Studio melds comic book co. into pic plan
When the Walt Disney Co. proclaimed last year that the studio would get back to focusing on family fare that defines the Disney brand, one thing was missing from the equation: the films that would attract families to the megaplex.
After releasing a string of underperformers like “Race to Witch Mountain,” “Bedtime Stories” and “Confessions of a Shopaholic” at the box office, company topper Bob Iger was quick to admit the problem wasn’t the economy but the “choice of films and the execution of the films,” as he told Wall Street in May.
“It’s not the marketplace. It’s our slate,” Iger said.
Iger’s candid confession could easily have been read as the kind of corporate insecurity that has been known to put studios into a creative coma as they figure out which pics may actually connect with auds.
Yet the Mouse House is a different animal these days.
With Iger as Disney’s Mr. Fix It, the company is showing a surprising level of confidence — unusual at a time when the recession might be expected to have the opposite effect — and is aggressively brokering deals that won’t just prop up the studio at the B.O. but also produce properties that create significant financial upside for the rest of Disney’s divisions.
Its latest move — last week’s $4 billion deal to buy comicbook giant Marvel Entertainment — gets Disney into the superhero biz, an area that other studios have clearly capitalized on but one that the Mouse House hadn’t been active in, other than releasing Pixar’s “The Incredibles.”
The more than 5,000 colorful characters involved in the Marvel pact will surely help launch a franchise or two — something Disney hasn’t done since “National Treasure” in 2004 — but also give Disney the ammo to attract males, especially young boys, to its movies, TV shows, cable channels, websites, theme parks and merchandise, which now appeal mostly to girls with “High School Musical,” “Hannah Montana” and the Jonas Brothers.
“Cars” is still one of the surprising standouts in the Disney/Pixar roster: Released in 2006, the toon, which earned $426 million worldwide, continues to perform as a runaway seller of toys to boys. And the Disney XD channel (formerly Toon Disney) plays more than 20 hours of Marvel-produced programming.
While the resulting tentpoles under the Marvel mantle should help energize Disney’s release schedule for years to come, the studio had been quietly but vigorously pursuing other ways as well.
That includes turning to prolific producers on the lot or such high-profile directors as Jerry Bruckheimer, Robert Zemeckis, Tim Burton, Jonathan Mostow, Rob Marshall, Jon Turteltaub and McG to remake classics “A Christmas Carol,” “Alice in Wonderland,” “Swiss Family Robinson,” “20,000 Leagues Under the Sea” and “Tron,” or adapt popular videogames (“Prince of Persia: The Sands of Time”), TV shows (“The Lone Ranger”), or even segments of “Fantasia” (“The Sorcerer’s Apprentice”). A fourth “Pirates of the Caribbean” is planned, as are three additional installments of “National Treasure.”
The Disney plan also involved bringing Steven Spielberg onto the lot through a deal to distribute DreamWorks’ slate of films through the Touchstone banner and Liberty Media’s pay cabler Starz. The move, which saw Disney pony up $175 million as part of an $825 million fund to finance DreamWorks’ rebirth also enables Disney to pump more pics through its strong, but until recently underutilized, distribution pipeline, since DreamWorks plans to release as many as six films a year.
The only sticking point in that pact could be the types of films DreamWorks decides to make. Red flags will surely be raised if any are considered too violent, raunchy or serious and don’t mesh with the Disney brand. DreamWorks’ first pic through Disney will be a remake of the invisible rabbit pic “Harvey.” Spielberg will helm the pic, which is a co-production with 20th Century Fox. DreamWorks’s comicbook-based actioner “Cowboys and Aliens” is being released by Universal, while “Dinner for Schmucks,” a co-production with Spyglass and Paramount, is being distribbed by Par.
But that may not matter. Disney sees the DreamWorks deal as a relationship builder, and one that pays it back a healthy distribution fee without requiring considerable resources. It’s just not one that drives the rest of Disney’s divisions.
“I don’t care if a Touchstone movie does $100 million on $30 million of cost,” Iger told Fortune late last year. “Its success doesn’t breed any other success in the company.”
While rumors around town have an axe hovering over Miramax, Walt Disney Studios chairman Dick Cook said the indie arm is safe for now.
“There is no for-sale sign on Miramax,” he has said. “It’s a great place to find new talent and nurture interesting projects. And when you do hit it, it can be extraordinarily profitable and gives an added dimension with not a giant amount of overhead.”
Toons, obviously, are an easier fit with the Disney brand, and under the helm of Pixar’s John Lasseter, Disney’s animation division has worked to get back to its glory days.
With December release “Princess and the Frog,” Disney will introduce its first new princess — named Tiana — in more than a decade. She’s expected to become a fixture in the Mouse’s theme parks and to help sell dresses and other clothing in Disney’s successful line. So will “Rapunzel” and a Scottish princess in “The Bear and the Bow,” planned for holiday 2010 and 2011, respectively. “Toy Story 3” bows next summer after the re-release of the original duo, all in 3-D, while “Cars 2” races into theaters in 2011, timed with the opening of a themed 12-acre Cars Land at the overhauled California Adventure park.
Lasseter’s toon team is said to be especially excited over the Marvel buy, with its animators already scouring the company’s library, identifying characters it can turn into movies, TV shows and direct-to-DVD releases.
The expanding slate of releases across multiple age ranges is certainly giving Disney something to talk about. The studio started contracting its sked in 2006, to release 12 to 14 films a year. Fewer films have enabled it to spend more time promoting pics upon their release across all of its divisions, making them appear more high-profile, with an eye toward earning more at the B.O.
But it is now confident it can make even more coin.
It showed off its renewed confidence at Comic-Con this summer when it rolled out impressive presentations for “Alice,” “Christmas Carol” and “Tron,” and its animation slate that touted its support of the 3-D format, with the first ever 3-D screenings at the fanboy convention. In the past, the Mouse House’s presence in San Diego had often been awkward, with the studio unable to connect with the fanboy auds. In the future, Disney may find itself heading down to the Con with a bigscreen version of Marvel’s 3-D Man. (Yes, it’s an actual character.)
Before that happens, however, Disney will host its own answer to Comic-Con in Anaheim this month, dubbed the D23 Expo, at which the company will show off virtually everything Disney has to offer over four days. The event was conceived in the wake of criticism that the Mouse wasn’t reaching out enough to Disney’s diehard fans.
With its latest deals, Disney also hopes to keep its shareholders happy. Investors like nothing more than consistency, meaning a constant flow of revenue, and Disney is providing that to them through safe bets with a relative high hope for return. While many observers initially questioned the price, buying Pixar in 2006 for $7.4 billion proved a worthwhile gamble.
Likewise, Disney’s movies are easy sells with an instant recognition factor. So are its stars.
It repeatedly gives roles to Nicolas Cage, Dwayne Johnson, John Travolta, Robin Williams and Miley Cyrus for just that reason. And after Johnny Depp helped Disney earn $2.6 billion at the B.O. with the three “Pirates” pics, it made him nearly as important as Mickey Mouse, enlisting him to reprise his role as Captain Jack Sparrow for a fourth pic, and tapped him a
s Tonto in “The Lone Ranger,” planned to start after the next “Pirates” adventure. He’ll next be seen as the Mad Hatter in “Alice in Wonderland.”
Although Disney won’t be able to make movies around Marvel’s higher-profile characters or even integrate them into its theme parks — they’re set up at other studios and at Universal’s parks for many years to come — the Mouse House will still be able to capitalize on their success. Marvel collects a percentage of all revenues generated from films featuring the characters, which will now go into Disney’s coffers. Marvel expects to post profits of around $100 million this year.Marvel may only have made $110 million from the $2.9 billion generated by the first three “Spider-Man” films, but Marvel has a sweeter deal for its next five pics — the next two “Iron Man” films, “Thor,” “The First Avenger: Captain America” and “The Avengers. Those films will be released through Paramount, but the studio only collects a distribution fee of around 8%.
When Iger brokers an expensive deal, he likes to call his acquisitions “a perfect fit” for Disney. He did so with Pixar, then with DreamWorks and again with Marvel. Of the latter, he said buying the comicbook company was “a great opportunity at the right time.”
After reporting Disney’s first operating loss since 2005 this summer, the timing certainly couldn’t be better.