Disney, Netflix and the Looming Animation Correction
Data shows how two studios went sideways - and also how to fix them
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One of my pet peeves these days is when entertainment business coverage tries to talk about what is or isn’t working in movie theaters based on broad pronouncements. For example, answer these two questions:
Which film did more moviegoers see in theaters, Five Nights at Freddy’s or Transformers: Rise of the Beasts?
What number is higher, $137.2 million or $157.2 million?
Ideally, your two answers should correlate, right? The second set of numbers is the domestic box office results for Five Nights at Freddy’s and Transformers: Rise of the Beasts, respectively. I mean, if more customers saw Five Nights at Freddy’s, then it would have made more at the box office! That’s basic math. But based on the news coverage, I doubt few people suspect that Transformers outgrossed Freddy’s.
The difference is that Freddy’s cost a meager $20 million, and Transformers cost an estimated $200 million.
Return on investment and profitability definitely matter in studios’ calculus, but we need to be careful about our language. We can’t make sweeping conclusions about consumers and what they want as press and analysts often do (e.g. “They’re tired of comic book movies!”) if what we really mean to say is, “Blockbuster film budgets are too high.”
This bias toward assigning blame on the consumer applies to today’s subject: animated films. Everyone seems to have noticed a trend:
Pixar’s Lightyear had $118 million in domestic box office last year.
Disney Animation’s Strange World had a miserable $38 million.
Pixar’s Elemental opened soft to under $30 million last June.
And then the film that was supposed to celebrate 100 years of Disney Animation — Wish — also had a disappointing run.
For years, animation looked like a cash cow for studios. Suddenly, animation looks like it may have a problem. Have consumers abandoned animated films?
Well, not really. But that doesn’t mean a few studios don’t need to worry. Namely: Disney and Netflix.
In this issue I will…
Show graphs that prove customers still want animated films.
But also reveal the biggest struggle is launching original animated films.
Prove that Disney’s increased output backfired.
And that Netflix isn’t faring much better.
Tell you what China has to do with it.
And what to know about the overall decline in theatrical viewing.