May 12, 2004

Statistics about the film business cannot answer every question. What inspired me about the book "Moneyball" was the notion of taking a clear look at an industry by way of statistics and realizing that, like so many things in life, if you are clear about what you are trying to achieve and you understand the tools at your disposal, your likelihood of success increases exponentially. In the case of "Moneyball," there is the Yankees, whose business is built on the notion of being the biggest spender in the game… but also finding a way to win that not every high spending team does… and the Oakland A's, who spend a quarter of the money that the Yankees do, but win just about as many games.

Six days into the Summer of 2004 the first big release, Van Helsing, is taking a lot of heat. However, even though I am applying some of that heat, Universal has made only one real mistake in making the film… they spent too much money. The marketing and publicity departments did all they really could, as reasonably detailed by Susan Wloszczyna in Tuesday's USA Today. (Of course, details like this would never have been supplied by the studio if they weren't in a defensive mode.) And the quality of the film itself… well, it is one of the misnomers of this business that there is an answer to "it's good" or "it's bad" on the business side.

In the last three summers, the only films that were as profitable or more profitable than The Matrix Reloaded were Finding Nemo, Spider-Man, Star Wars: Episode II and Pirates of the Caribbean, roughly in that order. Reloaded was most expensive of those massive hits, yet it was hundreds of millions into profit in theatrical. But Reloaded continues to be pointed to as a failure. That is not rational.

Van Helsing was right in Universal's wheelhouse… on every level except for budget. For the second year in a row, the studio fell into the trap of throwing more money at what they have been doing at a price for years under Stacey Snider. No studio has had a better run of Franchise Action films. But it seems that industry perception that the stakes had to be raised in order to have a bigger summer wins won over what the studio executives saw so clearly when they were not breaking records each summer (even with the disappointment of The Hulk, the studio set a summer record last year with five $100 million films and Bruce Almighty became the second highest grossing straight comedy ever).

Will Van Helsing outdo the $245 million that The Hulk did theatrically across the globe? Probably. But not by Hulk-sized leaps and bounds. But that is not the story. The story is the four other films last summer and The Bourne Supremacy this summer, all of which will be more profitable at a lower price. Not every film can be a natural inexpensive franchise like The Fast & The Furious. But when those films fall short, they don't tend to lose very much nor do they sink the studio into depression for weeks when they need their energy and good spirits to launch their other films.

The Chronicles of Riddick is substantially cheaper than Van Helsing. And the same exact box office results will be seen as a win, while Van Helsing is seen as a loser. That is the difference. It's still a Franchise Action film, which Universal knows how to make and sell, but there is less money and less pressure on the table. More specifically, the value of owning the first weekend of the summer didn't change one way or the other based on Van Helsing.

In retrospect, Universal might say, "But Van Helsing didn't have the pre-sold elements of The Mummy Returns, Spider-Man or X2." And they'd be right. But that's the point. The economic opportunity to have a $100 million weekend exists on the first weekend of May and - I don't think - exists anywhere else in the summer or any other season. Van Helsing got only half the money. Is there a summer movie that could have gotten more this summer? Maybe. Spider-Man 2, The Day After Tomorrow, Shrek 2 and Harry Potter 3 seem to be the ones… all franchise sequels but one.

The reverse works as well. All four could still open with higher first weekend grosses than Van Helsing. But there would have been, statistically, about a 10% increase in opportunity on that first weekend.

Statistics can lie and anything is possible in the magical film business. But to rely on magic is a fool's errand… especially in a business that has low margins to begin with. Five times opening… that is what I would call "magic." Only six films in the last three summers grossed five times opening or better. Pirates of the Caribbean and Shrek were home runs. Seabiscuit, Spy Kids 2 and The Others were triples. The Italian Job was a stand-up double. Finding Nemo was pretty magical at 4.8 times opening… but you get my point. Icing may be the best part of the cake, but you can't survive on it for very long.

The average multiple in the last three summers is 3.4, which is better than most think by reading the trades each week. June is the weakest month for multiples, averaging 3.1, which is still okay. Don't like averages? 24% of major May releases in the last three years has done less than 3 times opening. 38% of July releases have done less than 3 times opening. A whopping 57% of June openings fail to hit 3 times opening. In August, you have a 41% chance of not making this target, but if you reduce the survey to films opening the first half of the month, which is really when summer ends, only 22% of releases fail to his 3 times opening.

In the last three years, there are a few box office clusters worth noting. The first weekend of May is the only date that has delivered a $50 million-plus opening each of the last four years. Before last Friday, that stat was even more crystalline, with three straight years of openings more than $68 million. Another May cluster is date variable, but it is that late May, formerly the Memorial Day weekend, slot. There have been five openings with a start over $59 million start in the last three summers in that slot. So, May has had eight $50 million openings in the last three years.

June has had 3.

The only July 4 weekend $50 million opening in the last three summers, right on the date or the weekend before, was Men in Black II's $52 million start in 2002. That is one of only four such openings in the month of July 2001-2003, only one of which is not for a sequel… Planet of the Apes, which is somewhat a sequel, somewhat a remake. And no, Pirates of the Caribbean was just under $50 million and succeeded so beautifully by managing the extremely rare 6.6 times opening.

August has had two $50 million openings, both on the first weekend of the month. These are part of the final cluster, which also includes the July 26 and 27 openings of Apes and Goldmember.

Shrek 2 and The Day After Tomorrow should join Van Helsing, making May a solid, if unspectacular month for openers. Harry Potter 3 and Spider-Man 2 should turn June into a hot opening month this summer. (In the past three years, the only title to pass $150 million in June was Scooby Doo, which did $153 million.) And The Village and Collateral will look to take full advantage of the late July/early August cluster.

Here are some more stats for your perusal…

You have almost no chance of hitting $100 million with a summer release without a $20 million opening. The smallest opening in the last three summers that led to a $100 million domestic total was The Italian Job's $19.5 million launch last year.

The Bourne Identity and The Princess Diaries are the only two $100 million surprises in the last three years. So if you have a sleeper, don't expect to hit nine figures… make sure you are enormously profitable with less.

As for $200 million grossers, in the last three summers, 9 opened in May, none opened in June, 2 opened in July after the 4th and 2 opened on first weekend of August.

Universal, Columbia and Fox have averaged over $30 million per summer opening in the last three years. New Line too, but with only 6 releases. Disney has averaged almost $26 million per film. WB, Paramount, MGM, Miramax and DreamWorks have averaged openings in the teens.

Disney, Universal and Fox have all averaged over $100 million per film in these last three summers, with Columbia just under the mark with a $99.9m average.

Universal has had the most success with original films, meaning not sequels, franchises, remakes or kid demo films. They scored with Bruce Almighty, The Fast & The Furious, The Bourne Identity and Seabiscuit), while Disney hit with two (Signs, Pearl Harbor), as did Columbia (XXX, Mr. Deeds). DreamWorks had Road to Perdition and Fox had Minority Report. Those ten are the entirety of $100 million grossers in these last three summers that fit the category. Fitting in those often complained about categories are 31 films. Thus, the odds of an original being a big hit… limited… less than 25%.

The dog-eat-dog nature of the summer is suggested by the rather amazing drops between the box office takes for the big successes and everything else. Universal has a $63 million drop between its lowest grossing $100 million plus film (American Wedding) and the next best grosser (About A Boy). Columbia has a $29 million gap. Paramount, $35 million. New Line, $131 million. Miramax/Dimension, $41 million. MGM, $50 million. Fox, $46 million. And DreamWorks, $31 million. Warner Bros, which has the most titles, but only three $100 million titles, is the most consistent, followed by Disney.

More tomorrow…

READER OF THE DAY: ARTHUR'S CUCKOLDER writes: "Saw Troy tonight and already forgot most of it. A couple of great individual fights and a whole lot of male and loin -- but not one pair of breasts. Interesting twist on the norm.

The real point of this letter is to ask you what in the fuck is going on with Brad Pitt's tongue in that woman's mouth? I expect it in Lyne's movies, but in a sword and sandals pic? Beyond what his wife must think, is this another desperate attempt by an actor to manufacture emotion and passion when his acting skills fail? Is tongue going to be the norm in a couple years? Enlighten me if you could."

E ME: Can this question get your tongue wagging… or at least your fingers?