News
Analyst: smaller summer blockbuster potential
By Robert Marich
May 3, 2009—Box office is running a booming 17% ahead of last year’s pace, but by July the rolling year-to-date (YTD) comparison will narrow, believes investment outfit Barclays Capital.
As autumn starts, the YTD gain will be in the 9-12% range, forecasts a Barclays report on the movie business. Barclays’ forecast for summer season (mid May through August) is for merely a 1.1% increase in box office, so that summer’s modest performance waters down big gains from January-early May, according to Barclays’ calculation.
Why is late summer a key? The Dark Knight premiered July 18, 2008, beginning an epic theatrical run generating an astronomical $533 million in domestic box office. Right now, films opening in 2009 face easy comparisons to the same weekends in 2008. Things will get tougher starting in July.
For summer 2009, “we estimate there are 15 films with $100+ million potential, versus 17 in 2008,” says the report. “Only one film, Transformers: Revenge of the Fallen from Paramount/Viacom has the potential to break through the $300 million level.”
The report also estimates prints and advertising expenses – or domestic market costs – for summer 12 films. Getting the biggest marketing pushes estimated at $100 million each are Warner Bros.’ Harry Potter and the Half Blood Prince and Transformers sequel. The smallest marketing spend for the 12 movies is $50 million for two films. An average is $75 million.
Barclays estimates total production costs of summer films is 8% higher for “tentpole” films – the biggest films in the prime release slots. The summer 2009 films are more heavy with sequels than 2008, which fuels higher production costs. That's because talent salaries rise whenever coming off a hit.