A Summer Box-Office Triumph
The summer of 2013 in the motion picture industry will be remembered for many reasons, but at the top of the list should be that it is now in the record books as the biggest ever at the box office, with a tally of $4.75 billion in grosses. It beat the previous record of $4.4 billion set in 2011 by nearly eight percent.
We live in a world that accentuates the negative rather than the positive. Newspapers, magazines and other media focus on crime and disaster to sell their news rather than lighter human-interest stories. And all summer long, the leading industry trades and websites wrote about the films that did poorly at the box office. That is what captured the headlines rather than the successes of Iron Man 3, Despicable Me 2, Man of Steel and Monsters University.
Some of the more interesting happenings of the summer include:
* The top six movies—Iron Man 3, Despicable Me 2, Man of Steel, Fast & Furious 6, Monsters University and Star Trek Into Darkness—were all sequels or reboots.
* The summer’s biggest disappointments—The Lone Ranger, White House Down, After Earth and R.I.P.D.—were all originals.
* Fast & Furious 6, The Heat and The Conjuring were the only films in the top ten that were not in 3D.
* Of the five animated family films distributed this summer, only Monsters University and Despicable Me 2 paid off significantly at the box office.
* A group of smaller films including The Heat, The Conjuring, The Purge and We’re the Millers were surprising standouts.
So with all the ups and downs during this four-month period, are there lessons to be learned and will studio heads seek to alter their summer strategies? Tightening budgets will help studios hedge their bets, but this editor believes that tentpoles will remain the norm for the summer season although studio chiefs might look to sequels rather than original fare. Overcrowding in the marketplace is another major problem and needs to be addressed. With so many films being released in May, June and July, by August audience fatigue sets in and can be harmful to films that would otherwise be successful. A more thoughtful release schedule with films being distributed more evenly across the year would be a good start, although we know that at times studio chiefs are at the mercy of producers who demand summer or Christmas release slots.
On the international side, as is customary now, grosses outpaced the domestic take and some films that did not fare well in North America were impressive internationally. Strong performances across the board and especially in China and Russia along with the U.K., major European markets, Brazil, Mexico, Australia and Japan all helped the bottom line.
Although doing business in China is rocky, everyone wants to be there because of the great potential of this market, now the second-largest in the world. In several situations China saved a studio film; that country generated the two biggest single results from any territory this summer, with $120 million for Iron Man 3 and $108 million for Pacific Rim.
Disney finished the summer internationally in the lead and boasted the biggest release of the year so far with Iron Man 3. Warner Bros. is second and Universal is third. They are followed by Fox, Sony and Paramount.
Now that the summer is over and records have been set, the industry still has a lot to look forward to. Lee Daniels’ The Butler is still strong at the box office and the rest of the year looks very positive with films like Thor: The Dark World, Gravity, Saving Mr. Banks, Rush, The Wolf of Wall Street, Captain Phillips, Star Wars: Episode II—Attack of the Clones 3D and The Hobbit: The Desolation of Smaug. If these films perform as expected, we might set more records in 2013. Who says the movie industry is dead?
Reviewing the Top Headlines
The dog days of August were surprisingly busy this year, as witness these recent news items:
Cyber-locker Hotfile was found liable for copyright infringement for hosting pirated movies and TV shows on its site. U.S. District Judge Kathleen Williams’ decision was the first such ruling on whether cyber-lockers can be held liable for the content stored on their sites. MPAA chairman Chris Dodd praised the court “for recognizing that Hotfile was not simply a storage locker but an entire business model built on mass distribution of stolen content.” The studios had asserted that Hotfile shields those who upload movies and TV shows to its lockers and even encourages them with financial incentives.
The Eastman Kodak Company emerged from bankruptcy and declared that it has commitments to supply film to the major studios for both production needs and distribution to the part of the theatrical market that still depends on film projection. Andrew Evenski, president of Kodak Entertainment & Commercial Films, stated that these commitments run through 2014 or 2015, depending on the studio. Evenski noted, “There is still a very sizable market, particularly in Latin America and Eastern Europe.”
UltraStar Cinemas and Letian Entertainment, a subsidiary of China’s most influential broadcast network, formed a joint venture to develop and operate theatres in China. They will work together on the design, development, construction and operations of digital cinemas and related entertainment facilities throughout China. The companies are currently on track to complete construction of three cinemas by the end of 2013, with plans to build an additional 40 cinemas by the end of 2016. The theatres will be located in the Changsha area of the Hunan province and comprise approximately 10 screens, each with all-digital projection, 3D and concessions. In addition to traditional movie fare, the theatres will offer other entertainment options such as alternative content.
AMC Entertainment, the second-largest theatre chain in the U.S., filed documents for an initial public offering at the end of August. This is AMC’s third attempt at an IPO after failed efforts in 2007 and 2010. With Carmike and Regal stocks trading at their highest levels since the economic crisis of 2008, analysts believe now is a good time to mount an IPO.