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$20 Million Now, $20 Million Then - How Star Wars Changed Movie Math

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There he goes, there goes Speed Racer -- right into a wall: Last weekend Speed Racer crashed and burned at the box office, pulling in a feeble $20 million. This gives 2008 its first major SF/F flop and assures that Warner Bros and its financing partners are going to eat most of the rumored $150 million production cost of the film (not to mention the additional tens of millions for marketing). Right now, the Wachowskis are sitting in a dark room, looking at the numbers and realizing that they really do have to stop cruising on the cred they earned on the original Matrix flick -- that's all gone now.

If Only the Wachowskis Had Released Speed Racer 31 Years Earlier
Because here's something interesting: On July 15, 1977, after several weeks in limited release, Star Wars had its official wide release and pulled in $6.8 million for the weekend, which, adjusted for inflation, would be about $20.9 million dollars today. Star Wars would go on to make more than $300 million in its initial release (a gobsmacking $930 million or so in 2008 dollars), and, of course, go down in movie history, spawning a franchise that is even now dropping films into theaters. (The animated Clone Wars, heading to screens in August.)

So, the question, which the Wachowskis might ruefully ask, is: Why does a $20 million opening spell disaster for Speed Racer today when its equivalent was absolutely fantastic for Star Wars, back in the day? Movies are still the same strips of images on film stock in 2008 as they were in 1977 -- has everything else about movies changed so much?

Well, yes. Movies are physically the same objects they were 31 years ago (although probably not for long, as more theaters go digital), and people still go to theaters to see them. But everything else about the mechanics of making money at the movies has changed.

In 1977, for example, if you were suggest to a movie executive that you should open a film in 3,600 theaters, like Speed Racer was last weekend, you would get a blank, non-comprehending stare. Star Wars -- and nearly every other movie of the time -- had its debut on just a few dozen theaters: 43, in the case of Star Wars, all clustered in and around major metro areas. If a movie did well, they'd add a few dozen more screens the next week, and a few dozen more the week after that, and so on. In all of 1977, the movie never made it into more than 1,100 theaters -- less than a third of Speed Racer's opening weekend count.

You would think that smaller number of theaters would cut down on the amount of money you could make -- and indeed, all through 1977, Star Wars never managed to make more than $7.7 million a weekend (about $25 million today). But what Star Wars could do that Speed Racer and other movies today generally can't is just keep running. From its first limited release on Memorial Day weekend, 1977, Star Wars stayed in movie theaters for nearly an entire year, and for that year, experienced very small drop-offs in business from weekend to weekend: Between ten and twenty percent each weekend. Compare this to last year's Transformers, which made $300 million in six weeks -- and experienced 40 to 50 percent dropoffs in attendance each week. In both their eras, Star Wars and Transformers are state-of-the-art blockbusters, in terms of how they made their money -- it's just that the state of the art evolved.

How It Evolved
One: The studios recognized that when a movie is released at the right time -- say, summer -- you can get more people (read: Kids) into the theaters and make more money faster. Two: The studios have changed the way they share money with theaters, so now it's no longer as advantageous for a theater to keep a film for a long period of time. Three: Theatrical release is no longer where movie studios make most of their money; it comes from home video, toys and other ancillary markets.

When did all this start changing? If you guessed, oh, probably right after Star Wars came out, you'd be perfectly correct.

Speed Racer is doomed: There's no chance that Speed will get up to speed from here. Tomorrow the family audiences that were supposed to go see it will go flock to Prince Caspian instead, and then the weekend after that, Indiana Jones is back. Speed Racer will be in the second-run movie theaters by the first week in June, with nothing to else to look forward to until its financial afterlife on DVD and HBO. All because of two $20 million opening weekends: Its own, and the one Star Wars had, adjusted for inflation, 31 years ago.

Winner of the John W. Campbell Award for Best New Writer, John Scalzi is the author of The Rough Guide to Sci-Fi Movies as well as the novels Old Man's War and the upcoming Zoe's Tale. His column appears every Thursday.

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Filed under: John Scalzi
Tags: speed racer, star wars

Comments

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My irritance is that no one really looks at how people like the movie, just how much money it makes.

Oh, and why the hell does Entertainment Weekly send the reviewer that HATES anime to review this? And that magazine is owned by Time Warner...are they sabotaging themselves?

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John -

You wrote, "When did all this start changing? If you guessed, oh, probably right after Star Wars came out, you'd be perfectly correct." My sense when I read this was that you were short-changing Jaws with your analysis, and a visit to Wikipedia (insert all the usual caveats here) seems to confirm my instinct:

"Jaws was the first film to apply the concept of 'wide release' in its distribution pattern. As such, it is an important film in the history of film distribution and marketing.

Up until Jaws was released, films had opened slowly, usually in a few theaters in major cities, then 'building' across the country—distributors sending more prints to more cities, as the film was perceived to be a success. However, Jaws was the first film to use Sid Scheinberg's scheme of 'wide release'—the until then unheard-of practice of opening the same picture nationwide, in hundreds of screens simultaneously, coupled with a nation-wide marketing campaign. Scheinberg's rationale was that nationwide marketing costs would be amortized at a more favorable rate per print than if a slow, scaled release were carried out. Scheinberg's gamble paid off, Jaws becoming the first film in motion picture history to cross the $100 million mark. The success of Jaws created the new paradigm of distributing and marketing major motion pictures simultaneously, a business practice which continues today.

When Jaws was released on June 20, 1975, it opened at 409 theaters. The release was subsequently expanded on July 25 to a total of 675 theaters—until then the largest simultaneous distribution of the same film in motion picture distribution history. On its first weekend, Jaws grossed more than $7 million, and was the top grosser for the following five weeks. During its run in theaters, the film beat the $89 million domestic rentals of the reigning box-office champion, The Exorcist, becoming the first film to reach more than $100 million in theatrical rentals, the money paid to the studio distributors out of the total box office gross. Eventually, Jaws grossed more than $470 million worldwide (around $1.85 billion in 2006 dollars) and was the highest grossing box-office hit until Star Wars debuted two years later.

Jaws and Star Wars are considered in retrospect to have marked the beginning of the new business paradigm in American filmmaking, and the beginning of the end of the New Hollywood period."

Link here:

http://en.wikipedia.org/wiki/Jaws_%28film%29

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La Dracul:

I certainly agree there's much more to movies than what they make. However, movies like Speed Racer are ostensibly designed to rake in money hand over fist, which is why the get big budgets and huge marketing pushes; it was intended to be a summer tentpole for Warner Bros. In that respect, talking about the money is legitimate.

Benedict:

You are correct that Jaws was huge and made the case for the concept of a wide release (although what a wide release was in 1975 is something different than it is today). The way I see it, actually was that Jaws showed it could be done, while Star Wars showed it wasn't just a fluke. After Star Wars distribution changed for certain. And then of course, both Spielberg and Lucas used those changes to their advantage.

That said, what Star Wars did that Jaws didn't -- and which was ultimately as influential if not more so -- was establish the idea of ancillary lines of revenue as a primary source of income (rather than a nice extra). It's well known that George Lucas took less upfront money to direct Star Wars in return for keeping the merchandising rights (and the rights to the sequels). It was the smartest thing he ever did, and the dumbest thing 20th Century Fox ever did. Lucas built a film empire (in movies and in movie technology) with the proceeds; 20th Century Fox, on the other hand, got distribution fees from there on out.

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I think another difference between than and now was that in my memory of back then, most theatres had only two or three screens at most, not the dozen or more of modern multiplex cinemas. So when you showed up at the movies back then, you only had a couple of movies to choose from. Nowadays, you have a dozen or more, which means that competition for the consumer's attention is much more fierce.

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I saw Speed Racer last week, to a house as packed as the Iron Man I saw the night before (noting that yes, that's a week into its run). I enjoyed them both immensely, for slightly different reasons.

To me, SR is extremely successful, as it created an enjoyable film with its vision intact -- a live-action cartoon. It certainly suceeded better than previous cartoon transitions, and still felt like the hyper-real world of anime, even with the live actors. Unlike "Phantom Menace", the unreal sets of the World Racing League didn't make me go "Oh, cool digital scenery" -- it just worked for its own purposes.

Iron Man, on the other hand, is a nice little Science Fiction romp. Downey's glee at his own cleverness matched my own watching him, and that made it work. On the other hand, certain silly slapstick (splat on the wall after the first jet test without requiring even a bandaid on the nose; falling through a roof, piano and floor) knocked me out of that 'reality' -- something that Speed never did to me.

On the other hand, I understand that the audience is limited here: it's mostly 30s-to-50s folks, dragging their too-young kids (whining behind me) to their own nostalgia. I predict that DVD sales will be proportionately higher than their box office, because we of the previous generation still spend money on nostalgia.

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My kids asked to go see Speed Racer (and yes, they've seen the original series on TV). We all enjoyed it immensely. I'd like to believe that it SR will benefit from the long tail, but I know that John's correct...it won't. The summer is too crowded with kid-friendly fare being launched in rapid succession. I consider SR to be a success as a movie, but it will be viewed as a commercial failure.

I think Star Wars was a perfect storm for film and business. Planet of the Apes was one of the first truly heavily-marketed licenses, with tons upon tons of toys, comics, spin-offs and licensees. Jaws was the first truly wide-released success. But Star Wars was the first one to combine those and redefine the whole notion of what a blockbuster could be.

And hugh57 is right...your choices and venues were far fewer, then. Now I have six multiplexes within 15 minutes of my house; in 1977, we had to drive 30 minutes to see Star Wars at the one theater that had it near us. Films would stay in a theater for months with regularity. Now, with film-makers like Kevin Smith making films that break-even based on the video-distribution rights alone, it's a whole new ball game.

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Why is Speed Racer a SF/F film? As I remember the cartoon it was set in the present and didn't have any SF elements.

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The Mach 5 is not science fictional?

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The Mach 5 is a car that uses Pogo Sticks, buzzsaws on extending arms, spikes that emerge from it's wheels (without puncturing them, mind you), auto re-reinflatable tires and can launch a robot bird.

The original series had mad scientists with 'sleeper gas' and undersea bases, mammoth cars, cars so fast you need performance enhancers to handle them, giant robots, giant animals, robot animals and LASER TANKS.

If that isn't Science Fiction, what is?

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Another reason for low-volume openings was the cost of prints - more could be made and start to make their way around the country as the money rolled in. Or not, if it didn't.

These days it's a download. Or something damn digitally near to it. So, particularly in the case of a turkey as large as this one (my kids and I reckon it pipped Pooh's Heffalump Movie to be the new worst, if only because it was over 2 hours long) the trick is to get as many unsuspecting customers into the theaters as possible before the word gets round.

Someone mentioned the long tail. In my day on www.hsx.com, we'd talk about a movie having "legs". I'd guess this one has stumps. Short ones.

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Here's another thing to think over...I looked in "Entertainment Weekly", and they had the movie reviewer that HATES anime to review this. I would've prefered someone that was unbiased to review this because I know she's given low marks to other anime features.

BUT, "Entertainment Weekly" is owned by Time Warner, which put out the film. Are they sabotaging themselves?

Thankfully, that hasn't stopped WB from thinking of a sequel, or their involvement in "Akira" and the English-language "Death Note"....

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LaDracul:

"Entertainment Weekly" is owned by Time Warner, which put out the film. Are they sabotaging themselves?

There's a pretty high editorial wall between the movies and the magazines at TW (whose magazines also include Time and People), and if there weren't then the magazines would take a profitability hit. So having EW be a cheerleader for TW films would be something like sabotage as well.

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What I mean is, send the person that didn't have an opinion either way. It would've been a mistake to send an otaku to review it.

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Everyone has opinions. The mark of a good reviewer/critic is not that they are a blank slate, and reviews are both implicitly and explicitly subjective in any event. The role of the reviewer/critic well communicate to the reader what the experience of the film was. When I was a full time critic there were certain films I had a natural affinity for and some I did not; I had a tendency to note those in the review to help readers triangulate from there.

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Yeah, I was one of those kids who went to see Star Wars three times in that glorious year. I went three times because I remember (distinctly) feeling gloomy that I would never be able to see it again. I even remember asking my mom how good the chances would be of a network picking up Star Wars to play on the TV; when she told me she didn't think that would happen, I felt very sad. She took me to see it again because we figured we'd never have a chance to see it again: VHS and the like were still a ways away from settling this, and, once VHS did finally come out, one of the first movies I wanted to see was Star Wars.

My point is that people in 1976 didn't have the DVD to look forward to. They didn't have a choice about ever seeing a film again unless a network bought its rights. That was why they were left to the theaters longer, so people could get their fill of them. Today, half the movies I want to see I just wait for the DVD to come out.

BUT: I realize your point, and it's well made. An opening weekend of 20mil wouldn't have sucked eggs in 1976, but it does now because so many of us--me included--didn't go see the big screen version because we're waiting for the DVD. Now the production houses have to get the movie out of the theaters quickly, so they can get it into the DVD watchers' hands.

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