Stu­dio poised for a record profit

Uni­ver­sal is out­pac­ing ri­vals with $3 bil­lion in box-of­fice re­ceipts af­ter string of hit films.

Los Angeles Times - - BUSINESS - By Meg James and Ryan Faugh­n­der

Tim­ing is ev­ery­thing. Uni­ver­sal Pic­tures is poised for its most prof­itable year ever af­ter a string of block­busters that have sur­passed ex­pec­ta­tions. This week­end, the movie “Juras­sic World” ram­paged across the globe, scor­ing the big­gest open­ing of all time with $524 mil­lion in tick­ets sold world­wide.

The stu­dio has racked up more than $3 bil­lion in global ticket sales and is out­pac­ing all of its Hol­ly­wood ri­vals. And it reached that mile­stone faster than any stu­dio, thanks to big hits such as “Fu­ri­ous 7,” “Fifty Shades of Grey,” both of which also have grossed more than $500 mil­lion in world­wide re­ceipts, and the plucky “Pitch Per­fect 2.”

“We are hav­ing a very good year,” said Nick Car­pou, pres­i­dent of do­mes­tic dis­tri­bu­tion at Uni­ver­sal Pic­tures. “It’s an em­bar­rass­ment of riches.”

But this is a year that al­most wasn’t.

Three of those films — “Juras­sic World,” “Fu­ri­ous 7” and “Fifty Shades” — were ini­tially sched­uled to run in 2014. Var­i­ous cir­cum­stances — a tragedy, cre­ative con­sid­er­a­tions and a heavy dose of strate­gic mar­ket­ing — bumped them to this year’s slate.

When “Fast and Fu­ri­ous” star Paul Walker died in a car crash in 2013, mid­way through shoot­ing the latest in­stall­ment, the pro­duc­tion was thrown into limbo. Film­mak­ers wres­tled with their emo­tions and whether even to fin­ish the pic­ture.

Early in the pro­duc­tion on “Juras­sic World,” ex­ec­u­tive pro­ducer Steven Spiel­berg de­cided the film, which re­lies heav­ily on com­put­er­gen­er­ated di­nosaurs, would

ben­e­fit from another year of work. Stu­dio ex­ec­u­tives ac­qui­esced to Spiel­berg, who di­rected the 1993 orig­i­nal “Juras­sic Park.”

With “Fifty Shades,” Uni­ver­sal’s mar­ket­ing team lob­bied for the Valen­tine’s Day week­end re­lease date, fig­ur­ing that was their best chance to boost the film’s box-of­fice prospects. Men, who oth­er­wise might re­coil at watch­ing a steamy ro­mance film, would al­low their girl­friend or spouse to se­lect the movie. Their strat­egy worked.

Even the Com­cas­towned stu­dio’s next po­ten­tial block­buster, “Minions,” was first sched­uled to run last De­cem­ber. The spinoff of the hugely suc­cess­ful “De­spi­ca­ble Me” fran­chise was de­layed un­til July 10 to make room for a mas­sive roll­out of toys and other prod­ucts.

Chance cer­tainly played a part in Uni­ver­sal’s block­buster year. But an­a­lysts point out that the stu­dio still needed a strong hand of cards to play — and now it’s cash­ing in.

“It’s just a mat­ter of get­ting as much money from the ta­ble as they can,” said an­a­lyst Phil Con­trino of BoxOf­ “You’re talk­ing about well-paid ex­ec­u­tives be­ing very strate­gic about how they place, how they mar­ket and how they make these films.”

When the fi­nal week­end box-of­fice re­ceipts were tal­lied Mon­day, the movie stunned the in­dus­try by set­ting a do­mes­tic record with $208.8 mil­lion dur­ing its first three days, with nearly half of that com­ing from 3-D screen­ings.

The huge haul boosted Uni­ver­sal past the $1-bil­lion mark in do­mes­tic box-of­fice re­ceipts and into the No. 1 spot among stu­dios with 21.5% of the mar­ket, ac­cord­ing to data firm Ren­trak.

Uni­ver­sal crossed that thresh­old in record time, beat­ing the pre­vi­ous record that was set in 2008 when Para­mount Pic­tures re­leased “Iron Man” and “In­di­ana Jones and the King­dom of the Crys­tal Skull.”

It might still be a tight race by year-end to see which stu­dio comes out on top. Warner Bros. cur­rently is No. 2 with $967 mil­lion and a 20% mar­ket share, and Walt Dis­ney is third with $882 mil­lion and 18.2% of the mar­ket.

Ex­ec­u­tives at Los An­ge­les-based Uni­ver­sal couldn’t re­mem­ber a time the stu­dio fin­ished a year No. 1 at the box of­fice. This year marks a con­trast from last year, when none of Uni­ver­sal’s films made more than $70 mil­lion at the do­mes­tic box of­fice.

Be­yond the shift in sched­ul­ing the films, sev­eral other fac­tors con­trib­uted to this year’s stand­out per­for­mance. Uni­ver­sal has ben­e­fited from a rein­vig­o­rated man­age­ment team, greater em­pha­sis on in­ter­na­tional dis­tri­bu­tion and mar­ket­ing, and movies that play well in 3-D and on Imax screens.

Nearly two years ago, NBCUniver­sal made high­level man­age­ment changes at the stu­dio. Donna Langley was pro­moted to chair­man of Uni­ver­sal Pic­tures, in charge of pro­duc­tion, mar­ket­ing and spe­cialty la­bel Fo­cus Fea­tures. Jeff Shell, who pre­vi­ously ran NBCUniver­sal’s in­ter­na­tional TV di­vi­sion, was brought in as chair­man of Uni­ver­sal Filmed En­ter­tain­ment Group.

As part of the changes, the stu­dio has been ramp­ing up its in­ter­na­tional ef­forts to take ad­van­tage of the bur­geon­ing mar­ket in China and other coun­tries. For ex­am­ple, “Juras­sic World” racked up nearly $100 mil­lion in ticket sales in its first five days in China.

“This movie re­de­fines the strato­sphere of in­ter­na­tional box-of­fice po­ten­tial,” said Jason E. Squire, a film busi­ness pro­fes­sor at USC. “It’s a con­fir­ma­tion of what ex­ec­u­tives have been say­ing for years, which is that the lo­cal mar­ket is ba­si­cally ma­ture, and the real prof­itabil­ity growth is over­seas.”

Uni­ver­sal ex­ec­u­tives also are putting more em­pha­sis on mar­ket­ing, which was ev- ident in how the stu­dio pro­moted “Juras­sic World.” Pre­views of the film aired dur­ing high-pro­file sports events, in­clud­ing a Thanks­giv­ing Day football game and the Su­per Bowl. That pro­voked early in­ter­est that kept build­ing — to the de­light of theater own­ers who just last week were fret­ting about the sum­mer box of­fice.

Higher ticket prices were part of the equa­tion. Au­di­ences were will­ing to pay ex­tra to see “Juras­sic World” on big screens and in 3-D, which can cost about 25% more than a typ­i­cal ticket.

Theater tech­nol­ogy com­pany RealD said 3-D screen­ings gen­er­ated nearly half of the do­mes­tic box-of­fice to­tal for the film and about 65% of the in­ter­na­tional grosses. Imax the­aters posted records, gen­er­at­ing $44 mil­lion in ticket sales world­wide on 806 screens, with about $21 mil­lion of those grosses com­ing from its North Amer­i­can the­aters.

“This is a movie that de­mands to be seen with a group of peo­ple,” said Greg Foster, chief ex­ec­u­tive of Imax En­ter­tain­ment. “It’s not the kind of thing you want to see on an iPhone, on an iPad or alone. They wanted to go see it in a big, gi­ant theater.”

The­aters quickly added ad­di­tional screens to show the film as early au­di­ences gushed about the film and ticket sales heated up. An­a­lysts also at­trib­uted the suc­cess to its fam­ily friendly plot, nos­tal­gia for Spiel­berg ’s orig­i­nal and lead ac­tor Chris Pratt’s rise to star­dom.

“The num­bers just kept build­ing and they con­tin­ued to sur­prise over the week­end,” Car­pou said.

How­ever, the movie’s suc­cess wasn’t a sure thing. Not all re­boots are suc­cess­ful, and on pa­per “Juras­sic World” came with plenty of risk. The film took more than a decade to come to life. It has been 14 years since the last “Juras­sic” film, and “Juras­sic World’s” 38year-old di­rec­tor, Colin Trevor­row, had just one pre­vi­ous fea­ture to his name, a low-bud­get in­de­pen­dent film.

Uni­ver­sal is also not tak­ing home all the money. Leg­endary Pic­tures con­trib­uted about 25% of the es­ti­mated $150-mil­lion pro­duc­tion bud­get for “Juras­sic World,” mean­ing the com­pany will col­lect a sig­nif­i­cant chunk of the grosses af­ter Uni­ver­sal splits the rev­enue with theater own­ers.

The hot streak for Uni­ver­sal is ex­pected to con­tinue. The raunchy teddy bear com­edy “Ted 2” comes out June 26, fol­lowed by “Minions” next month. Later this sum­mer, the stu­dio will re- lease “Train­wreck” with come­di­enne Amy Schumer, fol­lowed by N.W.A. biopic “Straight Outta Comp­ton.” And in Oc­to­ber, the highly an­tic­i­pated “Steve Jobs” will hit the­aters.

For Uni­ver­sal, “Minions” is par­tic­u­larly im­por­tant be­cause the stu­dio owns the film and doesn’t have to split the pro­ceeds with a co-fi­nancier.

Uni­ver­sal has been heav­ily mar­ket­ing the film, which tells the ori­gin story of the mis­chievous, bright yel­low side­kicks from the “De­spi­ca­ble Me” movies.

The 2013 “De­spi­ca­ble Me 2” brought fam­i­lies to the the­aters in droves as it hit $970.8 mil­lion glob­ally, and “Minions” could be even big­ger, box-of­fice observers say. ryan.faugh­n­

Joel Ryan Invision/As­so­ci­ated Press

FANS take a selfie with model rap­tors as part of a “Juras­sic World” ex­hi­bi­tion in Lon­don last week be­fore the movie’s re­lease.

Chuck Zlotnick As­so­ci­ated Press

“JURAS­SIC WORLD” scored the big­gest box-of­fice open­ing of all time with $524 mil­lion in tick­ets sold world­wide over the week­end.

Chuck Zlotnick Uni­ver­sal Pic­tures

CHRIS PRATT, left, the f ilm’s lead ac­tor, con­fers with its 38-year-old di­rec­tor, Colin Trevor­row, on set.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.