The international worldwide box office has never been this
big or this competitive. 2018 proved to be a record year as Comscore reported
that the worldwide box office peaked at $41.7 billion. This is already a 2.7%
upward shift from last year’s $40.6 billion and marks only the second time ever
that it has cracked $40 billion.



At a time when blockbuster films are all but devouring the
lion’s share of traffic at the international turnstiles, we thought it
appropriate to pause and take a look at just what these figures mean for the
future of film and film releasing. Is Hollywood cannibalising itself by
creating these juggernauts?



Well, let’s take a look at the latest numbers sensation, Avengers: Endgame. The film broke a few records. It had the biggest international opening of all time raking in just over $1.2 billion in its first 11 days of release, an unheard-of figure. 



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As of May 13, Avengers: Endgame is sitting on a worldwide total of $2.5 billion and is guaranteed to go even higher in the weeks ahead. But where does this leave variety, where does this leave the smaller film, the adult-orientated film, the arthouse film?



The reality is that the mere existence of films like Avengers: Endgame means that this leaves such kinds of pictures nowhere. It’s impossible for any other picture to compete with a $356 million budget superhero movie with at least another $200 million in worldwide marketing costs behind it. 



Hollywood’s technique is complete saturation and to kill the competition. So while the film may have performed exceptionally, let’s be honest, with the kind of market saturation, brand name power and the sheer size of the international release, it should have.



Another important point when reviewing this film’s incredible box office performance is again to take into account the all-important Chinese market. Avengers: Endgame has already grossed over $600 million in China accounting for over a third of its total gross already. 



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But how has it performed from a historical perspective? When looking at ticket prices adjusted for inflation based on grosses in the United States only, the film slips all the way down to number 24 on the all-time grossers list. Top of the pops is still Gone With The Wind from 1939, followed by the original Star Wars from 1977. 



This brings me to my next point. Whatever happened to films that had legs, such as Steven Spielberg’s E.T. from 1982 or The Exorcist from 1973? The grosses of these films adjusted for inflation would be billions of dollars worldwide. The key to their ongoing longevity is that they had legs. 



These were films that discovered their audience week by week and although they were smash hits, they often grew in terms of their numbers from one weekend to the next as word-of-mouth spread, increasing their turnover. 



In this age of instant gratification and mass saturation, Avengers: Endgame is doing the opposite – it dived by 70% in its second week, numbers showing no signs of any real longevity.



So is Avengers: Endgame going to be the ultimate releasing strategy going forward? Does one push the film out into as many cinemas as possible, spend the equivalent of a small country’s GDP in terms of marketing power and try and pack in as many viewers into your first seven days with sell-out performances, then take the money and run?



Speculation is always circumspect so I’d like to pose
another question. If film is a business, should the business strategy be hit
and run? 



Will any of these films have the kind of longevity from a film fan perspective or will they disappear into the chasm of disposable entertainment. 



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Again, only time will tell. Where to from here for Hollywood? 



This kind of maximum impact output surely isn’t sustainable
and is surely too risky. You can’t spend half a billion dollars on producing
and marketing a film and then have any kind of risk in terms of the film not
connecting with its broad-based audience. 



All you need is two or three box office bombs and you’ll
sink a studio.



The old cliché that you can’t put all your eggs in one
basket exists for a reason. If entertainment tastes continue to split into
niches, the theatrical movie-going experience will also continue to take a
backseat to Video On Demand, and Hollywood may just be shooting itself in the
foot with this glut of summer tent-pole pictures. 



I sincerely hope this doesn’t mean the death of
“word-of-mouth”. Bigger does not necessarily mean better. 



– Robert Haynes is Executive Producer of entertainment at CNBC Africa and owner of film and TV production company, 42nd Street Films, in Johannesburg.

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Worldwide Box Office, The Best It’s Ever Been

At a board retreat in Orlando, Florida, in 2006, a pair of senior Disney executives predicted a seismic shift in the media landscape — one fueled by consumers who would enjoy unprecedented access to content. Their plan? Amass strong enough entertainment brands and franchises to grab the attention of viewers awash in choices.



That insight, part of a “Disney 2015” presentation by its CFO at the time, Tom Staggs, and corporate strategist Kevin Mayer, was delivered a dozen years before Netflix briefly surpassed Disney as the world&#8217;s most valuable media company in 2018. It would inform an aggressive buying binge, in the mold of the Pixar Animation Studios deal of 2006, that would roll up some of the world&#8217;s most recognizable entertainment brands under the Disney banner — Marvel Entertainment, Lucasfilm and 21st Century Fox. These form the foundation of the coming Disney+ streaming service, which CEO Bob Iger will discuss in detail at an investor day Thursday on Disney’s manicured studio lot in Burbank, California.



Analysts say Disney’s library of blockbuster films and popular TV shows, bolstered by its recent acquisition of Fox’s film and television assets, give it a competitive advantage that should help attract subscribers — even at a time when established rivals, like Netflix and Amazon Prime Video, have gained a substantial head-start.



Disney and Fox together account for 47% of the top 100 films of all time, based on domestic box office. That’s more than double the nearest competitor, Warner Bros., with 20 hit movies. The combined Disney and Fox libraries also command the largest share of the 100 most popular TV shows, as ranked by IMDB. &nbsp;



Disney plans to mine its Pixar, Marvel and Star Wars franchises for original shows that will appear exclusively on the streaming service, including a live-action Star Wars TV series&nbsp;The Mandalorian, an animated series&nbsp;Monsters At Work, with Billy Crystal and John Goodman reprising their roles as Mike and Sully, and a series based on the Marvel archer character Hawkeye, starring Jeremy Renner.



“The amalgamation of Disney’s and Fox’s libraries will create an unparalleled combination of great, hard to recreate and memorable content,” said media analyst Michael Nathanson.



Nathanson predicts Disney+ will attract 7.1 million subscribers in its first year, growing to nearly 24 million by the end of fiscal 2022.



A question remains about whether a content company like Disney will be able to match Netflix’s technological prowess. The Los Gatos-based streaming service has been able to draw from its vast trove of user data to deliver recommendations that keep its 139 million global subscribers watching, month after month, and inform programming decisions.



Disney has stumbled on previous digital endeavors, such as DisneyLife, a U.K.-based streaming service that launched in 2015, charging £10 a month for access to some 400 movies, 4,000 TV episodes as well as songs and books. Despite a price drop, it has failed to catch on with subscribers, according to numerous published accounts.



The success of Disney+ is something Iger is staking his legacy on, describing it, during a recent investor call, as “our number one priority.”



That’s a major strategic shift for Disney, which had enabled the growth of Netflix through lucrative multi-year deals, such as the one in 2012 that gave the streaming service exclusive TV rights to new and catalog films, and another, the following year, that handed Netflix access to Marvel’s muscular superhero roster — with ABC Television Studio developing original series based on comic book characters Daredevil, Jessica Jones and Luke Cage.



Netflix became the de facto syndicator for a number of TV shows, noted Nathanson.



The inescapable toll of cord-cutting, fanned by popular services like Netflix, caused a re-calibration inside the Mouse House. Disney’s traditional cash cow, ESPN, has shed 13 million domestic subscribers from its peak in 20013, and Disney Channel also has lost millions of pay TV viewers.



Iger shifted course in 2017, announcing that Disney would pull its content from Netflix and launch its own service in 2019. That August, the company invested $1.58 billion to acquire a majority ownership of BAMTech, the MLB-founded video streaming technology that will power Disney+. That same year, in December, Disney announced its ground-breaking deal to acquire much of Fox, a move that would position Disney as the world&#8217;s preeminent entertainment company — and bulk up its library as it prepares to do battle with Netflix.



The $71.3 billion Fox deal, which closed in March, reunited the X-Men and Fantastic Four with the rest of the Marvel universe, added&nbsp;The Simpsons&nbsp;and&nbsp;Ice Age&nbsp;to Disney and Pixar’s animated roster, and brought James Cameron’s four sequels to the box-office blockbuster Avatar under the Disney banner. It also gave Disney a controlling interest in Hulu, a streaming service jointly owned with Comcast’s NBCUniversal and AT&amp;T’s WarnerMedia, which has amassed 25 million subscribers.



Disney announced a sweeping corporate reorganization in March of 2018, to consolidate its streaming operations under the executive who’d overseen its major acquisitions, Kevin Mayer. Previously, efforts had been fragmented among the different business units, with the film and television groups pursuing different digital strategies, say former insiders.



“Depending on how aggressively Disney intends to invest, and their willingness to accept compressed profit margins, the company has a chance to become a meaningful competitor to Netflix and Amazon’s Prime Video,” wrote Brian Wieser, a long-time media analyst who now oversees business intelligence for GroupM, one of the world’s largest media buyers.



-Dawn Chmielewski; Forbes Staff

Tag: Star Wars

FORBES AFRICA SOCIAL MEDIA

Worldwide Box Office, The Best It’s Ever Been

How Disney’s Investment In Entertainment Brands Like Marvel and Star Wars Will Power The Launch Of Its New Streaming Service