THB #52: Slow Start To 2022 & Perhaps, A Road To Stability

Yesterday, as I was looking at December, Disney was pulling another Fox movie off the schedule for early 2022. I was already aware that Warner Bros. was, even as it was recommitting to theatrical, not really in the game until March.

So I took a look at the first 4 months of 2022, before the summer launches with Dr. Strange in The Multiverse of Madness. And it’s not too pretty.

In January thru March - 13 weekends - I count 16 wide release movies… compared to 30 wide releases in the first 3 months of 2019.

In 2019, there were 7 $100m domestic grossers in those 3 months. In 2022, I see only 8 that really have aspirations to a $100m domestic gross, with some sure to miss that mark.

At the very top of the Q1 charts, past and forward-looking, it could be close to a draw, with The Batman and Morbius having the potential to come close (certainly within the 20% currently seeming like the COVID hangover margin) to the 1-2 punch of 2019’s Captain Marvel and Us ($601m combined domestic).

It’s finding the other 5 $100 million domestic grossers that is challenging. Scream, Moonfall, Jackass Forever, Marry Me, Downton Abbey, and Lost City of D are the horses in that gate. But I am not confident about any of them cracking the $100m ceiling. There could be a surprise smash, like The Black Phone or Turning Red or Ambulance, but I’m not overly hopeful.

There were 5 $50m-$86m domestic grossers in those first 3 months of 2019… and I suspect that most of the 2022 titles mentioned in the last paragraph will land there… which is something… but not really a recovery.

I keep making the point, waiting for it to be so obvious that others need to jump aboard the notion, but there just isn’t enough content in the marketplace to support the overall market so it’s not all reliant on big openings. And the holds are being damaged by the audience perception that they don’t have to wait long to see movies that are coin flip choices for them.

Universal leads the quarter with 4 releases (plus 1 from Focus), with Paramount showing signs of life with 3 titles, all of which could do nicely (the sell on Lost City of D needs to get going), and Sony, Disney, and Lionsgate releasing 2 each.

I don’t think it’s a coincidence that Universal is the closest to a “normal” release schedule, as they were the first ones to fully act on plans to manage their reconfigured release window.

In more news for yesterday, Universal announced officially that it would push every movie to Peacock 45 days after the theatrical launch, joining Warners and Paramount. It is not as clear whether this fits into the plan announced last July, to put studio films on Peacock for 4 months, then elsewhere for 10 months, then back on Peacock for 4 more months, mirroring what was a traditional Pay-One window.

Regardless, this is a double-edged sword. It is helpful for the industry to have consistency. Whatever effect one believes a smaller support system for theatrical will have overall, it is easier to know what is coming and not having to guess with each studio and each film.

Is Universal doing anyone a favor by pushing theatrical releases that don’t do big numbers to digital access PVOD in just 17 days, inside of that potentially 45-day theatrical window? I don’t think so. But this is where their math is right now.

Here is the real problem… the 45-day window as the industry standard for a mostly-exclusive theatrical window has some merit. But for it to allow for exhibition to remain healthy, they need to start pushing more content into theaters, not less.

Content distributors really need to push about 100 real wide-release titles into theaters every year - about 2 a week - to balance out the damage created by the shortened windows. About 25 of those need to have legitimate ambitions to gross $100 million-plus domestically.

For what it’s worth, the month of April has 8 wide releases on the schedule, including Sonic 2, Fantastic Beasts 3, and a bunch of titles that could be happy surprises. It won’t be the biggest April, but it will feel closer to “normal” than the first 3 months of the year.

May has 2 big hitters and 3 strong hopefuls. June mirrors this. And July has fewer titles, but 3 are potential megas (Minions, Thor, Black Adam). August is a hot mess right now, but that could well change in the next couple months. Still not enough movies in the marketplace… but closer this summer than we have been in any month but October 2021.

If exhibition takes a 20% haircut on average for every film, increased amounts of content will balance things out. Which means committing to this idea of how to use “movie” material in the structure that a majority of distributors seem to be heading towards. This also means, comedies and dramas come back to the movie theaters. It also means that the streaming outlets of these 2-way distributors can spend less on original television-first content with at least 2 “major” movies coming to each streamer each month.

This is beginning to look like a model that won’t make everyone happy… but won’t put many out of business.

This is, as it has always been, a high-risk business. While you avoid negative surprises by limiting how you release movies, you also avoid hugely positive surprises. It ain’t brain surgery.

The answer to the future of all of this is going to be, for most companies, a balance that is very different than the legacy past, but also, shockingly similar to the legacy past in concept. Television will be more muscular than ever, expanding these companies across the globe directly, with movies adding a piece (maybe 10%). Ad-based programming and subscription ad-free programming. Multiple options for how to access content, available to access on all internet-connected platforms.

It can’t be the chicken or the egg. It has to be the chicken AND the egg.

Until tomorrow…