Money & Morons

How can I be blunt enough about this?
Hmmmm…
If you are positioning the Shrek Forever After opening as a huge disappointment… you might be a moron.
if you are out peddling some crap about how this opening speaks to how people feel about 3D or ticket prices… you might be a moron.
If you are pushing an agenda that has little, if anything, to do with a bigger opening than ANY Pixar movie has ever had… you might be a moron.
I am SICK TO DEATH of entertainment writers taking their expectations of box office, based on tracking and spin and rarely any facts, and forcing the stench of failure onto a success. And conversely, hyping mediocre numbers into An Incredible Event every time they get surprised by something doing decent business.
It becomes news AFTER it happens, you foolish people. And after it happens, you should feel free to analyze it to your heart’s content using real facts and figures.
How To Train Your Dragon opened to a weekend 60% smaller than S4. Yet Dragon has been hailed as some kind of phenom in many journalistic circles because it held a little bit better than most animated movies, which tend to hold better than most other genres.
Meanwhile, the same idiot market analysts who hyped up an opening like Shrek 4 are now extrapolating until the cows come home trying to explain its failure… when it hasn’t failed. It’s a nightmare. (And of course, this comes from the geniuses who brought you, “UP is going to drag Pixar’s brand down” and “Ratatouille is too French to do business” and of course, “Kids will never sit through the silent part of Wall-E… downgrade Disney!!!”)
And don’t even get me started on the ticket counting fools out there.
All I can say is… take a fucking breath, people!
Right now, S4 is ahead of UP‘s first four days… which led to $730m worldwide, which would leave S$ about 10% off of Shrek The Third if it can maintain a strong trajectory. Would that still be written up as a failure or a disappointment… or are we all just stupid?
In the end, it doesn’t really matter and I should stop reading all the terrible journalism about box office. It doesn’t really change the revenues. Even the analysts are wrong so often that it doesn’t tend to affect stock prices. But as a journalist, it is embarrassing. And as someone who ends up explaining what the reality is to a lot of smart people who are believing whatever stupid spin is popular out there, which holds the ADD-addled interest of wannabe box office writers until Sunday brunch, it is infuriating.
Please don’t think that I am saying that everyone who has a different take than me on these things is a fool. There is plenty of room for disagreement in principle. And I am certainly capable of an incomplete thought that leads me astray from the core reality of a particular situation. But as when I criticize film critics for going herd – which I still assert happens 2 or 3 times a year in a big way, positive or negative – it is when it feels like someone threw a not-very-thought-out idea against the wall and then everyone seems to follow, each rationalizing it in their own way (so as to draw attention), that I am driven to distraction.
It’s lazy thinking. And while even a broken clock is right twice a day, it is usually wrong.
And then someone brings up A Christmas Carol… whose opening was overly attacked… which Disney didn’t actually expect to open much bigger… but which Disney did hope would hold a lot better into the end of the year. So… in the end, it was a clearly disappointing number vs expense. But that didn’t make the overly aggressive write-off of the film at opening the correct perspective. It was an incomplete perspective… that turned out to be closer to the end result than not.
But that is the rarity.
Conversely, The Dark Knight opened much better than I ever expected. But that didn’t mean that it was really ever going to challenge Titanic… and it didn’t get withing $800 million of the then-record-holder. Being wrong about one thing does not mean you are unable to stop, think, and analyze based on where you are after your misstep
On the third hand, when I am right about something like Avatar, literally from Day One, that doesn’t make me RIGHT either. I was actually wrong about how massive the film’s gross might actually be… about a billion dollars off. But I was closer to the end result than most. But it’s all a puzzle. Sometimes history is helpful… sometimes it throws you way off. Sometimes a leap of faith takes you somewhere great… sometimes to the toilet. And when we all start writing about expectations, it gets very, very blurry, very , very fast because whose expectations and which of that individual’s expectations, etc. No one funded Dark Knight with the idea that it would have a $100 million opening, but by the time it opened, had it missed that mark, WB would have been disappointed. No studio funded Kick-Ass… full stop. But when this hard R comic book movie opened to just under $20 million, it was like someone had died. Are we all nuts?!?!
If there is one thing I can encourage, whether you think my takes are right or wrong, is to really think and to be serious about finding perspective, even in the short term. Just because everyone wants to be first, to fly to conclusions, to come up with the hot angle, does not mean that thinking, caring, smart people should not rise above the breathlessness of the culture around us.

Tweet du Jour

The Danger Of Shortcuts

The Drudge headline…

The actual story.
Not a review.
In fact, the normally scrupulous Guardian kinda crosses a line here by running this story about how two movies ruined the TV show… without, apparently, having seen the second movie.
The author writes, “Judging from the hideous trailer and even more hideous scenes that have been leaked on the web.”
She adds, “(C)ould a cinematic experience be any worse than that SATC film (part 1) was? The answer from this Friday, when SATC 2 opens, looks set to being in the affirmative (and I warn you now, this article will be full of spoilers, spoilers of both the film and your memories of the show).”
Every spoiler does seem to be from the commercials and trailers. Is it possible that she saw the film and is trying not to break embargo? I guess. But by claiming spoilers and speaking so definitively about how the 2 films have ruined her memories of the series, she blurs the line with clear intent, if unclear purpose.
Is it journalistically responsible to condemn what you haven’t seen… even if I assume she is right about “2” sucking?
Is this in any way “The First Review?” Or is it just another desperate attempt to get ahead of a story that hasn’t happened yet… even from one of the best outlets for movie coverage in the world?

Chris Klein Is Middle Aged

I guess Funny or Die is the new Jay Leno’s Couch for embarrassed celebrities.
I didn’t find this particularly funny, though I appreciate Klein being game. Much more surprising to me… at least here, Chris Klein look more like the high school teacher than the high school student. And indeed, Glee’s Mr Schuester is 8 months older than Klein. American Pie was 11 years ago. Sigh…

Ticket Prices

I don’t get all these stories about rising ticket prices.
Somewhere in all of them, the actual facts are there. But there is an odd obsession with pushing this story about massive increases in the average price.
There is a massive increase in the additional price for 3D… and an even more massive increase when an IMAX premium is paid in addition.
But a few simple facts.
Going into May, all four of the top grossing films in 2010 were in 3D (Avatar, Alice In Wonderland, How To Train Your Dragon, Clash of the Titans). Over $1.2 billion grossed domestically in 2010 between the four of them… or about 1/3 of every theatrical dollar grossed in this country through the first four months of the year.
Again… rough numbers… but say those films had, with IMAX counted, a 25% bump, divided by being a third of the total tickets sold, equal a little over 8%… or about what NATO said was the rise in ticket prices from the year before.
But the flip side of that is that there was probably zero rise in base ticket prices. That is, until this month, when most chains tend to raise their prices by 25 cents, summer in and summer out.
The problem I have with all this noise about it is that it feeds into misconceptions about the future of theatrical… again.
There are 5 or 6 movies coming out in 3D the rest of this summer. Toy Story 3 is clearly The Big One. We’ll see houw The Last Airbender – a late, cheap conversion – plays. I can’t imagine any more than $300m combined domestic in the rest.
In other words, if these films represent $1 billion domestic in a $4 billion summer, average ticket prices should actually go DOWN this summer, even with an actually small price increase in the base price of all films.
Will the hysterics report on that?
Or will they be forced to and then spin it into some kind of negative with a convenient stat like “tickets sold” going down?”
We’ll see.
What I am feeling inside the industry is a well-founded fear that the 3D business is overreaching already and that increasing ticket prices for often unnecessary 3D will soon turn off average moviegoers. This is balanced by a group that wants to change the whole system and hopes to use the misunderstanding of the facts in stories like this “rising ticket prices” thing to push their agenda forward.
Interesting times.

The Stupidity Of The 30 Day Studio Window

The Wall Street Journal broke a story that Time-Warner Cable was making a pitch to studios for a 30-day VOD window for a $20 – $30 price point.
It’s moronic.
But it’s also interesting.
It’s another iteration of the ongoing interest in figuring out whether VOD will ever really work… because it still doesn’t on a studio level. It never really worked at 24 weeks… it doesn’t really work at 16 weeks… so “let’s try it at 4 weeks at a premium (though non-“fight”) price.”
WSj notes the DVD downturn as a motive for all this window-bashing… and I don’t know if the authors know how right they are. Studios, it is seeming more and more, are looking for The Next DVD… and they are willing to be reckless to try to create it when it cannot be created.
The sad part of this idea – the 28 day window – is that it is wrong in almost every way. Besides cannibalizing theatrical, which is now more important than it has been in a decade, it seems to completely misunderstand the market. In the arthouse world, things are quite different… anything to find a wider paying audience is worth the risk. But for studio movies, I have never seen a study of any kind or any historic fact that suggests that the audience that wants to see wide release movies will be motivated to pay a premium for home viewing after 30 days of not going to the movie theater… and we are talking about pricing that is roughly the cost of two movie tickets.
The one category of films that might work in this 30 day idea is blockbusters that have a lot of buzz after 30 days and may have an audience of impulse buyers.
But again… big problem. The vast majority of impulse buyers of movies are… under 25s. But they don’t control their own purse strings, as a rule. The first time the cable bill arrives with an extra $50 charge on it for a single viewing of MacGruber and Iron Man 2 is the last time Billy gets to buy VOD in all but a tiny percentage of households where money is loose.
The value proposition for high priced PPV is diminished dramatically by a 30 day window. If you are going to jeopardize the theatrical window, you might as well just take the leap to day-n-date and see how it works with non-franchise movies. My take is that after a honeymoon of a few months – people love to kick tires – it starts being a clear loser. But let’s find out.
The slippery slope here is that you start the experiment with the $20 – $30 idea. It has mixed negative response. So the logical next step is adjusting the price. But as the price drops, the cannibalization starts to grow.
What journalists who write about this subject tend to miss is that the “old-fashioned” idea of windows in the marketplace is not actually what I think anyone in the industry thinks is the future. Right now and for years now, there are five or six windows. In the future, there will only be one real window… between theatrical and post-theatrical.

BYOb Sunday

Anything to say about Cannes?
Anything else?

Weekend Estimates by MacKlady

Shrek Forever After (or is it Shrek: The Final Chapter?) is in a very odd position. It’s the fourth best opening weekend in animation history… but somehow, because the last two opened so huge, that is a perceived failure. It will certainly gross over $220 million domestically and is more likely to end up in the $250m range, making it the fourth Shrek film in the Top 10 all-time of animated films… but anything short of $300m will be seen as a failure.
Part of this is the insanely high bar created by the first three films. And part of it may well be that DreamWorks Animation has built itself up to being a consistent $200m domestic performer and this Shrek will not, like the last two did, blow that normal number out of the water. Remember, Shrek 2 is still the #3 domestic grosser in history.
In any case, when the film being written off by so many critics as happily the last in the series is a Top Ten performer in its genre and still outperforms every other animated film its very successful company has made outside of that franchise, it’s easy to undervalue what should be qualified as a success. (And for the record, unlike other summer movies that gross strong numbers, but which I then question the fiscal validity of, animation is reasonably budgeted vs $200m-plus domestic grosses. Success is an issue of degree and expectation, not the potential of red ink.)
Of course, the biggest question for this film, delayed by the World Cup, is international box office. Will it be $200 million… $300 million… $400 million? That’s where the profit margin will be determined.
NEXT…
Iron Man 2 is looking like it will match the first film domestically. But in the weeks to come, things will get interesting vs Prince of Persia and then, I think, The Karate Kid, which could grab every eyeball that is still interested in repeat viewings of IM2.
Amazingly, Robin Hood could end up finding a way to $100m domestic. It might even find a way to $300m worldwide, which would make it Ridley Scott’s 3rd highest grossing film… though $260 is more assured. Still, if you believe the cost estimates out there, it’s still not enough to get this film to profit.
MacGruber is an interesting Rotten Tomatoes story. 54% seems awfully high, considering how much traditional critics seem to hate it. Only 3 critics from what could be considered major outlets were positive in their reviews. One was Joe Leydon for Variety, who saw the film in the midst of SXSW hysteria. Does being in a room that LOVES the movie help a critic think the better of it? (I’m sure Joe will soon offer an opinion.) Robert Abele, freelancing for the LA Times, liked it enough for a fresh tomato. And Peter Travers, aka The Great Laydown, gave it quotes… no surprise there… if they advertised world wars, he’d find a way to praise Hitler with an exclamation point.
But my point isn’t to kick the couple of mainstream outlets that praised MacGruber. I haven’t even seen the film. I will look forward to seeing it on Starz next year. But what’s fascinating is that RT, which is used like it’s the NYT of film criticism by far too many people, is showing its ass here. It’s not like the film is “Fresh.” But even 54% “Fresh” is misleading here. It’s 80% “Fresh” for people who saw it at SXSW and about 20% “Fresh” for people who did not. By not showing the film until the last hours before release, aside from SXSW, the distributor kept the “Top Critics” (read: Traditional Media) group down to 12 reviews (25% fresh… based on the 3 reviews I already mentioned) from the normal 25 or so. And the overall group of people included in the rating, normally over 200 for a wide release, is down to an ironic 69.
In other words, Universal made RT their bee-otch on this one. I am guessing that the Tomato Ranking will fall under 40% in the next week or so… maybe lower, as more reviews come in.
Either way, Ryan Kavanaugh loses money on this one and Universal just wasted their time. MacGruber would have been a great day-n-date VOD title at a $10 price point. A very niche piece that might just be of enough interest to that core group to generate strong numbers… at a price… in a very short window.
After all the hullabaloo about Babies not opening the way people thought it would, it’s now over $5 million and is one of the biggest documentary grossers in the last couple of years. Only Michael Moore, Disney’s Earth, and the self-distributed right-wing cult project, Expelled: No Intelligence Allowed, have grossed more in the last two years. That would be a success, folks.

Friday Estimates by Leonard Shrek-y

Shrek Forever After just didn’t get ticket buyers as excited as DWA and Paramount would have liked. Personally, I blame the confusing ad campaign that didn’t really address what the story of the movie is… “What The Shrek Just Happened?” means nothing if you don’t know that Rumpelstiltskin has managed to send Shrek back to the beginning of his journey.
These numbers would be good for most other animated films. 60% better an opening day than, say, How To Train Your Dragon. But a bit soft for Shrek. Pretty likely, the opening weekend ends up in the mid-70s to mid-80s. But there were those calling for 100m+, which ain’t happening.
Iron Man 2 is still runing $25m ahead of the first film… but is slowing faster. This Friday estimate is about $1m off of the first film’s third Friday. We’ll see how it plays out over the 3-day. In the meanwhile, foreign is still the main story here, with IM2 passing the first film’s total international gross sometime today. Disney and Marvel will have to determine whether they are getting into dangerous territory here, as the international market is often a movie behind domestic in terms of giving up on a weakening franchise. IM2 should be at least $100 million bigger, worldwide, than IM. But next time, that may signal a smaller gross for the third film… or not.
Letters To Juliet is now past Remember Me and will break the $30m Summit glass ceiling… establishing the $40m glass ceiling… about half of Dear John… but an improvement for the company.
MacGruber opened to about 25% less than Hot Rod. Look for a $4 million weekend and a $10 million total domestic gross. What does it mean? Only that even the geeks didn’t really turn out for this one in force. I guess they are waiting on Get Him To The Greek for top geekomdy.
Just goes to show that Relativity can even lose money on a $10 million one-off with a strong SXSW geek kingdom push. Skillz. (Universal, btw, suffers only the embarrassment of association and wasted marketing team time on this one.)