Heroes at Lions Gate

Marvel inks for heroic DVD toon deal

Eager to press more of its superheroes into service, Marvel Enterprises has pacted with Lions Gate Entertainment to develop and distribute original animated features for the direct-to-DVD market.

First of eight original animated projects (2-D and 3-D) is due to be released by late 2005, company said.

Production partners haven’t been named, but company indicated Lions Gate’s animation partner, CineGroupe, will be a contender to produce some of the animated pics.

Each title will have a minimum running time of 66 minutes. Companies said specific details as to which characters will be exploited will be announced in future.

The deal continues Lions Gate’s aggressive move into the market for original animated DVD movies based on popular properties. That effort began with the release of “Barbie in ‘The Nutcracker'” nearly three years ago and has included movies based on “Hot Wheels,” “Rescue Heroes” and the upcoming “Popeye’s Voyage: The Quest for Pappy.”

Glenn Ross, president of Lions Gate’s Family Home Entertainment division, said if the first eight titles do well, the companies will look at making more.

“We want to broaden the demographic for Marvel’s characters to include both adults and kids, and to create an ongoing series of DVD movies that people will anticipate and collect like they do the Marvel comicbooks,” Ross said.

“Going straight to DVD is the next level of publishing,” said Marvel CEO Avi Arad. “We have hundreds of characters whose stories we want to tell but that don’t translate well to live-action features.”

Given Marvel’s typical low-capital-risk policy, Lions Gate will fund all production, distribution and marketing for each title and pay Marvel a licensing fee for the character rights. After the homevideo window expires, the two may license the movies domestically and internationally in other entertainment media, including television and video-on-demand. The two will share profits from the deal.

Pact expands on an ongoing production relationship between the two indie shops. In addition to the recent release of “Punisher,” in which Marvel holds an equity position, Lions Gate will distribute theatrical versions of Marvel characters “Iron Fist” and “Black Widow” in 2005 and 2006.

Arad noted some $2 billion in DVDs based on Marvel characters has been sold.

With only 200 staffers but 4,700 comic characters to chose from, Marvel has been on a roll since it emerged from bankruptcy in 1998. The upcoming release of Sony’s “Spider-Man 2” is expected to give Marvel another boost. Merchandising sales have been ramping up in anticipation of the film’s June 30 release.

Marvel wants to mine its library for lesser-known characters who can be transformed into TV or straight-to-vid/DVD projects. “The Marvel universe maintains an outstanding and loyal fan base that craves fresh material featuring Marvel’s superheroes,” said Lions Gate CEO Jon Feltheimer.

Arad said earlier this year that the company is looking for partnerships to develop videogames and live theatrical productions.

In addition, Marvel is trying to retrieve some of the TV and video rights to Marvel character material like “X-Men,” “Spider-Man,” “Fantastic Four” and “The Hulk.” These rights were sold off to New World Animation (now Fox) and Disney during bankruptcy, and license terms will be ending in the next several years.

The Lions Gate-Marvel deal follows closely on the heels of IDT Entertainment’s acquisition of a minority stake in Stan Lee’s Pow! Entertainment in a deal for six animated DVD-premiere movies based on Lee’s stable of characters for release under IDT’s Anchor Bay catalog.

(Simone Kaplan is a reporter for Daily Variety sister publication DVD Exclusive.)