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Indie duo buoys B.O.

'Passion,' 'Fahrenheit' skew final numbers

It came down to the wire, but annual box office for 2004 managed to edge out 2003, with $9.214 billion through Sunday, according to the final tally released Monday by Nielsen EDI, vs. 2003’s $9.166 billion. Victory margin was just $48 million, or a slim 0.5%.

The news was not all good for the major studios, though. In a year of anomalous indie hits like “The Passion of the Christ” and “Fahrenheit 9/11,” total box office grosses for the majors and their subsidiaries dropped steeply by 6.2% from the prior year.

And the 0.5% gain in the overall tally is solely attributable to the 3% increase in ticket prices in 2004, as total admissions fell 2.5% to 1.481 billion. Slip marks the second year in a row of declines, following 2003’s 5% drop.

While the two-year attendance decline does not matter much (for now) to studios — whose box office revenue stream is not solely dependent on number of tickets sold — a continuing decline in moviegoing is a problem for exhibs. They depend not only on ticket sales but also on concessions sales and, increasingly, in-theater advertising. Both income sources are dependent on the number of bodies that come through the doors.

Expressing a view widely held at the studios, distrib prexy Jim Tharp of DreamWorks, which had the year’s biggest picture in “Shrek 2” ($437 million), said 2002’s record-setting box office of $9.271 billion casts an unfair shadow on the past two years.

“I’m not down on the business overall. If you take 2002 down, then everything works in a nice pattern showing increases each year,” he said. Still, he allowed that the slowly slipping attendance is a creeping concern for exhibs.

“We’re a very mature industry, and we’ve never been meteoric going up or down,” said Walt Disney distrib chief Chuck Viane. “There’s slight decreases and increases along the way, and it only takes one event to change the slide.”

Fueled by ‘Passion’

After starting with a bang, 2004 went out with a whimper. Box office saw a huge year-over-year gain in the spring, largely due to “The Passion,” but a relatively flat summer season despite gargantuan hits “Shrek 2” and “Spider-Man 2.” Overall biz was limp through the end of the year, despite late-year hits including “The Incredibles,” “Meet the Fockers,” “Shark Tale” and “National Treasure.”

Before Labor Day, total box office had been running 7% ahead of 2003, even threatening to surpass the industry’s all-time high-water mark, with strong perfs by a diverse array of early-year titles, including “The Passion,” “50 First Dates,” “Starsky & Hutch,” “Mean Girls,” “Along Came Polly” and “Man on Fire.”

Autumn drop

But through the fall and holiday periods, business slackened significantly, dropping 11% behind 2003’s pace.

Studio execs are celebrating 2004’s final numbers, but significantly, “The Passion” and “Fahrenheit” — each receiving a pass from its respective studio — were together responsible for $489 million worth of biz; had it not been for their contributions to the annual tally, total 2004 box office would have been running a steep 4.8% behind last year.

Studio execs argue that such indie blockbusters are a natural and inevitable part of the biz — as evidence by “My Big Fat Greek Wedding’s” $241 million run in 2001 and 2002.

But the 6.2% decline in box office generated by pics distribbed by major studios and their subsidiaries comes after several years of big gains for the studios, despite occasional indie hits. In 2001, studio box office jumped 10.4%, followed by another 10.9% jump in 2002. Even in 2003, when overall box office fell, studio grosses inched forward by 1.5% to $8.924 billion, the most ever for the big studios.

The year just ended looks even worse on an attendance basis, with 9.1% fewer tickets sold for studio films, a drop to 1.346 billion from 1.480 billion in 2003.

While EDI ends its box office year on the Sunday following New Year’s, rival box office tracking firm Exhibitor Relations uses the calendar year ending Dec. 31. Its final figures show total 2004 box office at $9.4 billion, up 1.4% over 2003, with admissions down 1.7% to 1.511 billion.

Among the congloms, Time Warner claimed the biggest share of the U.S. box office, with $1.626 billion and 17.6% of the U.S. market with distribs Warner Bros., New Line, Warner Independent and Fine Line.

But it was hardly a commanding lead. The Walt Disney Co., Sony Pictures Entertainment, News Corp., and NBC Universal each had a marketshare between 16.7% and 11.2%

On a studio level, “Spider-Man 2’s” domestic gross of $373 million cemented Sony’s hold on the title with $1.308 billion and 14.2% of the year’s grosses. But the studio spread the wealth throughout the 16 other pics on its 2004 slate. (Sony includes Revolution titles in its year-end tallies.) For instance, Sony’s No. 2 pic was “50 First Dates” ($151 million), followed by thriller “The Grudge” ($110 million).

“It’s the third biggest year anybody’s had,” said vice chair Jeff Blake. “The secret to our year was a huge blockbuster, but also a lot of success in the mid-range.”

$1 bil mark

Two other studios managed to cross the $1 billion mark during the year: Warner Bros., which came in at No. 2 with $1.215 billion and a 13.2% share, and last year’s champ Buena Vista, with $1.157 billion or 12.6%.

For Warners, it was the fourth straight year it had grossed more than $1 billion. Top title was “Harry Potter and the Prisoner of Azkaban” with $249 million, but three other pics from the studio crossed $100 million: “The Polar Express” ($155 million), “Troy” ($133 million) and “Ocean’s Twelve” ($107 million).

Warners distrib prexy Dan Fellman noted, “It’s the second biggest year we’ve ever had,” trailing only 2001, when WB released the first “Harry Potter” film and “Ocean’s Eleven.”

For third-place Buena Vista, it was the fourth time in the last five years the studio made it past the billion-dollar mark. Mouse House showing was somewhat impressive considering its string of misfires from early in the year, including “The Alamo,” “Hidalgo,” “The Ladykillers” and “King Arthur.” As overall biz headed south after Labor Day, Disney began to find its pace.

“We had a weak first half and then a tremendous close to the year,” distrib topper Viane said. Pointing to Disney’s championship last year, as well as other top-three finishes in recent years, he added, “It always goes back to that same story for us, which is consistency.”

DreamWorks finished fourth with $925 million (10%), with nearly half of that coming from “Shrek 2,” making for the largest year-end total for the studio in its history.

Universal edged out 20th Century Fox for fifth place with $905 million to Fox’s $904 million. However, both studios count their specialty divisions separately from their main studios totals. Include the $122 million from Focus and $173 million from Fox Searchlight, and each studio did more than $1 billion in biz at the wickets this year.

In seventh place is Paramount with $625 million (6.8% market share), followed by “Passion” distributor Newmarket ($406 million, or 4.4%), New Line ($388 million, or 4.2%) and Miramax ($378 million, or 4.1%).

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