Monday, May 15, 2006
Boxoffice No Longer Matters
I am old enough to remember that when a movie broke through the $100 million mark during its entire boxoffice run it was BIG deal! These films received official "blockbuster" status and people remembered them. These days, a film can make $100 million in its opening weekend, but can also disappear into oblivion just as quickly. The gamble the studios are taking with current film budgets, evidenced by a recent report in The Wall Street Journal, seems to officially indicate that boxoffice is no longer the way studios hope to turn a profit. Citing rising special effects costs, The Wall Street Journal reported that the budget of Sony's Spider-Man 3 (scheduled for release on May 4, 2007) is between $250 and $300 million! Likewise, 20th Century Fox's X-Men III is reported to cost $210 million; Disney's Pirates of the Caribbean: Dead Man's Chest, $225 million; and Warner Bros.' Superman Returns a whopping $261 million! The risk on the new Superman movie is particularly interesting given that the Superman franchise (while experiencing somewhat of a resurgence with TV's Smallville) has not had a successful boxoffice outing in decades! So, if boxoffice alone was the means by which these studios and production companies hoped to recoup their costs -- especially given that today's boxoffice rises or falls on an opening weekend -- it would just be bad business. Even a great boxoffice run these days doesn't usually top $400 million. S why would studios reduce their profit margins by spending so much? The answer is: boxoffice doesn't really matter any more. DVD sales, pay-per-view, licensing, etc -- all have become a standard part of a film's financial success. Long ago in "Movies on My Mind" I argued that films are no more than $200 million dollar commercials these days. This move on the part of studios seems to support that argument.