A Geeky Viewpoint

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.   

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..

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.

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...

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.

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.

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