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Hollywood ‘sequelitis’ and why pay-TV follows a different script

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Via Financial Times

Ricky Gervais didn’t mince his words when he opened the 77th Golden Globes earlier this month: “No one cares about movies any more. No one goes to the cinema . . . Everyone’s watching Netflix . . . Most films are awful. Lazy. Remakes, sequels.” Meanwhile this week Quentin Tarantino said that original film-making was in “combat” with franchise blockbusters such as Disney’s Avengers. Neither of these accusations are likely to concern Hollywood executives.

The decades-long trend of “sequelitis” is striking a chord globally. Of the top ten grossing films of 2019, all were either franchise entries, sequels, remakes or spin-offs. Avengers: Endgame, one of the year’s three instalments in the Marvel Cinematic Universe superhero franchise, scored a record-breaking $1bn opening weekend and generated worldwide box-office receipts of nearly $2.8bn. At about seven times its production budget, this makes it one of the most successful films ever.

“The reason that the studios rely so heavily on the sequel is because generally the odds are with you, if you are creating a franchise,” says Paul Dergarabedian, senior analyst at ComScore, a data analytics company. “There’s a wellspring of potential box office takings coming from every movie that’s part of that universe.”

Graphic showing the how film franchises have come to dominate the box office

The successes of these franchises — and the changing pattern of cinema attendance — have spurred the studios to focus their output.

In the 1950s, large crowds would go to the cinema on a weekly basis; today audiences are going less frequently. Greater competition for cinema goers’ leisure time, the rise of on-demand entertainment without the constraints of a static broadcasting schedule, and fewer local screens mean that viewers may not risk paying for something unfamiliar.

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“Cinema is now where you go to play safe,” says Peter Miskell, professor of international business and media history at Henley Business School. “You want to be fairly assured that you’re going to be getting content that you’re going to enjoy. Whereas you can take a bit more risk with TV and streaming services and that’s where a bit more innovation is happening.”

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More discerning consumer spending has played into Hollywood’s cautious stance on the big screen, where the success of a franchise lies in creating novelty from the familiar. Film observers have pegged the current cycle of franchise films to the start of the millennium. In 2001, the top two grossing films were the first instalments of Harry Potter and The Lord of the Rings chronicles. These were based on popular book series with large, established fan bases. Each film amassed more than $1bn in gross box office revenues.

Charts showing the box office rank of popular film franchises

For streaming services, financing niche films doesn’t present the same problems as for large Hollywood studios. It is almost welcomed by video-on-demand companies, who see it as a way to capture additional subscribers. American film director Martin Scorsese was attracted to the creative freedom offered by Netflix when making The Irishman, after struggling to secure funding.

“Streaming studios have moved to broaden their film portfolios through mid-level content just as studios have sought to starve them of the big movies,” says Richard Cooper, director of research at Ampere Analysis, a media and entertainment specialist. “For streaming companies it’s about building a library of content to fall back on.”

Graphic showing the diverse range of content on US streaming services

As a result, streaming content has risen across the board. In the US Amazon, Netflix and Hulu have increased their portfolios by about 20 per cent a year, though mostly through additional TV shows.

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While 2020 is shaping up for a dearth of movie sequel releases, 2021 will see more of them hitting the big screen — including the ninth Fast & Furious film and the 12th instalment of the Halloween horror series. There will, however, be fewer releases from 2019’s slate of blockbuster franchises.

This could spell good news for the original film-making that Mr Tarantino claims is under pressure. ComScore’s Mr Dergarabedian said: “Films such as Knives Out and 1917 are now appealing to audiences by virtue of the fact that they’ve seen so much originality on the small screen.”

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