Is Universal Putting Its Streak at Risk by Pitting ‘Pets’ Against Superheroes?

Could a petulant pet finally bring it all to an end?

Universal’s streak of hits has reached the point where rivals are wondering how long it can last. Next summer, for example, when other studios will unfurl their superhero slates, Universal will release “The Secret Life of Pets,” a 3D animated film about an angry pooch. Of course, “Pets” is coming from Illumination Entertainment, the same team that created “Minions,” which grossed $1 billion worldwide this year. Still, it’s worth considering whether the studio’s offbeat strategy can continue to dominate.

Universal’s top executives, Jeff Shell and Donna Langley, are playing it cool about their good run. Only CEO Steve Burke, himself usually very cautious, went so far as to volunteer to the Wall Street Journal: “Our expectations for the film business have risen. We expect the overall water level to rise on a sustainable basis.”

His comment raises a good question as to the sustainability of Universal’s winning streak. Can the studio keep pumping out the likes of “Jurassic World,” “Fast and Furious 7,” “Pitch Perfect” and its sequel, “Fifty Shades of Grey” and its big sleeper, “Straight Outta Compton”? Universal and Disney between them accounted for 40% of the box office this year — that’s almost an oligopoly. Disney had to suffer through “Tomorrowland,” but Universal was spared a major loser.

I thought it would be instructive to take a look at previous studio winning streaks to determine what factors finally brought them down. Were there any common denominators?

It was naked ego that brought down Paramount’s high-flying regime in the mid-’80s — a team led by Barry Diller, Michael Eisner and Jeffrey Katzenberg. Their boss, Paramount’s corporate CEO, Martin Davis, couldn’t stand reading about the talents of his three killer executives, and refused to grant them the raises they demanded and deserved. They all fled to better jobs, and Paramount tanked.

By contrast, rigid rules about corporate succession effectively spelled the end of the superbly successful Alan Horn-Barry Meyer regime at Warner Bros., as Time Warner hierarchs decided they needed a strategy for the future more than a plan for the present. Stung by ageism, an angry Horn moved to Disney in 2012, and this year has been a bumpy one at the box office for Warner Bros.

At DreamWorks Animation, after a string of hits, management overreach cost the company its momentum, as Katzenberg decided to focus his attention on corporate expansion. Creative decisions were turned over to a team that wasn’t up to the job, resulting in major write-downs.

At Fox, conflicts over management style resulted in the termination of Tom Rothman’s successful nearly two-decade run, as Rupert Murdoch reacted to arguments about the balance between budgetary discipline and creative autonomy. Rothman was fired and moved to Sony. Rampant ambition undercut several successful studio regimes. Frank Yablans, president of Paramount in “The Godfather” era, confided to the press he’d prefer to be president of the United States rather than head of a movie company. He ended up with neither job.

Do these bizarre patterns of self-destruction lend any insight into what may eventually take down Universal? To an outsider, the studio at this point seems both stable and mature, but there are rumblings from Wall Street that may pose a threat. More franchises are needed on the slate, say the number-crunchers — more tentpoles, more sequels and, yes, more superheroes. Next year, to be sure, Universal will release a new “Bourne” film with Matt Damon, and dust off a follow-up to “Snow White and the Huntsman.”

But what, in the end, will carry Universal’s stalwarts through the new year? Well, there are always the angry pooches of “Secret Life of Pets.” They might ring up another billion.

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