Hollywood studios could be in for another year of “big-budget bombs” and increased volatility around mid-budget releases, film industry analyst Doug Creutz warned in a report this week.
As he has been warning for years, the Cowen and Co. media analyst said that film studios’ increasing reliance on tentpoles and superhero movies will contribute to a decline in per-picture box office grosses in 2017, making what once seemed like sure-fire bets on big-budget flicks a decidedly riskier enterprise.
According to Deadline, Creutz says the film industry in 2017 will be “at least as difficult” as it was in 2016, when operating profits at the major studios fell 14.6 percent, even as total box office receipts inched up 2.2 percent over 2015 numbers.
That increase was due largely to inflation and the increasing cost of movie tickets, the analyst warned. And Disney — with its stable of established franchise properties like Star Wars and Marvel films — reportedly captured the lion’s share of the haul with a staggering 60.5 percent of the industry’s $4.18 billion in total operating profits.
Creutz noted that nearly three-dozen upcoming releases from major studios this year boast budgets north of $100 million, and predicted Fox and Paramount could struggle the most with offerings like War for the Planet of the Apes and Transformers: The Last Knight, respectively. He added that Disney would likely continue its dominance with a new Star Wars film and the Guardians of the Galaxy sequel, while Warner Bros. could see success with Wonder Woman, Justice League and Christopher Nolan’s World War II epic Dunkirk.
The Cowen and Co. analyst has expressed skepticism for years about the major studios’ shift toward pursuing similar release strategies, or what he described as putting “more and more eggs in the franchise picture basket.”
“History suggests — and we have ample evidence of this in the animation genre — that as the number of films in a given genre increases, the average per-film performance decreases, and that even the top-tier films in a genre are not immune to the phenomenon,” Creutz wrote in a 2015 report, according to the Hollywood Reporter.
After a brutal Summer 2016 that saw numerous big-budget bombs like Alice Through the Looking Glass, Ghostbusters, Ben-Hur and The BFG, Creutz warned that the film industry is in “real trouble.” Making matters worse, receipts from the top-grossing 100 films at the international box office last year reportedly dipped 1.7 percent as European territories have become inundated with a glut of blockbuster films.
Creutz suggested last year to the New York Post that studios should focus on diversifying their release slates, or else just shut down altogether.
“Where did all the romantic comedies go?” he asked.
Follow Daniel Nussbaum on Twitter: @dznussbaum