How Universal conquered the box office - without a superhero in sight

“No capes.” That, in the words of Edna, the costume designer in Pixar’s “The Incredibles,” pretty much sums up the strategy that has catapulted the once-struggling Universal to the top of the box office charts this year and a remarkable string of nine hits out of its last 10 releases.

The studio has accomplished the feat without a single superhero franchise film, which stands on its head the conventional wisdom that action heroes in big-budget spectacles are the only predictable road to success in Hollywood these days.

Last weekend, Universal’s hard-to-categorize hip-hop saga “Straight Outta Compton” had an opening weekend box office of more than $60 million, surpassing the opening weekends for what were expected to be two of this summer’s biggest franchise hits, Disney’s latest Marvel superhero film, “Ant-Man,” and Paramount’s latest “Mission Impossible” installment.

story_article_left1

“Universal struck gold this summer,” said Doug Creutz, an analyst who covers the media for the Cowen Group. “They had the right mix of movies. Some of this was skill. Some of it was luck. Some of it is just the randomness of the movie business. I don’t think even the people at Universal can really explain it.”

Jeff Shell, chairman of Universal’s Filmed Entertainment Group, said he didn’t believe that he and his colleagues had somehow unlocked the secret to the movie business.

“It’s a tough cyclical business,” he said. “All we can do is try to increase the chances of success.”

Universal’s string of hits this year has included big-budget action spectacles like “Jurassic World” (already the third-highest grossing film of all time) and “Furious 7” (which set records in China), the animated “Minions” and lower-budget female-oriented films like “Pitch Perfect 2” and “Trainwreck.” (“Furious” and “Minions” were originally scheduled for last year, but delays pushed their revenue into 2015.)

The R-rated comedy sequel “Ted 2” has been Universal’s only misfire among its last 10 films, and even that has grossed $174 million worldwide. Universal leads this year’s box office sweepstakes with more than $2 billion in revenue, a remarkable 28 percent market share.

block_quotes_start With “Fantastic Four” bombing at the box office, there are increasing signs of possible boredom with superheroes. block_quotes_end

Universal’s (and Disney’s) movie studios have been a bright spot for their parent companies, even as media company stocks have been battered this summer over investor worries about slowing cable revenue. Despite the strong results from their studio operations, Comcast shares have dropped more than 10 percent since late July and Disney shares are down more than 16 percent.

story_article_right2

While Universal has a comfortable lead over second-place Disney, it’s too soon to know the outcome for the year, because Disney has a “Star Wars” installment coming in December, its first “Star Wars” film since it bought Lucasfilm in 2012. Disney is the embodiment of the current big budget, event-film strategy that Wall Street likes for its perceived predictable revenue stream. Under its chief executive, Bob Iger, Disney spent $7.4 billion for Pixar, $4 billion for Marvel and $4 billion for Lucasfilm - all big bets that seem to be paying off.

But Universal has taken a radically different approach, in part through necessity. Disney already owns Marvel, and Warner owns DC Comics, which means there aren’t many superhero franchises left. And Universal’s tight-fisted parent, cable and broadband giant Comcast, is loath to spend billions buying other people’s franchises.

“We’re in the business of making money for shareholders,” said Shell, a Comcast executive installed as head of Universal about two years ago. “We’re focused on the bottom line. We’re proud of the small movies that generate significant profitability. And sometimes small movies become big movies.”

Donna Langley, chairwoman of Universal Pictures and a 15-year veteran at Universal, added, “Having the right ownership and a strong management team,” which includes Ron Meyer, vice chairman of NBCUniversal, “has enabled us to step back, do what we do well and focus on what we need to improve on. We’re not trying to emulate what other studios are doing.”

Universal has spent relatively modest amounts to help build Illumination Entertainment, an animation studio co-owned by Universal and Chris Meledandri, chief executive of Illumination, who has already created a lucrative franchise with “Despicable Me” and this summer’s hit prequel, “Minions.” Universal’s biggest franchise, the “Fast and the Furious” action series, with its bankable star, Vin Diesel, was developed internally, with the original opening in 2001.

full_story_image_hleft1

Even “Jurassic World” was hardly a sure hit. Universal and Steven Spielberg acquired the rights to Michael Crichton’s best-selling dinosaur epic “Jurassic Park” even before the book was published in 1990, for a modest $2 million. It had been 12 years since the last installment, as Spielberg rejected scripts he deemed inadequate.

Even with Spielberg’s blessing, the latest version got mixed reviews and some out-and-out pans from critics. But thanks in part to a huge and well-executed digital marketing campaign, it became the must-see movie of the summer, eclipsing even the Disney/Marvel blockbuster “Avengers” sequel.

story_article_left3

“There was a social media aspect to it that kind of created a network effect,” Creutz said of “Jurassic World.” “Everyone was talking about it so everyone had to see it. The marketing was very effective. But beyond that I can’t really explain it. 'Mad Max: Fury Road’ was four times as good a movie, but it didn’t do nearly as well.”

While “Jurassic World” and “Furious” could be considered classic big budget “tent pole” movies, the kind of films that can prop up an entire slate, they were the only two in Universal’s summer lineup. The studio has also targeted the kind of smaller-budget comedies, dramas and musicals that, while hardly independent art-house fare, have rekindled hopes in Hollywood that something other than action blockbusters can still be made successfully.

“Compton,” the studio’s latest big hit, a musical biopic of the hip-hop group N.W.A, is hardly mainstream blockbuster fare. But it opened to glowing reviews during a national conversation about race and police tactics aimed at young black men like the early hip-hop stars portrayed in the movie. It, too, has generated buzz on social media far beyond the urban black communities like the one in which it’s set. Universal said the film was well on its way to $150 million in domestic box office sales and cost just $29 million to make.

A low-budget musical about a women’s a cappella singing group with an ensemble cast lacking major stars would hardly seem like a big grossing film, let alone franchise material, but the success of “Pitch Perfect 2” suggests that Universal may have generated another franchise hit.

Langley said the studio had noticed that the original “Pitch Perfect” had a strong afterlife. The song was a hit. It did well on home video. We knew it was tapping into something.” It could easily have been marketed as a small, offseason movie, but “we gave it an early summer date and treated it like a big summer film,” she said. It has grossed $184 million in domestic sales and cost just $29 million.

full_story_image_hleft2

Some supposedly “safe” blockbuster films from other studios were flops, like Paramount’s latest “Terminator” installment and Warner’s “The Man from U.N.C.L.E.” And with Fox’s “Fantastic Four” bombing at the box office this month, there are increasing signs of possible boredom with superheroes.

Whether Universal’s success this season with more offbeat fare encourages other studios to take more creative risks remains unclear.

“What’s coming are a lot of superhero, franchise and would-be franchise movies,” Creutz said. “Everybody is imitating Disney, though maybe not quite as extreme.”

He said that Universal’s lack of superhero fare might actually help it, because there are going to be so many superhero movies battling for market share.

“I’m really concerned,” Creutz said. “The number of these big-budget action and animation films is increasing, and the number that can succeed is decreasing. Those lines aren’t going to cross in a good place for many studios.”

--2015 New York Times News Service