The Summer Box Office Will Cause a Paradigm Shift
A paradigm shift is defined as a major change in thinking or approach, and after the results of the 2017 summer box office, I believe the entire film industry will undergo such a shift. In total, the summer box office has fallen from $4.45 billion in 2016 to roughly $3.8 billion this year, an even larger drop than was expected. Films which were once thought to be guaranteed successes, such as Transformers: The Last Knight, and safe bets such as Baywatch, flopped or disappointed. Many tentpole films collapsed, and comic-book films were the only blockbuster genre that saw repeated success. However, as much as I love superheroes, overreliance on that single genre may harm the industry in the long run. The wave of digital outlets such as Netflix and Amazon, along with blockbuster sized television programs like Game of Thrones on HBO, have changed audience standards and expectations of what they should expect in cinemas. But the film industry hasn’t adapted, and this summer proves that. Hollywood’s metaphorical iceberg is still many miles off, but very troubling signs are beginning to emerge, and the film industry should act now if it wants to avoid further loses.
Back in May, I wrote that many analysts expected the summer box office to drop $450 million, to a total of $4 billion domestically. Now that the final numbers are in, we know that the box office dropped even further, to $3.8 billion dollars. Weekend after weekend, films which typically would have done well disappointed, and there is no better example of this than Transformers: The Last Knight. Back in 2007, the first Transformers film grossed $319 million domestically, the second made $402 million in 2009, the third grossed $352 million in 2011, and the fourth made $245 million in 2014. All of these films were poorly received by critics, but it was The Last Knight, the fifth in the franchise, which grossed $130 million in the U.S. this year, far lower than any of its predecessors and an embarrassing figure for any film with a budget of $217 million.
For studios to recoup their investment on a film (excluding advertising), the film must gross twice what it cost to produce because theater chains take half of a film’s box office haul. This makes blockbusters a somewhat risky investment, because if one flops it could cost the studio hundreds of millions of dollars. However, for the past few decades, flashy films with large budgets have typically made their money back regardless of critical reception. Even in 2014, Transformers: Age of Extinction was able to climb to $1.1 billion worldwide in spite of an 18% on Rotten Tomatoes.
This year, the fifth Transformers garnered a similar score (15%) but grossed about half of what its predecessor made in the U.S. just three years ago. It is debatable whether Rotten Tomatoes and/or general word of mouth are heavily responsible for the results of the domestic box office. But it appears that a film’s critical reception now has a great impact on its box office success, and that has always not been the case in the past few years.
Baywatch, King Arthur: Legend of the Sword, and The Dark Tower are examples of films which were poorly reviewed and flopped at the box office despite their heavy mix of special effects and/or star power.
At the same time, the U.S.’s highest grossing film of the summer earned a 92% on Rotten Tomatoes, second and third place earned 82% and 92% respectively. On the surface, this seems good: many poorly reviewed films flopped, and the well-reviewed films succeeded. And this isn’t a trend that started this year, the domestic box office has been heading this way for a while now. However, a problem emerges when one realizes that those films, Wonder Woman, Guardians of the Galaxy Vol. 2, and Spider-Man: Homecoming were all superhero movies.
Only one film this summer (Despicable Me 3) came close to the box office hauls of those three, and this is a problem for one very big reason. No other blockbuster genre is consistently performing well, which will prompt more studios to invest in comic-book films. Eventually, audiences will grow tired of superhero movies (as they do with nearly every genre) and the superhero craze will fade. This isn’t to say that comic-book films will be gone forever, but it is likely that we a currently living through their peak in popularity. When this genre fades, what will be left to replace it?
It is possible that in the next few years, as the comic-book film genre loses its popularity the film industry will have nothing to fill the void it leaves behind. I do not believe this will happen, but it is seeming increasingly likely.
In order to avoid such a bleak future, there is one very simple thing Hollywood can do: make better movies.
For years, there has not been a strong correlation between a film’s reception and its gross, so studios did not feel pressure to churn out great movies. Even this summer, films with extremely positive critical reception such as War for the Planet of the Apes underwhelmed at the box office, but now more than ever it seems that high-quality pictures have a better shot at making money.
Take Baby Driver for instance. Director Edgar Wright has a long history of creating films which garner great reviews but disappoint financially, Scott Pilgrim vs. the World being a popular example. However, this year Wright’s Baby Driver grossed $103 million dollars (with a budget of $34 million) at the domestic box office, three times more than his next successful film.
That is only $27 million less than Transformers: The Last Knight, and had you told a box office analyst, even back in April, that an Edgar Wright film and Transformers film would gross such similar figures, they might have laughed. Now that it has happened, I would argue it bodes very well for the future of the film industry, or at least it could.
It may not have been apparent until now, but I think it is becoming increasingly clear that Amazon, Netflix, and YouTube (and other outlets like them) are having a greater effect on audience expectations than most realized. Now that there is a nearly unlimited amount of video content ready to be viewed from home, driving to the theater and paying $10 per person (excluding food) is a much harder sell than it used to be even a few years ago.
Netflix in particular, has also done an amazing job a generating content capable dominating the internet as much as any feature-length film. Daredevil (a Netflix original) now famously won over the Marvel fanbase and arguably caused the reception to Avengers: Age of Ultron (which came out a few weeks later) to skew somewhat negatively. Last summer, Netflix’s Luke Cage and Stranger Things managed to earn immense popularity, and this summer The Defenders garnered plenty of attention.
Television in general has been in a golden era for the past few years, and blockbuster sized shows like Game of Thrones have seriously taken away attention from film.
With so much amazing content easily viewable from a sofa, it is easy to see why audiences are declining to view poorly received films such as The Dark Tower.
This summer will cause a paradigm shift, as many tried and true strategies failed to succeed in an increasingly competitive entertainment industry. Disaster is not yet on Hollywood’s doorstep, but if the industry wants to avoid that possibility, it needs to generate better films and pay more attention to the scripts it produces.
The discussion about scripts deserves its own post, but for the moment, the film industry’s solution to this problem is very simple: make films audiences want to see. Those films used to be flashy blockbusters, now they’re well-made pictures, and Hollywood has to adapt.