I was reading a Merrill Lynch study on equity funding of movies. And it finally occurred to me how Warner Bros could claim profitability for Superman Returns without getting sued by Time-Warner stockholders.
Here is the chart… Click here to see it
And here is the math…
Superman Returns grosses $392 million worldwide. That
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It shows how out of it I was in trying to be in it, acknowledging that I was out of it to myself, and then thinking, “Okay, how do I stop being out of it? Well, I get some legitimate illogical narrative ideas” — some novel, you know?
So I decided on three writers that I might be able to option their material and get some producer, or myself as producer, and then get some writer to do a screenplay on it, and maybe make a movie.
And so the three projects were “Do Androids Dream of Electric Sheep,” “Naked Lunch” and a collection of Bukowski. Which, in 1975, forget it — I mean, that was nuts. Hollywood would not touch any of that, but I was looking for something commercial, and I thought that all of these things were coming.
There would be no Blade Runner if there was no Ray Bradbury. I couldn’t find Philip K. Dick. His agent didn’t even know where he was. And so I gave up.
I was walking down the street and I ran into Bradbury — he directed a play that I was going to do as an actor, so we know each other, but he yelled “hi” — and I’d forgot who he was.
So at my girlfriend Barbara Hershey’s urging — I was with her at that moment — she said, “Talk to him! That guy really wants to talk to you,” and I said “No, fuck him,” and keep walking.
But then I did, and then I realized who it was, and I thought, “Wait, he’s in that realm, maybe he knows Philip K. Dick.” I said, “You know a guy named—” “Yeah, sure — you want his phone number?”
My friend paid my rent for a year while I wrote, because it turned out we couldn’t get a writer. My friends kept on me about, well, if you can’t get a writer, then you write.”
~ Hampton Fancher
“That was the most disappointing thing to me in how this thing was played. Is that I’m on the phone with you now, after all that’s been said, and the fundamental distinction between what James is dealing with in these other cases is not actually brought to the fore. The fundamental difference is that James Franco didn’t seek to use his position to have sex with anyone. There’s not a case of that. He wasn’t using his position or status to try to solicit a sexual favor from anyone. If he had — if that were what the accusation involved — the show would not have gone on. We would have folded up shop and we would have not completed the show. Because then it would have been the same as Harvey Weinstein, or Les Moonves, or any of these cases that are fundamental to this new paradigm. Did you not notice that? Why did you not notice that? Is that not something notable to say, journalistically? Because nobody could find the voice to say it. I’m not just being rhetorical. Why is it that you and the other critics, none of you could find the voice to say, “You know, it’s not this, it’s that”? Because — let me go on and speak further to this. If you go back to the L.A. Times piece, that’s what it lacked. That’s what they were not able to deliver. The one example in the five that involved an issue of a sexual act was between James and a woman he was dating, who he was not working with. There was no professional dynamic in any capacity.
~ David Simon
Actually, to be fair, Batman Returns was down quite a bit more than 10% from Batman ($251 million vs $163 million or $411 million vs $266 million, depending on which stat we want to play with).
Of course, this was back in the day when A) sequels usually grossed a lot less than the originals and B) big budget movies capped generally their budgets at $70 million, so it was still an enormously profitable venture. Ironically, Returns budgeted ‘officially’ at $55 million was considered a disappointment, yet Batman Forever, budgeted at ‘$100 million’ was a ‘huge smash’ grossing $184 million, a mere $20 million more versus a budget of at least $40 million more. To be fair, there were rumors that Batman Returns ended up costing close to $90 million, but one can only wonder what the actual budget for Batman Forever really was.
Point being, if Superman Returns II does a comparative 64% of the original, on a comparative budget, it would be an absolute disaster and financial bloodbath.
And considering that Batman Returns was an under loved sequel to an enormously popular movie, it’s a hell of a dice roll to spend even $150 million on a sequel to a movie that a lot of people didn’t really like. They could end up in the same situation as Tomb Raider I and II, where the vastly superior sequel tanked because people hated the original and didn’t want a sequel in the first place, even one that (as seems to be the promise from Singer) learns from the mistakes of the original.
Scott Mendelson
Where is Superman Returns still playing? And who was going to see it last week rather than sometime earlier in the four months since it opened? I can’t help imagining some dismal off-the-map theatre whose clientele consists entirely of the broken and the bitter and the unemployable, who trudged in to see Superman because it seems marginally preferable to going home and making a tuna melt for one for dinner again…
I remember Spam Dooley pointing out that no film lost money and Dave going calypso on his ass. How fun to watch Dave twist his neck to PROVE goddamn it that it didn’t make money because of development costs that were written off in another year.
Dave- YOU can never do these calculations correctly because THEY never let out what the film really costs or really takes in. You omit Merch entirely for example in your analysis.
If THEY want to make a sequel it is because the first one made money.
Next interview with Channel 7 instead of pushing endgames why not push accuracy?
I am Jeff Well’s Ego.
But you’re wrong, Spammy. Even by Merrill Lynch’s accounting, half the films lose money.
Yes, I left out merchanise, but I also left out gross points.
There is no big secret to why a sequel is possible. It’s the same reason why a sequel to Hellboy is in the offing. It’s why there was an Eddie & The Cruisers II. If you have the established franchise, on whatever level, there are economic models on which is can work, even if it wasn’t previously profitable.
THEY obviously have no interest in telling the media anything. But THEY do not control all modes of information.
Yes, it is absolutely possible for Fox to make money of a piece of shit like League of Extraordinary Gentlemen. But they aren’t making a sequel to it.
But that won’t mean anything to you because you can’t be Don, Spam… he really isn’t anywhere near this dumb.
But thanks for continuing to make it all about me. My bodyguard thanks you for forcing his employment.
Spam, you were wrong months ago when you went off on this ‘no film loses money’ nonsense and you’re still wrong now.
David, did you actually hire a bodyguard? This is news.
I never argue that a piece of shit like League made money- I argue that it didn’t lose money.
But let’s look at your point re Hellboy okay? Stay sane for a minute.
Sony, the originating studio passed. Every studio in town passed on it more than once, until the new regime at Universal said yes.
Now, if we accept my point that no film LOSES money, then what does the above obviously mean?
That no studio thought they would make ENOUGH money to engage on the sequel. Until Linde et al.
Remedial 101- go back and read the Katzenberg open memo after Dick Tracy- the part where he talks about how, even though they made money on it, it wasn’t worth it.
I am not Don Ho, Don Murphy or Donny Most. You have no need for a bodyguard, but you might need mental help. No film loses money. I promise.
I am Jeff Wells’ Ego!
Spam, if a movie doesn’t make money, by definition it loses money. I’m sure there’s a tiny fraction that balance out evenly but it probably happens as often as a tossed coin lands on its side.
Provide some documentation for this obviously ridiculous notion, if you think you’re so sure.
Jeffty
What ridiculous notion? Do you believe that films actually LOSE money? You are FIVE.
Here is what happens.
1- budget is done for movie X. It comes in at $100m
2- $25 m for movie x p and a is allocated
3- Domestic distribution is contacted and made to commit to a MINIMUM/LOWEST BO number
4- Same with Intl
5- same with Video
6- same with tv etc ancillary
when the numbers promised as a minimum equal the budget so that in WORST case the film breaks even then it is greenlit
Now, yes, maybe once a year like Stealth, the minimums are not reached- but the reason they ARE minimums is because they are always reached.
Do you really think they LOSE money on films?
I am Jeff Wells’ Ego!
Coming from the Wall Street end of things, I appreciate this analysis.
Shouldn’t DVD and TV Rights be considered in the profitability equation. The big entertainment congolmerates all report those revenue streams, along with rentals in one segment. Merchandise I think can end up outside the studio. I know it does at Disney for example.
Anyhow, I understand that the idea is to try to determine if a film is profitable based on box office only but it seems the larger picture is the better goal.
Wolfy
That is my point
If you take the cynicsm, self loathing and hatred that is Dave and then mix in banal mathematical machinations, you come out with the belief that Superman lost money.
It didn’t.
I am Jeff Wells’ Ego
Of course they lose money on films. If they NEVER lost money on films they would make riskier films with less reliance on starpower. A studio allows itself to lose a certain amount on some movies because they know that they will make profit on other movies. This is how distribution model works, spreading risk over multiple releases per year. According to you, Spam, the movie business is pure profit, which begs the question of why ever year or so some studio announces hundreds of layoffs.
Why, Spam, are you making an argument that is so clearly wrong? What benefit do you think you’re getting out of it?
Of course they lose money on films. NO THEY DON
Spam, you’re wrong and yelling won’t make you right. David is correct, there seems to be something mentally wrong with you.
Eddie lives!
I don’t want to argue with you, Spammy.
But I don’t want anything to think you are accurate.
It happens a lot more often than once a year per studio.
Ultimates are a lot more accurate than hopes and prayers. But they also change and end up not being met.
And your Hellboy example is broken, since Linde did go for it. There is no exact science. Is Linde going with it because he thinks he won’t make money on it? Or is it (this is rhetorical) because Universal is anxious to build franchises and has none? (See Hulk 2 as well)
The corporations have made movie money safer and safer, which is why we continue to see outside money. If every movie made money, every movie would be financed by the studio in whole. Reducing risk means there is risk.
Yes, they really lose money on films. But things are now structured in such a way that it is very hard to lose big money and the studios are such a small part of their parents that they can’t shut themselves down anymore. Yes, DreamWorks and The Weinstein’s Miramax were brought down by a combination of non-film expenditures and a handful of expensive films.
Ironically, this is what caused such consternation around Paramount for a long time
Goddammit Dave
Stop speading half shits
1-HULK 2 is fully financed by Marvel not Universal
2-And Linde went with it because his studio and his alone felt that they could break even worst case at that high a number- NO OTHER REASON
3- IPs lie as I told your bully bodyguard as he manhandled me at Trader Joes
4- I am in pain laughing at you since Merchandise is a major profit center at every studio
5- Miramax was brought down by personal animus- at $800m a year they didn’t matter either way- but Eisner with his dying breathe decided Harvey was coming with him
6- Dreamworks was brought down because instead of making ten films a year it was Walter Parkes’ personal pplayground
7- all merch is separated. Marvel still pimps Spidey toys but Sony gets a huge piece of the movie toys
It isn’t hard to get the facts straight David. As a journalist you know that.
I am Jeff Wells’ Ego!
“IPs lie”
Spam, your identity is clear…you don’t even seem to be able to follow which lie you’re telling now.
If you’re going to be wrong, keep it to yourself.
Dave, one other reason that studios invest money in films is becasue the financial partners outlined in the Merrill Lynch exmaple won’t give such reasonable terms if they don’t see the studios taming their shareof the risk.
And good point about DC and where stuff gets allocated. You can manipulate P&L pretty easily on any sepcific project within an entertainment conglomerate.
The big difference in a Superman sequel making signifigantly more for a sequel, and X-Men having done so is Superman is a one the clearest, most well known properties on Earth. X-Men is the top dog property in an ever-waning, and increasingly insular medium. Even when the first one came on the scene and made money, it received relatively little in the way of mainstream publictity, compared to say, The Patriot and Charlie’s Angels. It had to win over casual audiences, while at the same time not having time to build word of mouth in theaters because a core one was burning it out faster.
There are people who were ambivalent to the very concept of the X-Men, but seeing the movies changed their minds. Superman, on the other hand? People have known about Superman their whole lives. There aren’t going to be a singifigant amount of moviegoers who have never been interested in Superman, catch Returns on DVD or cable, and decide that they suddenly have interest in the franchise. It’s neither good enough a movie, nor fresh enough a take on the character to have that affect.
There is no business anywhere that can guarantee a profit on its product. None. If people don’t pay to see your movie, you don’t get money for it. It’s simple.
Your argument seems to hinge on entities like “domestic distribution” doing things like “committing” to a lowest box office number. This entity known as “domestic distribution” may or may not “commit,” but they sure as heck can’t guarantee that for some reason the money just might not be there. Even if you took some theoretical movie and kept it in the theaters for 20 years, waiting for that money to roll in, it still might not! Movies lose money all the time. That’s not an opinion.
Clearly, though, you’re not so much interested in the actual facts of the way the industry works, which clearly eludes you. You are clearly much more interested in recreational stalking and sneering than intelligent debate.
I have no idea why David doesn’t ban you from this board. When people come into my house and smugly insulting people, I kick them the heck out.
David,
This website risks becoming a joke when you allow ‘recreational stalkers’ (good term) to dominate the board with ridiculous arguments like NO FILMS LOSE MONEY.
You are supposed to be some insider who has an insight into the way Hollywood works and yet people come here to find you arguing with a halfwit about whether films ever lose money.
If even the flops make money than it would stand to reason that the hits would make so much profit that the studios and the corporations that own them would be awash in profits and cash. Why is that not reflected in their stock prices? Answer – because the entire notion is totally ridiculous.
This is actually pretty interesting stuff. David and Spam wound up not being that far apart, and jeffmcm is just the ruse that keeps things going to an extreme.
‘NO FILM LOSE[s] Money’
I can’t believe someone said that. It’s business, so, like all businesses, of course some films will lose money. If the above statement were true, then everyone will be rushing in to make films.
I’m a ruse? Wha?
Spam/Ego/whoever just needs to shut the hell up. They’re boring and idiotic and a complete and utter waste of space. JUST PISS OFF!
Ugh.
Now. Whoever reckons Superman Returns is not going to play well on DVD? I mean, it was dreary enough as it was at the cinema, let alone on DVD when people can fast forward all the scenes of characters staring into the distance or whatever. And they can press stop and forget about it all together. And that big finale with the rock is gonna look sorta ridiculous on a tv screen.
Unlike the original X-Men which played really well on tele because it was extremely well paced but also wasn’t filled to the brim with overbearing special effects that could only be of benefit on a big screen.
…or that’s just my thinking.
Yup, Kamikaze, for some reason I also think SUPERMAN RETURNS won’t play that well on DVD.
Here’s what I’d do…Stick the DVD in, watch the titles and listen to John Williams then go to ‘chapter search’ and pick the ‘747 peril’ (or whatever it ends up being called) – watch Supes save the plane and then press ‘eject.’
There is nothing really else to watch, unless you think lifting a grey chunk of kryptonite to the sun is good entertainment or watching Supes visit a hospital as a climax is rousing…
So if no movie loses money, Mario Kassar should be getting some checks for Cutthroat Island returns any day now….
And I suppose Orion just mysteriously imploded one day for no reason.
I think if someone wrote a movie finance tell-all today, we’d all be more than a little shocked about greenlight and profit. What good are outdated examples? What does “subject to certain parameters,” MGM said, mean? You know what I’m saying.
So, how does that work, anyway? The package gets sent over to business/marketing who looks at their chart and assigns the chart value to the various parts of the package?
Let’s see… Car chase in the third act, that’s worth $10 million. Tom Cruise is the star, that’s worth $40 million. And once all the elements are added up, they have an expected box office number. And that estimate is so good, it never waivers. It never results in a number that doesn’t match reality?
And no movie ever goes significantly over budget and throws off the numbers?
I don’t doubt they come up with an estimate and attempt to budget accordingly. I just have a hard time believing the movie business, unlike all others, has found the formula that results in profit for every investment.
An EVP in finance services the studio head and crunches the numbers from deals negotiated for the company by business units. Marketing is like the publicist and jumps in last.
The first STAR TREK movie didn’t make a whole lot of money, but Paramount figured they could keep it going if they cut the budget. #1 cost 40 mill, #2 cost $14 mill. It grossed less, but was far more profitable, and thus the franchise was kept alive by hewing to a strict budget formula that assured profitability (at least until the last one), owing considerably to the fact that sets, costumes, and FX had already been created and kept for reuse. Thus, following that formula, there’s no reason why a Singer sequel couldn’t be made for considerably less than the first one.
I take your point, Cosmo.
It is hard when there is such a range of people on the blog, from kids with an interest to industry execs.
I think, in the end, Spammy is of the “you can’t lose money unless you are an idiot” school. And like most people who aren’t in that seat, he is always right and people he dislikes or disagrees with are always wrong.
I think one of the most fascinating things about the business is that people of such varied degrees of skill can have such similar, cyclical results. It is an endless study of micro and macro. Is Amy Pascal her best year, her worst year, or somewhere in between? Same with Alan Horn. Do we praise Grey/Berman for the success or their two films this year/ever or do we rip them for not making enough movies?
It is extremely easy to get glib about all of this. And sometimes, glib is right. And sometimss it is not. It’s hard to learn that all of this is a casino and it’s all about the margins, since there are very few who will ever put a quarter in the machine and win a million dollars. But that possibility seems to fuel most of the people in the buiness… except for the studios, owned by corporations, that are doing all they can to become the casinos. This business is more and more about that quarter coming out of every dollar you win in Pai Gow.
“Marketing is like the publicist and jumps in last.”
They shouldn’t. Marketing should be involved from the get-go. And certainly marketing considerations are taken into account when deciding whether to make or not make a particular movie (or what elements to attach to it).
While I’m sure finance crunches the numbers specifically, a well-run company wouldn’t keep marketing in the dark until the end.
That kind of marketing is development, while the actual task of marketing is after you greenlight for profit and before you win as a casino.
Here is another way the producers were able to keep the production up in the sky…
http://www.theweeklydonut.org/index.php/category/super-size-me/
T.H. there was actually a television documentary a few years back. It was british and it aired down here but probably not in the states, that was all about the business. It said that actually very few films were profitable enough. Sure, some may make the studio a few mil, but rarely do movies make tonnes of cash.
It was very interesting, but can’t remember the name for the life of me.
Okay everyone. I’m new here but I could not continue to read your posts without jumping in with my thoughts. Superman Returns is a beautiful film and anyone who thinks it is a horrible movie does not understand it or what it was trying to do. To live in this big screen, CGI, action, action, action movie world we live in can get so frustrating! For a big budget movie to come along with its bond of father to son and with such emotional depth, what is horrible is no one gives this type of superhero movie a break. Spider-Man 2 was far more sappy than this film. Returns is not without flaws but everyone is so hard on it. And the fact that it grossed close to $400 million after the last Superman movie made $12 million in 1987 and bombed out the series shows that Superman leaped the tall expectations it needed to for the new film series to survive. Everyone should go look and research and read the scripts to the failed attempts of relaunching the Superman series and they will see how bad it really could have gotten. Singer was setting up a new film series that had -gasp!- deep, emotional and real characters! It’s getting the sequel. Not to mention that the beloved X-Men series failed critically with The Last Stand and Returns was very, very well reviewed. This shows that maybe all these people who didn’t like Returns might have missed the point. Superman Returns isn’t an action movie, it is a drama with some action sprinkled in. If it had the right marketing, or even good marketing, that showed us that it is not intended to be an all out action film with no heart (Michael Bay anyone?), then maybe some people would have accepted it for what it is. I believe that Superman returned the way he needed to. I’m tired of everyone saying it was a disappointment at the box-office. $125 to $150 million would have been disappointing. It could have been Terminator 3. I understand that it had a huge budget but I don’t think the budget was given to just Returns. New technology was created for the effects and sets are now built for future films. It is a hit and I’ll defend it to anyone.
By the way, it will be huge on DVD. DVD is all the rage these days. People will pick it up for christmas for a quick gift. I also think that an older audience could discover the film when told it is more of a drama than effects and action like X-Men. It is this audience that ignored it in the first place because of what they thought it was. This audience will also become the new fans. It’s smart, deep and well rounded.
Bring on the sequel!
I’m confused. “DVD is all the rage these days”? I’m sorry, are we in the year 2000 again? I hear Gladiator is a good movie!
“when told it is more of a drama than effects and action like X-Men”
Get the party line straight, pal. Singer directed that one and infused it with drama.
“For a big budget movie to come along with its bond of father to son and with such emotional depth, what is horrible is no one gives this type of superhero movie a break.”
The father-son thing was such a small part of the movie as the center is more about Superman wanting Lois. And the speech he gives his son near the end is verbatim from the first movie, so Singer himself was setting up comparisons between his film and the much more fun previous films.
It’s important to remember that the DVD will also be part of the SUPERMAN 14-disc mega-box set coming out later this month, so it will move a lot of units simply by virtue of its inclusion, especially to people who probably would not have bought it as a stand-alone title.
“The father-son thing was such a small part of the movie as the center is more about Superman wanting Lois. And the speech he gives his son near the end is verbatim from the first movie, so Singer himself was setting up comparisons between his film and the much more fun previous films.”
First off I like how you call it “The father-son thing.” I also like how the center of the film is really about Superman finding a place in a world that has moved on without him, having the Superman-wanting-Lois “thing” just as small of a part as the other “thing.”
“And the speech he gives his son near the end is verbatim from the first movie”
Did you not get that Returns IS a sequel and that sometimes quotes are used from earlier installments. You just proved my point that many just don’t get it with this movie. If you got it you would understand that those words, those loving words, were from his father to him and must have comforted him through many years of feeling alone and isolated and now he has a son! He has someone to call his own! He travled all those years to Krypton to find life, to find one of his own kind, just to return to find out that he has one of his own growing here on Earth… I could still go on about the depth of this and how he can pass those loving words to his son even though he never thought he’d get that kind of moment in his lifetime. Just think about movies as you watch them. It seems most people need a CGI creature to reach out of the movie screen and shake an audience member to get any kind of thought process flowing. This isn’t directed at any one person but at mass audiences in general. Yeah it’s a Superman movie and yeah it should have had more action but the story was so rich and the emotion so real and moments that mean so many things on so many levels that it begs the question: Is it really too much to grab that brain that you checked at the door and use it. I understand most of these types of films are more action than thought provoking. This one is different and I feel bad for Returns. Yes, it’s darker and more moody than Donner’s fun previous film. So what? It’s a misunderstood movie. I don’t think people knew what kind of film it was and went in wanting Spider-Man or X-Men. I blame 95% on marketing for this. Different hero, different take, different tone.
“‘when told it is more of a drama than effects and action like X-Men’Get the party line straight, pal. Singer directed that one and infused it with drama.”
Sorry, pal. I referenced The Last Stand earlier and I was saying that Returns is more of a drama than effects and action like X-Men: The Last Stand. But that was my mistake. I should have wrote X-Men 3 or The Last Stand.
“It’s important to remember that the DVD will also be part of the SUPERMAN 14-disc mega-box set coming out later this month, so it will move a lot of units simply by virtue of its inclusion, especially to people who probably would not have bought it as a stand-alone title.”
There is also a Christopher Reeve Collection of the first four films. If people wanted the older films, they’ll buy that. If they want Superman II: The Richard Donner Cut, which is also included in the 14 disc set, they’ll buy that on its own too. Superman Returns will earn it’s own sells.
DVD is all the rage these days. If it wasn’t would we have all these tv shows on DVD and all these “Special Edition” DVD’s jumping around? DVD has slowed down, yes, but box-office is down and one reason why is the movie is out on DVD in three months after its release. That says a lot. People pick up DVDs like they are impulse buys. They might as well be put up by the gum…. oh wait. They already do. Hummm.
But WHV tends to price collections much more cheaply than individuals. If you buy the Reeves box and the II recut separately, you’re only saving about $6-8 from the mega-set.
I think there’s a serious disconnect between intention and result. You can intend a great many things, but if it doesn’t work, it still doesn’t work. I can appreciate how SR goes deeper into the Donner films. But the question remains: So What?
Style has to match substance. If Singer came out with a film different in tone than the Donner film, I would have appreciated him not making so many overt “homages” to it.
The father-son connection was made so late in the film. And even worse, where is the moment when Superman realizes this is his son? The audience finds out, but we never see Superman himself finding out. Did he just know the whole time? Just feels like if this was going to be dramatic, we’d see that reaction.
^^^Palmtree’s right.
Yeah, that was something I also missed the first time I saw it. When did Superman know he was his son? It seems Lois tells him when he is sleeping or in a coma or whatever in the hospital. I think it would have been better if their was more of a reaction scene but I think they covered it pretty well when Superman is almost completely in shadow in his son’s room and you see his eyes fill with tears when looking at Jason for the first time as not just Lois Lane’s son but as HIS son. I think that when you really can’t see Superman’s face but you see that emotion overtake him is amazing.
I said before that the film has its flaws. Finding out that the kid was his so late in the picture is fine. You don’t want everything thrown in at the beginning. Plus, it brought the themes of the film full circle and help set up that storyline to be followed up on in the sequel. You can intend a great many things but I don’t see where the whole picture didn’t work, like you say. To who’s calculation does it not work? Yours? Mine? I think if the film serves its purpose, it works. You may not like it but that doesn’t mean it didn’t work.
By definition, if somebody didn’t like it, then it didn’t work for them.
SR didn’t work for me at all. I found it challenging to stay awake at times.
He feels the connection when he meets the mature kid with the inhaler, but he doesn’t find out until after she knows it. Heart and Soul forever. Nice that WB’s screening it, really liked it, thanks supermanarrival.