6.1 million over a five-day weekend… Warner Bros. has too many damned movies and can’t sell them all. 

This is a company that did well with two very tough titles, Insomnia and Divine Secrets of the Ya-Ya Sisterhood, and opened the hell out of Scooby Doo.   They even did well with A Walk To Remember, considering that most guys and most anyone over 21 would rather have their eyes gouged out before watching the Mandy Moore vehicle.  What do all four pictures share?  Very, very targeted audiences. 

I happen to know that the publicity department was committed to pushing Eight Legged Freaks, but the one-sheet was all wrong (though spectacular in the few spots with a plush spider jumping out of the billboard) and the tone of the commercials was all over the place… they didn’t know what they were selling.  Was it a comedy or was it a horror movie?  It takes real genius to sell both things in one commercial spot… but when you have separate spots alternating between comedy and drama, you lose your audience… all of your audience.

Powerpuffs?  Was there an audience beyond the show’s Cartoon Network base?  WB never found out because they never made the pitch.  When’s the last time you found a film producer buying its own ads?  Cartoon Network felt compelled to do just that, which was the only exposure Powerpuff got until two weeks before the film’s release.  And one gets the feeling that CNN, another division of WB parent AOL/TW, was pissed, as they left the date, the name and logo of the releasing studio and the critical “Only in Theaters” warning off the billboards and posters they bought.

I don’t know how you feel about it, but I am paying attention and I am a Sandra Bullock fan and I am a huge Barbet Schroeder fan and the studio sure wasn’t selling Murder by Numbers to me.  Queen of the Damned, Juwanna Mann, The Salton Sea… the only really impossible sell that WB has had before E.L.F. this year was Death to Smoochy.  But if you looked at the Smoochy website, it had EXACTLY the tone and style that would have given the movie a shot of tripling their $8.4 million domestic total.  But they didn’t sell that.  They sold Robin Williams going crazy, not the satire.  Perhaps they thought that they could gross $50 million by going that way.  BZZT!  Wrong!

Remember, opening a movie is not about the quality of the movies.  Whoever likes or dislikes Eight Legged Freaks is irrelevant to this last weekend… selling a big enough audience to get it sampled was what was important… and it didn’t happen.  The studio even moved the opening to Wednesday to give it a head start on word-of-mouth… but the advertising, which also failed to exploit teen-sex-idol-in-the-making Scarlett Johansson, just didn’t work. 

There’s a completely different problem at Sony.  The team over there has managed to “open” almost every film they’ve had lately… including Stuart Little 2.  But unlike last summer’s template Universal summer, Sony has spent wildly in pursuit of marketshare.  And while they are likely to close the summer with three films in the top eight, profitability is on the descent as each film arrives.

Spider-Man is a cash machine, likely to be well over $300 million in profits.  But Men In Black 2, which is looking at something around $400 million worldwide, will still be in the red until video returns, given the gross points players, at which point the final color of the ink will be beige, not black.  XXX is a potential cash machine, though not nearly at Spider-Man numbers.  With an EDB of about $75 million, expect the film to end up with nine-figure profits of its own. 

(EDB is Estimated Domestic Breakeven, my roughhewn formula for figuring out how much a film has to make domestically in order to break even after adding in the foreign gross and ancillary dollars.  I try to take into account strengths and weaknesses in foreign markets and video/DVD sales, as well as back-end deals, marketing expenses, etc, etc, etc.)  

Stuart Little 2, which has an EDB of around $120 million, opened to an estimated $15.6 million.  Given that there are no holiday weekends left in the summer and that the only kid competition in the marketplace this weekend was weekend five of Lilo & Stitch, Stuart has pretty much no chance of passing $75 million domestic and is more likely to settle in somewhere around the $60 million mark max.  Giving the benefit of the doubt and assuming that Stu2 manages $175 million worldwide, the film would have to show a profit of at least $100 million in ancillaries to break even… just break even. 

Then there is the nuclear disaster… movie.  K-19 could reach $50 million domestic after a $13 million start.  It could.  It won’t.  I wish I could offer some great insights into this dry docked drama, from a box office P.O.V.  But the bottom line is - not interesting to kids, not interesting to women = not interesting at the box office.  Paramount is already referring reporters to Intermedia, which carried about $70 million of the production costs by selling foreign rights.  But Paramount is still on the hook for at least $60 million, between their production investment and P&A.  So they have a loser here, unless they have a very large portion of the video profits coming to them.  But my guess is that they are distributing video/DVD for a price, with Intermedia looking to make their money in that ancillary very same market.

COLUMBIA 2002 VS. UNIVERSAL 2001:  In an effort to further clarify the reasons why the huge numbers of this summer do not necessarily add up to a win for the industry, let’s take a look at the studio phenoms of this year and last.

Last summer, Universal had four hundred million domestic grossers - The Mummy Returns, Jurassic Park 3, The Fast & The Furious and American Pie 2.  The films cost about $250 million to produce and about $150 million to market domestically.  That’s a $400 million total domestic cost. 

The films produced about $655 million domestic.  Figuring 60 percent of gross coming back to the studio on rentals, the films returned $393 million to Universal or 98 percent of costs… before any foreign box office receipts.

This summer, Columbia is putting out four movies that cost more than $80 million to produce – Spider-Man, Men in Black II, Stuart Little 2 and XXX.  The films cost about $490 million to produce and about $180 million to market domestically. That’s a $670 million total domestic cost. 

The films, assuming a $75 million haul for SL2 and $200 million for XXX, will produce $875 million domestic.  Figuring an increased 65 percent of gross coming back to the studio on rentals, the film will return about $570 million to Columbia or 85 percent of costs. 

If you figure in gross point players, Universal’s domestic return drops to about 93 percent of costs, while Columbia’s domestic return drops to about 78 percent of costs. 

In the final analysis, Universal’s great summer of 2001 returned profits of about $450 million against an expenditure of about $480 million.  Columbia’s great summer of 2002 should return profits of about $530 million on expenditures of about $750 million.  Both summers are, obviously, reason to celebrate.  But which investment would you rather make? 

Remember, a great summer usually means that the studio will have a good year overall, as the successes cover the cost of the losers and takes the heat off of the rest of the year’s smaller winners.  But what happens if a studio chases these kind of franchise hits and two of four are losers?  Just a few years ago, a movie like Stuart Little, that cost $130 million to produce and will likely lose tens of millions, would be a tragedy at a studio, threatening everyone’s job.   Spider-Man makes it “okay.”  But with three films in one summer budgeted at $130 million or more, the stakes are getting very, very high.

ALSO:  On the weekend estimates, only Paramount’s reportage on K-19 seems iffy.  According to reports, Paramount’s Sunday estimate is at least 10 percent - or almost $500,000 – higher than would be normal for a Saturday-to-Sunday drop. 

Mr. Deeds is holding well and now looks like it will top out between $125 - $135 million domestic.   That’s more than triple what Little Nicky did and even though I could count Mr. Deeds as a bad movie, it makes clear that the Adam Sandler franchise is alive and fiscally sound.  Eight Crazy Days, an animated film in the spirit of South Park and Beavis & Butthead, is the next test and it will be fascinating to see how it does.

If Road to Perdition can maintain 30 percent drops for a couple of months, it will eventually roll into the $100 million club… but that’s still a long, long, long road to hoe.  My bet would be more like $85 million, followed by a big Oscar push to take it over $100 million next February.  But we shall see.

Reign of Fire’s estimated 55 percent drop is as good as should have been expected.  The film deserved worse.

JUNKET WHINE:  I was interested in a story I ran into in Chicago’s Daily Herald by Joel Reese.  I’m not going to comment on it right now… please read it and let me know what you think.  I’ll comment tomorrow.  Click here to take a look.

READER OF THE DAY:  I’m going to put a one-day moratorium on the Minority Report debate.  More ROTDs on the issue tomorrow.

JOHNE writes, regarding a ROTD from last week:  “The 80th percentile does not get Eyes Wide Shut, Fight Club, Magnolia, Vanilla Sky, Memento, Mulholland Drive, Amores Perros, Go, Run Lola Run, Unbreakable, Dogma.”

NO NAME JONES writes, in an unedited letter:  “Hi, I'm just writing to mention something about Harrison Ford and K19. Now, the movie itself is not great but it is as entertaining as a Sum of All Fears or Bourne Identity has been this summer. But Harrison Ford has a nice role, playing against type and this is the kind of choice he should be making as he is now in his sixties.

Now the crux of this message is; WHEN THE HELL DID HARRISON FORD'S AUDIENCE GET THIS OLD?!!!!! I'm 24 and I felt the same way I felt when I ran out of the theatre showing My Big Fat Greek's Wedding because it looked like the waiting place for St Christopher or the registration center for the soon to be no more.

I mean, when I saw AFO, I went with my buddies and I saw tons of people in their late twenties and early thirties on opening weekend. The same with Random Hearts and What lies Beneath when I saw them.

Second, immediately I saw it, I knew it was KO at the box office. In this times, after 9/11; in which total support and unquestioning of the US govt is de rigeur and american patriotism is at its highest, the audience felt uncomfortable in the scene where the Russians are being given propaganda by attacking American's wealth and lust while hiding the truth of inequality of the black people. Also, you could sense their antennas go up at the scene where the Americans come to help and the Russians decide to make jest and show their asses. Also, harrison's russian accent and continually saying that all the americans want is the submarine and continually referring to America as the enemy was totally going down the wrong way. The guy beside me kept looking at the screen as if Harrison Ford was a traitor and as if he was asking himself; "How can "Mr. President", Indiana Jones; the man who has been the representation of American heroism and patriotism could be selling out like this?" You could tell they didn't give a damn about their predicament and if they all died or decided to change course and head for the Bahamas. Those russian accents don't help either, especially when harrison delivers his best assimilation of it when they come in for those closeups. If this was studio system Hollywood, the bosses would have dictated that they all speak with American accents and would probably changed the story from Russians in peril to Americans in Peril and flipped the American role to the Russian role knowing the current climate. I'm predicting at least a 50% drop. Not Harrison's fault but he will take the blame. That leaves me wondering, with harrison's audience so old; is it wise to make another Indiana Jones movie?”

And this comes from JOHN THE GENIUS (intellectual cousin to Fast Jonny):  “To me, K-19 belong as a high-profile HBO Movie...

Wait a minute...IT WAS AN HBO MOVIE!!

1997.  HOSTILE WATERS starring Martin Sheen as the American Captain and Rutger Hauer as the Russian Captain.  It was set in 1986, but given the way you described the Plot of K-19 there just isn't any difference in the two movies.  Added to the fact that the Russian Crew were entirely played by Europeans, which helped the consistency of the acting.

I remember the film looked cheap, and the Subs (on either side) didn't look all that convincing (I know something about Submarines), but for me, the characters played well.  I really sympathized with this Russian Captain, who was trying to do the decent thing (putting out a fire in his Reactor Room) while there was an American Sub Captain lurking out there with an itchy trigger finger, looking to sink him.  There were no real bad guys.  No Polar Opposites doing a stare down for 120 minutes.  Just circumstance.  People rose and fell as a result, and the Military wasn't so sort of higher calling.  It was a job.  Everyone involved, Soviet or American, put in a workday.

Anyway, I was wondering if you had seen it or where familiar with it.  It may be worth a look, just to compare it to K-19.”

E ME:  Interesting, huh?  I don’t think that anyone is “over” because they make one or two crappy movies.  Old Harry Ford has plenty left in the tank, I’d say.  He just has to make better choices.   What marketing campaigns for movies in the past confused you into apathy?