It may seem difficult to believe, but a little more than 15 years ago, Hollywood’s current movie king, Walt Disney Studios, was at something of a crossroads.
The '90s had marked a new golden era of animation, one that included the release of Oscar-winning classics such as Beauty and the Beast (1991) and The Lion King (1994) and the launch of a lucrative partnership with Steve Jobs’s Pixar Animation Studios. The decade was also a good one for the company’s live-action division, yielding Jerry Bruckheimer blockbusters such as The Rock (1996) and Armageddon (1998). But after all that, Walt Disney Studios ended the 20th century and kicked off the 21st with a whimper.
The legendary "Mouse House" (a moniker affectionately bestowed upon it by industry trade paper Variety) didn’t release one film in 2000 that cracked the top 10 in terms of the year-end box office. In fact, Disney’s highest-grossing film that year landed at number 11; it was Dinosaur, a now-forgotten CG animated tale that was considered a severe financial disappointment. To say times have changed since then is something of an understatement.
As of July 19, Walt Disney Studios is dominating the box office in 2016, with four of the top five highest-grossing pictures to its name. Together, Finding Dory, Captain America: Civil War, Zootopia, and The Jungle Book have earned more than $1.455 billion in ticket sales in the US alone. It’s been a bumpy journey, but under CEO Bob Iger, the family-friendly conglomerate has spent the past 10 years making strategic moves that have transformed it into the envy of every entertainment company in town.
For some perspective on where Walt Disney Studios is today, consider this: After signing Steven Spielberg’s DreamWorks Studios to a highly touted and strategic distribution deal in 2009, the publicly traded company just let DreamWorks walk out the door. Spielberg, arguably the greatest populist filmmaker living today, delivered three straight Oscar-nominated pictures to Disney under the DreamWorks banner: War Horse (2011), Lincoln, (2012), and Bridge of Spies (2015). Academy Award nods are great, but Disney still wished Spielberg and his creative showcase well in their recently announced new partnership with Universal Studios and Participant Media.
Why, you might ask? Disney simply no longer needed DreamWorks around.1 That’s the benefit of having a virtual creative factory powered by four of the most successful "brands" in the business: Lucasfilm, Pixar, Marvel Studios, and a revitalized Walt Disney Animation Studios.
Ironically, Spielberg just dipped back into family films for Disney with his first entry since his 2011 Peter Jackson collaboration The Adventures of Tintin, the currently-in-theaters The BFG; the Roald Dahl adaptation is now on pace to be the director’s first bomb in a decade (and only the fourth such flop of his career), not to mention a rare recent misfire for Disney’s marketing group).
A rough start to a new century for the Mouse House
As we alluded to earlier, Disney’s recent past wasn’t always this rosy. For the first few years of the 21st century, the company was dependent on Pixar’s hits to help it maintain its market share (the more hits you deliver, the better financial terms you can demand from theater owners).
Yes, there were occasional successes. The adult-targeting Touchstone division delivered a handful of blockbusters, including Signs (2002), Sweet Home Alabama (2002), and the National Treasure franchise (which debuted in 2004). Meanwhile, the studio’s Disney-branded flicks showed some hints of life, particularly minor sports-themed pictures such as Miracle (2004) and Invincible (2006) and women-driven fare such as The Princess Diaries (2001) and Freaky Friday (2003). But the costly failures outweighed those surprise hits.
Disappointments like Big Trouble (2002), The Alamo (2004), Around the World in 80 Days (2004), and Annapolis (2006) were bad films that audiences weren’t interested in, and no amount of inventive financial accounting could justify their existence. Moreover, Disney’s animation division fell into an incredible slump in the wake of producing out-of-touch duds like Treasure Planet (2002) and Home on the Range (2004), among others.
And that doesn’t even count the drama the independently run Miramax (acquired by Disney in 1993, at the beginning of the indie boom) and its founders the Weinsteins had thrown the company’s way via a dispute over the 2004 release of Michael Moore’s Fahrenheit 9/11. That fight led to a painful divorce that barely worked out for either party in the long run.
Of course, at the time this game of big hits and just-as-big misses was playing out all over Hollywood. The once-lucrative DVD and home entertainment market — the studios’ golden ticket to profitability — was beginning to shrink and would effectively collapse by 2010, due to the advent of digital piracy, video on demand, and online streaming. The industry began to shift toward a "blockbuster or bust" approach, and midrange films with smaller potential profit margins were reduced to fewer and further between.
Franchises became a necessity, and, like a high-stakes poker table, whoever had the most chips would be king. Yet even with Disney's long history of influence in global entertainment culture, few expected the studio to figure out how to take the crown without building a pipeline of R-rated thrillers and comedies.
Putting the band together: Mickey meets Nemo meets Iron Man meets R2D2
Disney laid the groundwork for its current success in 2006, when it acquired Pixar after then-new Disney CEO Bob Iger found a way to heal a contentious relationship between the two companies. That move led to the hiring of Toy Story director John Lasseter as the chief creative officer of both Pixar and the newly christened Walt Disney Animation Studios.
Within three years (a short window in the world of animated feature films), Lasseter had delivered the surprise hit Tangled (2010), and Disney’s animation offerings soon returned to peak form with one blockbuster after another, including a little trifle you may have heard of called Frozen (2013).
Less than two years after the Pixar acquisition, however, then-independent player Marvel Studios released Iron Man (2008) through a distribution arrangement with Paramount Pictures. Despite a healthy level of fanboy excitement, no one understood just how big a game changer it was at the time. Director Jon Favreau’s astonishing hit signaled the beginning of a franchise universe that wouldn’t just dominate at the box office but would put its characters on kids' backpacks across the globe.
Fifteen months after Iron Man’s release, in August, 2009, Iger swooped in and acquired the entirety of Marvel — comic books and all — for $4 billion. Back then, many questioned the deal, but in the period since the merger was completed, Marvel Studios films have earned a jaw-dropping $9 billion in worldwide theatrical receipts alone.
Disney’s willingness to let Marvel enjoy relative creative freedom while working its characters into the overall "Disney machine" of theme parks, TV networks, and, of course, merchandising paved the way for the company’s acquisition of its newest crown jewel, Lucasfilm. A casual conversation between George Lucas and Iger in May 2011 eventually led to Disney buying the iconic filmmaker’s company later that year, for a sum of $4.06 billion.
Prior to selling, Lucas had been reticent to let anyone else take the reins of his franchises. His subsequent departure from the company opened the door to new Star Wars and Indiana Jones films, and with an assist from J.J. Abrams, Star Wars: Episode VII – The Force Awakens became the highest-grossing film of all time in the United States this past winter, earning an unfathomable $936 million stateside and $2 billion worldwide (Avatar was the previous record holder, taking in $760 million in the US in 2009 and 2010. It still holds the global record of $2.7 billion.)
Oh, and have we mentioned the transformation that Disney’s live-action division underwent during that same time span? While the road was slightly rockier than the studio would like to admit, the division’s strategy of focusing on new versions of classic Disney animated tales led to such hits — at least in terms of finances — as Alice in Wonderland (2010), Maleficent (2014), and, most recently, The Jungle Book.
If you’re wondering why the other Hollywood studios are scratching their heads on how to create more franchise and must-see tentpole films, you only need to look to the industry-wide release schedule. Disney dominates almost all of the key dates through 2020, such as the annual summer movie season kickoff (traditionally the first weekend in May) and the first full weekend in December before the Christmas holiday (a date Peter Jackson’s Lord of the Rings and The Hobbit trilogies claimed for years). These days, every other studio is trying to avoid slotting their potential moneymakers anywhere nearby, for fear of being lost in the shadow of Disney’s certain blockbusters.
Today, playing second fiddle to Disney is status quo
How tough is it for the rest of Tinseltown to compete? Simply put, there isn’t much room for error these days.
Paramount, already in a tough position as a battle wages for control of its parent company Viacom, simply doesn’t have enough assets to play the game. The never-ending Transformers series defines the studio at the moment, with at least three more films on the way (and that’s not even counting a possible Bumblebee solo flick).
As long as Tom Cruise is willing, there will be the steady but second-tier-performing Mission: Impossible franchise, but the studio still hasn’t found a way to develop more stories in the Star Trek universe that don’t involve the Enterprise. (CBS, which controls the television rights and is launching a new series in January, certainly has.)
Paramount can still count on an occasional Nickelodeon success like The Spongebob Movie: Sponge Out of Water (2015), but movie studios can’t survive if they are waiting 15 years between animated sequels (a third Spongebob film is scheduled for 2019, but you should believe it when you see it). It’s even more difficult to imagine upcoming releases such as Baywatch, another Vin Diesel XXX thriller no one asked for, or a World War Z sequel moving the needle.
In slightly better shape than its crosstown rival is 20th Century Fox. Ridley Scott breathed new life into the Alien franchise with Prometheus (2012) and is setting the stage for something bigger with Alien: Covenant in 2017. Fox’s animation arm, Blue Sky, is a consistent player of profitable cartoon flicks with the Ice Age series, but the studio’s live-action franchises such as Kingsman and the Planet of the Apes series are minor players, comparatively.
What Fox does have is February’s Deadpool, a breakout shocker that became the ninth-highest-grossing superhero film of all time, thereby proving there is still massive potential in the Marvel mutant titles the studio controls.
And, of course, lurking in the distance are James Cameron’s long-awaited Avatar sequels. It’s already been seven years since the original groundbreaking 3D film hit theaters, and many are wondering if the new films will still resonate with audiences. History warns us not to underestimate Cameron, however, and the blue-skinned Na'vi are still Fox’s best chance to take the spotlight back from Disney.
The outlook is much darker at Sony Pictures, which is still trying to regain its footing after the infamous email hack in 2014. Paul Feig’s new Ghostbusters reboot can overcame misogynistic backlash and relaunched the long-dormant franchise with an impressive $46 million opening weekend, but Sony’s other upcoming tentpoles seem slightly sketchy. They include two Bad Boy sequels, a Jumanji reboot, a gutsy play with Stephen King’s The Dark Tower, a live-action Barbie movie, and an animated Smurfs flick.
Sony is so desperate for franchise success that it’s even playing the "if you can’t beat 'em, join 'em" game, having given up significant rights to Spider-Man by partnering with Marvel Studios to bring the character into the Marvel Cinematic Universe. (The webslinger made his MCU debut in May’s Captain America: Civil War and has his own starring vehicle due out in 2017.) And, it’s worth noting that Fox is allegedly willing to consider the same deal for the Fantastic Four or some pockets of the X-Men properties. That’s how powerful the Marvel brand has become.
Is Universal Studios a one-year wonder or real competition?
In 2015, after 10 straight years where it never ranked higher than third among its competitors, Universal Pictures shocked the industry by pulling the rug out from under Disney to take the domestic box office crown, earning a jaw-dropping $2.44 billion. (Warner Bros. held the previous record of $2.1 billion in 2009.)
Jurassic World was a bigger hit than anyone ever dreamed of, while Minions, Furious 7, Pitch Perfect 2, Straight Outta Compton, and Fifty Shades of Grey all exceeded expectations. Most importantly, aside from Straight Outta Compton, all those films belong to popular franchises that already have new installments on the way (although let’s put an asterisk next to Fifty Shades, as many question whether the forthcoming Fifty Shades Darker will have the same impact).
Consequently, the first half of 2016 has been a completely different story for Universal, with Neighbors 2 and Huntsman: Winter’s War making the studio the poster child for sequels audiences didn’t ask for. The studio does have a new Jason Bourne film coming out at the end of July, it’s attempting to restart its Mummy franchise, and its Illumination Entertainment division has become a powerhouse of billion-dollar animated hits (The Secret Life of Pets, which opened July 8, earned more than Finding Dory in is first weekend).
But outside of the Jurassic Park films, most of those live-action franchises are dying down. The company’s big hope is that with its aforementioned acquisition of DreamWorks, it can challenge Disney on the family front by bringing back old favorites such as Shrek and Donkey.
One challenger stands alone
If anyone can challenge Disney’s dominance, it’s Warner Bros. The former king of the Hollywood hills has a new franchise blossoming in the Harry Potter universe with Fantastic Beasts and Where to Find Them, as well as a burgeoning series of Lego Movie flicks that the studio hopes will finally propel a reliable animated pipeline.
And like Disney and Fox, Warner Bros. is counting on its superheroes to set the standard. How important is this plan to the studio’s long-term stability? Well, Warner Bros. was so concerned over moviegoers’ disappointment with Batman v Superman: Dawn of Justice that it hosted a quick set visit to the already-in-production sequel, Justice League, for some of the more outspoken critics of the Zack Snyder opus and let them publish their findings immediately (usually these reports would be held until just a few months before release).
It may seem like a minor footnote in the grand scheme of things, but it’s practically unheard of for Warner Bros. There is simply too much at stake with the studio’s DC Comics titles for it not to take an aggressive stance with the press and fans.
DC currently has solo films for Wonder Woman, the Flash, Cyborg, Aquaman, and the Ben Affleck version of Batman either in post-production or close to being greenlit. It’s one reason all eyes are on August’s Suicide Squad to right the ship. If that title becomes the blockbuster many expect it to be, Warner Bros. can spin off even more potential franchises around Harley Quinn, played by the industry’s new "it" girl Margot Robbie, and Deadshot with the still potently popular Will Smith.
Change is on the horizon, but Disney’s throne is safe for now
In today’s conglomerate-heavy Hollywood, rumors of studio and network consolidation are seemingly always making headlines. Universal’s aforementioned acquisition of DreamWorks and the DreamWorks/Participant Media/Universal pact, as well as Lionsgate’s purchase of Starz in June, are all signs of more deals to come. That would mean new players that could potentially challenge Disney’s stronghold on the box office and entertainment zeitgeist.
Additionally, it’s worth noting that there are a few proven power franchises that could find new homes. One in particular is the venerable 007 series. Controlled by MGM studios, which now distributes its own films, the series may end up remaining at Sony Pictures — where it has lived since 2006’s Casino Royale — but if Warner Bros., Fox, or Universal ends up with the next few James Bond films, it'll amount capturing a competitor’s queen on a virtual industry chessboard.
Lionsgate has also teased that it might consider revisiting the Twilight universe, and if Fantastic Beasts is successful, a spinoff for the Lion’s own Harry Potter, The Hunger Games, seems just as inevitable. So the question becomes: Are any of these movies likely slow down Disney’s potential era of dominance?
The answer is a resounding no.
Even going beyond the never-ending line of upcoming Marvel and Star Wars flicks, Frozen 2, and the just-announced Wreck-It Ralph sequel, Disney shows no signs of slowing down. The company’s upcoming slate promises powerhouse after powerhouse, with Beauty and the Beast, Toy Story 4, The Incredibles 2, Mary Poppins Returns, and a new Indiana Jones all on the way.
The studio is so primed for future success that when historians look back at the 2010s, you can almost guarantee they will christen it the Decade of Disney. Whether that will be considered a positive or a negative for Hollywood and moviegoers remains to be seen.