The Future of the Sony's Universe of Marvel Characters - Post Venom

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Venom's Box Office - Profit


Not going into too much detail about Venom's Box Office and Profit, for purposes of this post I am going to suggest that Venom concludes its Domestic run with a $200 M dollar total Box Office and internationally at $400 M.   Sony's take of that is $100 M Domestically and $100 Internationally.   For a film that cost in the neighborhood of $166 M including Promotional Expenses that is a profit of $44 M and possible a little more.   
  • Domestically Studio's tend to receive 40 to 60% of the Domestic Box office, with the amount dependent on a Studio's standing, past history, and the movie's most likely take at the box office.  The Theater/chain, and distributor take the rest.   Internationally studio's tend to take as little as 10% in some markets and as much as 40% in others with a number about 25% for all international markets being somewhat average.  
  • For a point of comparison Jumanji: Welcome to the Jungle posted a profit of $275 M and The Amazing Spider-Man 2 around $50 M.

Sony's Leadership Team

Kenichiro Yoshida

Promoted to Chief Executive Officer in February 2018 Kenichiro Yoshida  is a soft-spoken leader with the skills of a politician known for making tough choices and preaching accountability.   He has stated that Sony is an Electronic Company first and foremost and that the other sectors (Music and Movies) must be profitable and provide benefit to the core company.   While he was the Chief Financial Officer he was one of the first executives to public post the earning statements of all the divisions of the corporation making preaching the importance of accountability of each division not only to the leadership team, but shareholders as well. 
His approach is very different than the previous CEO for Sony, Kazou Harai, who was as much a cheerleader and fan of the Entertainment Sectors of Sony  as he was CEO of Sony.  As an ardent supporter of the those sectors Kazou Harai was willing for them to be not as finically successful as other sectors of the Corporation..

Tom Rothman


He recently signed a three year extension, through 2021, to continue on as Chairman of Sony Pictures Motion Picture Group, overseeing all of Sony Film Studios and associated businesses.    A veteran studio executive who has previously oversee Twentieth Century Fox Studios before moving to Sony Pictures, Tom is regarded in the industry as an executive willing to to take chances on limited budgets.   He is also considered a micro-manager and has made changes to scripts, shooting plans, repainted sets, and personnel without consulting a films director and producers.   He has slashed tens of millions from film budgets the day before filming began.   

Super-Hero movie fans will recall that he is personally responsible for delaying the Deadpool film while at Fox.  Also while at Fox many fans point to his decisions and actions in making X-Men: Last Stand, Fantastic Four, Fantastic Four: Rise of the Silver Surfer, Fantastic Four, Daredevil, and Electra as primary reasons for those films shortcoming.

Amy Pascal

The former Chairperson of Sony Pictures Motion Picture Group, Amy Pascal stepped down after the disastrous Hack of Sony Pictures Entertainment group exposing the internal workings of SPE and her "dark side".      After stepping down Amy Pascal formed a new film studio, Pascal Pictures who signed a four year deal with Sony to develop Film and TV projects.    Pascal Studios is currently responsible for the Marvel IPs controlled by Sony including Spider-Man: Homecoming and Venom.

Agreement with Marvel Studios

Amy Pascal, while Chairperson of Sony Pictures Motion Picture Group, signed an unprecedented deal with Marvel Studios allowing Peter Parker to appear in three Marvel Cinematic Movies as a crossover character and having Marvel Studios produce two standalone Peter Parker/Spider-man films while SPE would receive all Box Office Revenue from those two Spider-Man solo films.    Those five films are Captain America: Civil War, Spider-man: Homecoming, Avengers: Infinity War, Avengers 4 and Spider-man; Far from Home.   

Sony Universe of Marvel Characters
Sony has announced the are working on a shared Universe of the more than 900 Marvel Characters whose Live Action Film Rights they control.  Films in early stages of production in Morbious the Living Vampire, Kraven the Hunter, Silk, Black Cat, and Silver Sable.

Sony's Options

1) Renew the Agreement with Marvel Studios
2) End the Agreement with Marvel Studios
3) Sell the Rights to Marvel Studios
4) Expand the agreement putting the entire IP under Marvel Studios
5) Something else.

Commentary

Silk?

One of the More interesting movies on the list of movies in early stages of production is Silk.  Why
not a more well known female character from the "Spiderverse"  like Spider-Gwen (aka Spider-Woman), or Jessica Drew (aka Spider-Woman), or Mayday Parker (Spider-Girl)?
The first two are easy:
Spider-Gwen, Gwen Stacy is not a part of the primary, 616, story line.  The character is set in an alternative universe where Peter parker is killed and Gewn is bitten by the Spider.    Sony does not have the rights for a live action version of Spider-Gwen.
Jessica Drew is technically an Spider/Alien/Mutant depending on which of the four origin stories you want to go with.   In theory her rights are currently controlled by 20th Century Fox.   There is a potential that Marvel Studios also control the IP rights

Mayday Parker is a different story.  I have a theory but its only based on snippets of the Sony Hack.  The contract updated/signed in 2011 has a number of mandatory requirements for Peter Parker.   The contract spells out that he is a straight white student in either high-school or college.   May "Mayday" Parker is the daughter of Mary Jane Watson and Peter Parker.   Hard to explain where she comes from if Peter cannot be old enough to be her parents in Sony's Contract with Marvel.   

There is another interesting tidbit, a Chinese American actress named Tiffany Espensen has portrayed Cindy Moon in both Spider-Man: Homecoming and Avengers: Infinity War.

Over 900 Marvel Characters


Sounds impressive, 900 Marvel Characters.   Sony's contract for Live Action Films includes many characters created for the main line Marvel Comic Book Universe, known as Universe 616.    

Most of these characters are secondary or tertiary characters.  This list of characters includes Peter Parker, Aunt May, Uncle Ben, and Peter's parents Mary and Richard Parker.  Mary Jane Watson, her parents Phillip and Madelaine Watson.   It also includes Peter and Mary Jane's daughter May "Mayday" Parker (aka Spider-Girl) and the thirty to forty supporting characters in her Story Arc.  It also includes Gwen Stacy, her two brothers Phillip and George, her parents George and Helen, her uncle Arthur.  Peter's thirty-five Classmates and thirteen named teachers and five staff members at Midtown High School.   Fifty some named employees of Oscorp.   The named Symbiotes; Venom, Carnage, Riot, Phage, Lasher, Scream amongst others.    It also include secret identities and their public identities separately; for example Green Goblin and Norman Osbourne, Harry Osbourne and Bart Hamilton and Phil Urich.   Lets not forget the Clones...


Is $50 Million in profit enough?

That is the multi-million dollar question in this whole situation.  If Sony's Venom made less than $10M in profit or more than $100M the answer to Sony's decision would be very easy.   It is what happens when the financial result falls right in the middle makes it a difficult question.

There is no clear answer.   If you look at CEO's of Sony Corporation and his stance that all sections of the Corporation must make a meaningful return on investment is sub 30% good enough.   Will Tom Rothman be willing to invest $175 on Silver and Black or Silk? 

The answers two those questions are not as complicated as they seem.   
I asked an Accounting Auditor for major Accounting firm what large Corporations and the answer was 30% to 38% pre-tax.  
Tom Rothman has a history of slashing film budgets, some in the days leading up to shooting the film.   Big Budgets diminish the return on investment.   I cannot see him okaying a production and promotional budget of $175 M for a film like Silver and Black or Silk.   Not even Kraven the Hunter or Morbious: The Living Vampire would get that level of financial commitment.   

To fit the mold I would expect - $50 M return on investment at 38% you are looking at only spending $120 M on film for Production and Promotion.   I spend time at the-numbers.com looking for current films (2016 and newer) and there are only a handful of movies in that range, The Predator, is a recent release - $88 Production Budget - $40 Million Promotional Budget - Loss of $35 Million at the moment.

What I think Sony should do

The best solution for all parties involved would be for Sony to sell their IP rights for live action films based upon the Spider-Man universe to Marvel Studios.   
It is a problem of price.  Marvel and the deep pockets of their owner Disney offered to by the rights back from Spider-Man back in the time frame of 2013 and 2015 with a rumored price tag of $500 to $750 M, the rumor suggests that Sony wanted $1 Billion with a capital B.    Marvel Studios said no and put SPE in an awkward situation.   They had a struggling franchise that with the right leadership could be profitable but after what seemed to be a failed reboot they we in no position to reboot, even a soft reboot, again and did not see light at the end of the tunnel with the current Amazing Spider-Man path.   
The $1 B is not all that bad of price for the Spider-Man IP, it might seem high to you and me, but with three Spider-Man Movies and three secondary movies and a big partner up film, $1 B is in the ball park of the potential profit Sony could make IF they handled the IP properly.  
The flip side of that coin is Marvel no longer needs the Spider-Man IP in the same way it did in 2013/2015 time frame.    With the Disney purchase of Fox about to go through Marvel Studios has a large number of different IP rights to work with, specifically on the villain side where Galactus, Doctor Doom, Kang the Conqueror and dozens of others getting added to the mix.

I just don't believe that Sony will accept the $350 to $500 M Marvel would be willing to offer.

What I think Sony will do

Right now, as hard as it might seem to us as audiences, Sony is kicking themselves for not making the Amazing Spider-Man 3.   Honestly!  With a budget conscious micro-manager like Tom Rothman as CEO I am sure the accountants and executives have suggested a film with a total budget of $225 would have made them MORE money than what they made with Spider-Man: Homecoming.   As strange as it seems thats not out of the question.  

Sony than would have an entire Spider-Man IP working for them, yes Peter Parker would have made appearances in Venom and would appear in the likes of Silver and Black.  That makes those films more valuable and potentially more profitable.   

With that in mind I expect to end the agreement with Marvel Studios and bring Peter Parker / Spider-Man back into their total control and expand the Sony Universe of Marvel Characters.   Just don't expect Tom Holland to reprise his role as Peter Parker/Spider-Man

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Ant-Man and the Wasp - How it should have ended.

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Ant-Man and the Wasp - Honest Trailer

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Mortal Engines - Concept Art Work

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Venom - Tell me again when the Wheels fall off the Bus?

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Last week I predicted a pretty low opening for Venom, $52 Million open weekend and $135 Million total domestic take.   Simply put I was wrong.

Shortly before Solo: A Star Wars Story opened we heard from multiple sources that Advanced Sale tickets we setting records.  According to Fandango.com:

“Solo” had the second-best first day of presales of the year, behind only “Avengers: Infinity War.” “Infinity War” also doubled the numbers set by “Black Panther,” in addition to outpacing the last seven Marvel movies combined, including massive titles like “Thor: Ragnarok,” “Spider-Man: Homecoming,” “Guardians of the Galaxy Vol. 2,” and “Captain America: Civil War.” 
So when Atom.com suggested virtually the same story:
The movie’s [Venom] pre-ticket sales are outpacing recent Marvel Cinematic Universe hits such as Guardians of the Galaxy Vol. 2 , Spider-Man: Homecoming and Ant-Man and the Wasp. In fact, Venom sits third behind Avengers: Infinity War and Black Panther in terms of Marvel’s pre-sales numbers.
Let's just say I didn't buy it, already been burned by that, not going anywhere near that.

Here's the deal, Solo: A Star Wars Story opened at $84 Million, Venom opened at $80 Million and they supposedly were near neck and neck in terms of presale tickets.

I spoke with a local Movie Account guy (no that's not their real title) about the box office and I think he was as surprised as I was at how well the movie did.   What they are quick to point out though is the Movie did well box office ways in specific markets and not across the board.    In the First Tier of Chicago Suburbs multiple screenings of the movie were sold out, a couple hundred miles west on I-94 saw virtually empty screenings. 

The second take away from our talk is that Venom had either great pre-sales or awful walk-up sales, depending on how you want to spin it.  In terms of pre-sales Venom had very strong ticket sales in the five days leading up to its release.

I'll be interested in watching where Venom tracks.  With a poor critical review and cinemascore as well as poor audience review on several web-site (it has a good score on RottenTomatoes.com) it is expected the movie will have a pretty big fall in Box Office for its second weekend.   Superhero movies that follow that pattern drop between 65 and 69 percent; or $24 to $28 Million. 

My accounting friend has even suggested the film could drop 72% which would put the film just over $22 Million domestically in its second frame. 

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Doctor Who - Honest Trailer - Classic

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Doctor Who - Honest Trailer - Modern

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Mortal Engines - NYCC Trailer

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Aquaman - Trailer - Extended

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Venom - It is simply not a good movie

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I tried to go into my screening of Venom with an open mind.  Early social media comments and reviews of the film suggested it wasn't a good but it had its moments.  A couple of reviewers I normally agree with have even suggested they liked the film.   My optimism didn't last long once the lights dimmed and the show started.  In the end I left the screening utterly disappointed.  

I liked Tom Hardy's portrayal of Eddie Brock, but I didn't like Eddie Brock as a character.   There were too many inconsistencies in Eddie Brock's "back story" that just didn't add up.  An example of these inconsistencies is demonstrated as new breed of a no holds barred investigative reporter who you'd expect to have a well followed web presence, instead Eddie Brock holds a job with the local media.      It could have been an interesting twist, but it failed to connect.

Michelle Williams and Riz Ahmed are completely wasted in their roles as one dimension and cliché.  It is even questionable why they have a reason(s) to even be in some scenes in the film.   There is one scene were Anne Weyling (Michelle Williams) is simply just pushing buttons in the background.  I don't remember her saying anything, but I guess she might of had a line in that scene.

The editing and tone of this film is all over the place.  In first part of a scene the film is buddy comedy, along the lines of Dumb and Dumber, as Venom and Eddie interact.   The next portion of the scene the films tries to be Stanley Ipkiss from the Mask with its physical comedy.  The scene ends with Tom Hardy playing both Murtah and Riggs from Lethal Weapon.   It is jarring as well as disconcerting as these transitions occur without reason in the middle of scenes.      

I spent some time trying to decide what film Venom reminded me of.   There are some comparisons that others have quickly suggested, The Mummy (2018), Green Lantern (2011), Catwoman (2004) and The Mask (1994); but those don't quite hit the nail on the head as far as I am concerned.    To me the comparison is more along the lines of the Theatrical Release of Daredevil (2003).   
When Daredevil was released by Fox it was meant to launch a gritty Superhero Universe for a number of Marvel Characters.   The final version of the film was cut from 145 minutes in length to 103 minutes by Fox Executives.   The executives from Fox at the time said the material was extraneous and distracted from the films primary story arc. If you were to watch Daredevil on Disc or TV today you would most likely see the Director's Cut which was released in late 2004.  The additional material in the Director's Cut fills in the primary story arc with added detail that provides the audience a better path towards following the story, provides greater character development and improves the action sequences.     It can be argued that if Fox had released the Director's Cut instead of the Theatrical cut when the film was originally released Ben Affleck still might be playing Matt Murdock. 

Tom Hardy is on the record stating that 30 to 40 minutes of Venom was left on the cutting room floor and that added detail would improve the movie.
"Things that aren't in this movie. There are like 30 to 40 minutes worth of scenes that aren't in this movie... all of them. Mad puppeteering scenes, dark comedy scenes. You know what I mean? They just never made it in."


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Venom - Did the wheels just fall off the bus?

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As of this morning, Wednesday October 3rd, the score on rottentomatoes.com for Venom was 27%.  The first thought that came to mind, why so high?   Honestly that's what popped into my head.
I have heard from people inside the industry that Sony was anticipating the movie to make just under $60 Million Domestically on opening weekend with a total domestic take of $120 to $130 Million. Which until yesterday is below what the box office predictors were suggesting.   The individual I talked with this morning however is worried that with such a negative score, coupled with confirmation of several rumors, the movie will have a hard time attracting non-core audience members to the theater, and that the core audience will only see the film once.

I am not sure if my brain was tuned out but alarm bells should have been going off way back in July when Studio estimates appeared with $60 and $130 million.     

When you look at a movie box office two numbers are important, the Opening Weekend (which is where studios make the most of their money) and multiplier (a movies legs).    A domestic movie opening at $65 Million and ends with a total domestic take of $176 it has a multiplier of 2.7.   That is considered a good Multiplier, not great, but close.   A movie that opens at $65 million and ends at $181 has a multiplier of 2.8 is almost great as 3.0 is consider great.   
A domestic box office of $60 million and a total domestic take of $120 Million has a multiplier of 2 and would be considered abysmal or bad.   The first two movies are Captain America: The First Avenger and Thor both of which opened with roughly a $65 million opening and multiplier of 2.7 to 2.8.  
For Marvel Films, not just films in the Marvel Cinematic Universe, but all Marvel films on Punisher Warzone ($4 M / $8 M), Elektra ($12 / $24) and Fantastic Four (2015) ($25 / $56) have the kind of multiplier we are seeing predicted by Sony.     Most Marvel films are in the 2.6 to 2.8 range.

What's more of an issue is that this film is being release in a very non-competitive time slot (early October) where it should have little competition for viewers over the next three weekends.  I was asleep at the wheel.

The other challenge for Venom is it's score on rottentomatoes.com, metacrtic, and other aggregate score web-sites.       On rottentomatos.com this morning it has a score of 27%, which means that only 27% of the reviewers scored the movie as a C+ (2.5 out 5 stars) or better.   Metacritic score, currently at 35, is a measure of how well the film scored with critics.   Scores of 81 or better are considered great, 61 to 80 are considered favorable, 41 to 60 mixed, and 20 to 40 unfavorable and below 20 just plan bad.   The people I talked to suggested that Sony was expecting a rottentomates.com score in the neighborhood of 55 to 60 and metacritic score in the 50 to 60 range.   Neither score is looking like it is possible today.

Where do studios get their estimates, test screenings.   You show the film to 300 random viewers and gauge their results.   In recent years Movie Studio test screening scores and Critical Reviews have become more aligned or in tune to one another.  Occasionally a movie with high test scores will get poor critical responses, The Mummy, and even more rarely a movie that does poorly with the test audience, School of Rock, will get a solid or good critical reception.   In general these scores now-a-days are fairly well aligned.  Venom scored in the mixed to positive range with test audiences and is now getting lower scores from critics.

During the spring of 2017 executives Universal Studios were cautiously optimistic about The Mummy, a reboot starring Tom Cruise the hoped to launch their Dark Universe.    The movie had done fairly well at test screenings they had an expectation of $50 to $60 million in the opening frame and multiplier of 2.7.     The movie had "momentum" in early May 2017 before a the first box-office web-site lowered their estimate based upon the negative reception of the final trailer.   The movies momentum and hype crashed and the movie project was only projected to take $39 Million in the final estimates, before taking a actual of of only $31 M.

This year the momentum for Venom has been building, even last week movie box-office predictors were seeing high social media numbers and excitement for the film before the breaks were applied right before the launch.  So Venom is not following the exact same path as The Mummy; its path is more aligned with The Amazing Spider-Man, another Sony Marvel film, where the wheels fell off basically as the movie launched.   It was projected to be in the $75 to $85 million range for its opening weekend and slid in at just $62 Million a 20% drop.

If Venom plays out like The Amazing Spider-Man in terms of box office it should see a 20% drop from the box office predictions of last week, or $52 million.   And if continues to score in its current range the legs of 2.5 it should have a final domestic take of $135.

While those final numbers are in line with Studio Estimates they are clearly not as high as some prognosticators have suggested.

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Spider-Man: Into the Spider-Verse: Trailer

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