More musings on Speed…

Updated on May 14, 2008 By Ken Begg 16 Comments

Jabootu correspondent John Nowak noted, following my recent post noting that Speed Racer did rather worse than originally reported, “Isn’t it a little frightening that a film can be #3 in a weekend and still lose money? The economics of film are very scary…”

You’re not kidding. In fact, the truth is that Speed Racer could have won first place and still lost money. Let’s say it came in not third with a paltry $18.56 million in the till, but grabbed Iron Man‘s totals for the weekend, first place and $48m. Obviously, the fillm would have been better off. The publicity effects of being a #1 film should not be discounted; the movie would have made more when sold to TV, for instance.

Even so, let’s say that Warners’ Brothers investment in the film was $150m. That’s taken at face value their reported budget of $120m, plus, oh, another $30m for advertising and prints, etc.

Let’s say further that, even in the face of the emergence of already well-reviewed Prince Caspian this weekend, Speed Racer than faced a fairly healthy 50% drop-off. (About what Iron Man did this weekend.) That would put its domestic take about $75m, with maybe $40-50 of that going back to the studio, depending on their deal. After that, the film would have been lucky to stagger across the $100m mark (especially after the release of Indiana Jones), with the studio gleaning, at most, $60-70m of that.

Obviously at that point you are already relying on a very healthy foreign take to get you into profits. Many films do prosper that way, but this doesn’t seem to be one of them. (The foreign take this weekend? $12.6m.) In the end, had it in fact hit #1 with $48m, it may have eventually after DVD and whatnot made the studio a slight profit–maybe. However, if the whispers are correct, and Speed Racer actually cost around $160m, not $120m….

Yeah, the movie business is due for a major shake-up soon.

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  • Hey Ken – sorry to bug ya. Would you fix the broken link to my blog site on your homepage? It’s: http://www.henrybrennan.com/
    Thanks. I will be starting to do reviews on Monster Shack once I hit the Philippines – then branch out from there. Thanks, again…

  • By the way – regarding “Speed Racer” – this was an obvious mistake from the get-go. In my opinion, their best bet is to try to build up some kind of cult following in Japan. But to be honest, they would have had a better shot with “Astro Boy” (“Atom Boy”).

  • Henry — Done and done. I hope the move goes well. Please specialize in Philippe horror movies and such. That would be awesome.

  • Ericb

    Is it even possible the way the current movie market works for a blockbuster the likes of Jaws or Star Wars to ever happen again? With major multi-million dollar “blockbusters” being released every weekend it seems impossible for one movie to dominate an entire summer.

    This may be a bad analogy but could it be possible that despite the huge sums being thown arount that the modern movie industry could come to resemble the b-movie industry of the 50s where companies had to plow all of their profits into the next feature just to keep their heads above water?

  • No. When Jaws was one of the first ‘wide releases,’ it opens on 409 screens. (Back in the day when a theater generally was just one large auditorium.) I remember Earthquake literally played at the local Randhurst Theater (a huge one-screen affair that obviously no longer exists) for NEARLY A YEAR. That’s right only played that one film for a year straight.

    In today’s multiplex world, a film like Iron Man probably opens on 4000 screens, playing at most venues every 20 or 30 minutes, meaning that most everyone who wants to see the movie sees it the very first weekend. Iron Man lucked out with Speed Racer stumbling, as it allowed for probably a higher retention rate than if SR had hit big. But yeah, with the huge number of would be blockbusters out there, it’s very cut throat.

  • BeckoningChasm

    Remember, too, that no one thought either Jaws or Star Wars were going to be hits. I seem to remember reading in Ken’s review that Jaws was released in the summer because “no one went to the movies during the summer” and thus no one would care. And Lucas went to Hawaii when Star Wars opened so he wouldn’t have to hear about how badly it opened.

    The thing is, word-of-mouth helped both of those films; people saw them and they liked them and recommended them. Aside from Iron Man and perhaps the first Pirates OTC or Matrix filmes, word-of-mouth nowadays is the kiss of death. That’s why most films’ opening weekends feel like muggings–you open huge, punch moviegoers in the wallet if you’re lucky, then let word-of-mouth kill you the next week. You’ve already got your big bucks, so it doesn’t matter.

  • Hey Ken – now THAT is a good idea (specializing in Philippine horror flicks). You got it buddy. Beckoning – you made an excellent point. When “Jaws” (and “The Exorcist”, too, for that matter) first came out – I went to see them with my mom, dad and sister based solely on word of mouth. as things become more expensive and our society becomes more technology oriented – it’s possible that a site like “Rotten Tomatoes” will dictate the market more significantly. Thus rendering the consumers less susceptible to opening weekend “muggings”.

  • Danny

    “In my opinion, their best bet is to try to build up some kind of cult following in Japan.”

    That’d be pretty tricky. Japan isn’t a huge source of revenue for the movie industry. *Checks Box Office Mojo* Last weekend, the top thirty movies made $13 million and change. Combined.

    And in the last 19 weeks, either 9 or 12 weeks (I don’t know where L: Change the World was made) were topped by a Japanese movie, not an American one. Cloverfield made $2.5 million its opening weekend in Japan. If a movie makes $30 million over there, it’s considered a hit.

    The rest of the world COMBINED makes back similar amounts to what Hollywood gets from America.

  • With Japan, you could also market other items related to the movie. Japan can be obsessive. See:
    http://cgi.ebay.com.sg/JAPAN-2003-ASTRO-BOY-PROOF-SET_W0QQitemZ290225621764QQihZ019QQcategoryZ3391QQcmdZViewItem

  • fish eye no miko

    Danny sais: “And in the last 19 weeks, either 9 or 12 weeks (I don’t know where L: Change the World was made) were topped by a Japanese movie,”

    L: Change the WorLd (yes, you capitalize that “L”) is a Japanese movie.

    There’s a manga called Death Note that spawned two movies (Death Note which is actually playing in some US theaters later this month, and Death Note: The Last Name). The character of L (it’s a code name) is very popular, so after the success of the other DN movies, they decided to give him his own movie. Apparently the plan worked… ^_^

  • Terrahawk

    I can remember going to our small town theater to see Superman and Raiders of the Lost Ark. People were literally lined up into the parking lot. Interestingly, that actually increased the joy of the experience because you saw a lot of your friends in line. Maybe the efficiency of the multiplex has diminished the effectiveness of the movie going experience.

    Also, can someone explain to me the logic of charging the same price for every film that comes out? With a gazillion screens, why not show a little more price flexibility.

    L: Change the World

    Ah, now I know what you are talking about. Death Note is an interesting story. With the second season though it really gets confused and seems to violate rules it established in the first season. Overall though, it offers the possibility of a good live movie treatment.

  • fish eye no miko

    Terrahawk sais: “L: Change the World

    Ah, now I know what you are talking about. Death Note is an interesting story. With the second season though it really gets confused”

    Well, season one was 25 episodes and covered manga chapters 1-58. Season two was 13 episodes and covered chapters 59-108. Which means it was trying to cover almost as much material in nearly half the time.

    “Overall though, it offers the possibility of a good live movie treatment.”

    In case you don’t know, there’s already two live-action DN movies; L: Change the WorLd is the third. The other two sort of follow the manga, but there are a few important differences.

  • John Nowak

    From reading the manga, I think Death Note was a victim of its own successs — I’ll bet it was meant to be shorter, but it was popular so it was extended. This is a very nasty problem for this particular story because it’s about a magical item that works in a known way, and the “rules” start evolving to make the plot work. About the first half is amazingly tight and well plotted; then it starts to have problems. Anyway.

    Whenever questions of budget come up, I think it’s very important to remember that the best and most creative storytellers in Hollywood are the accountants. The “Film budget” figures you see are not designed to say “this is how much the film cost”, they are designed to reap the maximum possible benefit from tax laws.

    I’m going to make up figures here, but let me explain. It’s very simple to make the apparent cost of something skyrocket. Let’s say the director of a film being made for Ajax Studio wants a salad. The salad’s ingredients cost maybe $1.50, and it would cost $5 in a restaurant. If he sent a gopher to buy it across the street, it might cost $5 for the gopher’s salary and another $5 for the salad.

    If, however, we can say “Ajax Film Production Inc. has paid Ajax Film Catering Inc. $50 for a salad” then we spread $40 across two entities and possibly get a better tax situation at the end of the year, at the cost of wildly inflating the “budget” of the film. I suspect a lot of this is going on, and that the actual cost of a film is somewhat more modest than it appears to be.

    Of course, you’d expect that increasing technology should reduce the absolute cost of making films. One weird little factoid: one of the actors guessed Plan 9 from Outer Space (1959) cost around $10-20,000, which seems reasonable. $10K in 1959 is about $85K in 2004. Lost Skeleton of Cadavara has a boxofficemojo.com budget of $40,000.

    It’s not a perfect apples-to-apples comparison by any means, but it’s amusing to note that in 2004 a director was, indeed, able to make an intentionally entertaining film for less than half of what Ed Wood spent.

  • The Wachowski bros certainly put a lot of effort into making Speed Racer… the movie overall looked and felt like a cross between anime, a kaleidoscope, that Flintstones movie, a video game and the Dukes of Hazard

  • I may be entirely wrong–it may just be that there never was an audience for this exact movie–but I still suspect the grossly exaggerated running time is what killed this movie. Movie makers are like authors (yes, Stephen King, I’ve looking at you); sometimes when they reach a certain level of success, there’s nobody to tell them “no” anymore. There’s absolutely no reason for a Speed Racer movie to go much past and hour and a half, and I think a lot of parents just weren’t ready to sit their with their kids as this thing rolled well past the two-hour mark.

  • John Nowak

    Here’s the weird thing: just hearing about the show again made me curious and I ended up buying a reprint of the original manga, and getting a “collectable” 1/18 scale Mach 5. Comes with a plastic Chim-Chim, so you know I’m money’s worth.

    I even came close to going to see Speed Racer last week; but instead I watched the “first seven minutes” clip the perpetrators have proudly posted out there.

    My God, that is one ugly film clip. I mean, it is physically difficult to watch. Then Speed has a flashback to when he was a kid and … his mother talked to his teacher without his being in the room. That seven minute sequence seemed to last half as long as Iron Man.

    Those first seven minutes absolutely destroyed any desire I had to pay ten bucks to see it on the big screen.