A list of 2010 developments that will impact the biz
Even with the economy rebounding, the majors are scrambling as never before to adjust to a fast-changing environment.
This past year saw profound changes in studios’ focus, as marketing and merchandising became even higher priorities. And 3D was just the tip of the iceberg in terms of tech innovations; tech behemoths were knocking on studio doors offering new ways to distribute movie and TV franchises. The year saw Disney’s Robert Iger and Relativity Media’s Ryan Kavanaugh shake up the business profoundly — Iger with a push for shorter windows for “Alice in Wonderland” and Kavanaugh with a five-year deal with Netflix. That pact will give the movie-rental service the ability to offer customers a slate of films shortly after they’re released on DVD, bypassing paycablers HBO, Showtime, Starz and Epix. The exclusive pact with Relativity also enables Netflix to keep a list of films away from rival Redbox.
Here’s a list of other 2010 developments that will continue to have a major impact on the film biz. The list is alphabetical by studio, and it’s appropriate that Disney is at the top: It’s the studio where changes has been the most profound among the Big Six.
- Disney provoked U.S. exhibs early in the year when it told them it wanted to break the theatrical-to-DVD window on at least two titles a year, shortening the gap to just over 12 weeks vs. the usual 16. In the face of strong adverse reaction, Disney settled on a 13-week gap for “Alice.”
- Disney studio chief Rich Ross tapped “Tron: Legacy” producer Sean Bailey as president of production and then went outside Hollywood to recruit MT Carney, of New York ad shop Naked Communications, as its marketing chief. Both moves feed into the goal of marketing movies as larger consumer brands. Ross nixed pics that didn’t present broad potential, focusing on cross-platform fare like “Pirates of the Caribbean: On Stranger Tides,” “Tron,” “Toy Story 3” and Marvel content including “Iron Man 3” and “The Avengers.” The Mouse’s new chiefs also dove into the vaults to resurrect properties including “Black Hole” and “The Muppets.”
- The indie-specialty sector continued to morph. Seventeen years after buying Miramax, Disney exited the world of arthouse films and sold the label for $660 million to construction magnate Ron Tutor and a consortium of investors. The new owners have teamed up with Bob and Harvey Weinstein to produce sequels to Miramax titles including “Bad Santa,” “Rounders” and “Shakespeare in Love.”
- Fox followed its stunning “Avatar” success with a rough patch: No other Fox film managed to cross the $100 million domestic mark. “Date Night” came closest with a domestic take of $99 million. Still, “Avatar” continues to be the gift that keeps on giving for Fox, ending up as the year’s top-selling Blu-ray and DVD by a large margin with more than 30 million Blu-ray and DVD discs (15.3 million in North America alone) since April 22. But the biz is cyclical, and Fox could rebound in 2011 with new versions of “X-Men,” “Planet of the Apes” and “Alvin and the Chipmunks.” In addition, James Cameron is committed to two “Avatar” sequels, skedded for 2014 and 2015.
- MGM is finally back in business after several years of being hobbled by $4 billion in debt from the 2005 buyout. Most of the company’s focus is on its two tentpole properties. It’s committed to spending $265 million-$275 million in production for its half share in the two “Hobbit” films; it’s also on its way out of bankruptcy with $500 million in exit financing, with much of that money likely going to a 23rd James Bond film. Studio is hoping it can deliver the pic in 2012 to coincide with the 50th anniversary of “Dr. No.”
- Paramount continued to opt for the slimmest release slate among the majors with only 13 titles but a heavy franchise focus. Its most profitable films were a pair of low-cost sequels — “Jackass 3D” and “Paranormal Activity 2,” with worldwide grosses of $170 million each (a third “Paranormal” is already set for next October). Other major 2011 titles include the third “Transformers,” the fourth “Mission: Impossible” and Marvel tentpoles “Thor” and “Captain America: The First Avenger.”
- Studios opted mostly for continuity in the executive suite. The year’s most immediate major shakeup was at Sony, where Matt Tolmach exited as prexy of Columbia Pictures, a post he’d shared with Doug Belgrad, who is now sole prexy of the unit. Warner Bros. began a major long-range shift: It set up a succession plan with a three-person office of the presidency: Jeff Robinov, Kevin Tsujihara and Bruce Rosenblum are set to succeed Alan Horn (who retires in April) and Barry Meyer (who’s been reupped through 2013).
- Sony had a strong year with “The Social Network,” “Karate Kid,” “Grown Ups” and “Salt” but ended the year with the flame-out of James Brooks’ starry “How Do You Know.” The studio has begun production on a reboot of “Spider-Man” with “500 Days of Summer” director Marc Webb and Andrew Garfield starring as the webslinger.
- Universal experienced the most dramatic corporate change as Comcast closed in on completing its purchase of a 51% stake from NBC Universal. Its major success in 2010 came in the form of its first break-out hit in animation with “Despicable Me”; its major development deal was firming up its partnership for Stephen King’s “Dark Tower” in the form of a trilogy of feature films and two seasons of a TV series to bridge gaps between the films. First pic will be released in 2013.
- Warner Bros. didn’t suffer much for splitting the final “Harry Potter” book in two or declining to release it in 3D. And it scored a major hit with “Inception,” a passion project for Christopher Nolan — who’s now making “The Dark Knight Rises.” Key initiatives include rebooting “Godzilla” and “Superman” and ramping up DC Entertainment, which has been moved from Gotham to Burbank.
There were also plenty of surprises from the mini-majors.
- Lionsgate managed to fend off Carl Icahn’s hostile takeover bid and his picks for the board. The mini-major maintained that its strategy of spending an average of $12 million per film remains viable as it crossed the $500 million mark for the first time thanks to a slate featuring a pair of pickups: “The Expendables” and “The Last Exorcism.” Icahn, who owns 33% of Lionsgate and has an MGM board seat, is certain to keep pushing to merge Lionsgate and MGM.
- Summit remained a powerful player among the indies thanks to the third “Twilight” and “Red.” It’s got two more “Twilight” pics coming thanks to its decision to split the final book in two. But it’s uncertain if Summit has another franchise coming any time soon — upcoming releases include “Drive Angry,” “Source Code,” “Three Musketeers” and “The Beaver,” before “Twilight Saga: Breaking Dawn Part 1” opens on Nov. 18.
- Relativity Media continued to rise. Kavanaugh positioned his company as a full-fledged mini-major, executing the first-of-its-kind deal with Netflix and taking over Overture for its distribution apparatus.