When studios delay films, that comes with a price tag

Kai Ryssdal and Sean McHenry Nov 19, 2021
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"['No Time to Die' is] the third highest-grossing Bond film in history. And yet, it doesn’t seem like it’s going to reach profitability," says Chris Lee of Vulture. Mladen Antonov /AFP via Getty Images

When studios delay films, that comes with a price tag

Kai Ryssdal and Sean McHenry Nov 19, 2021
Heard on:
"['No Time to Die' is] the third highest-grossing Bond film in history. And yet, it doesn’t seem like it’s going to reach profitability," says Chris Lee of Vulture. Mladen Antonov /AFP via Getty Images
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From “Dune” to “Black Widow” to “No Time to Die,” the latest in the James Bond franchise, major Hollywood film releases have been pushed back while the pandemic kept audiences away from theaters. But according to a story by Vulture movie reporter Chris Lee, those delays don’t come cheap — and some films may not be able to recoup the loss.

“Marketplace” host Kai Ryssdal spoke with Lee about the costs of film delays. The following is a transcript of their conversation.

Kai Ryssdal: I want to ask you about this line from your story: “No one is entirely sure how to measure the exact dollar amount that has been lost other than to say it’s a gargantuan, multibillion-dollar sum.” That’s quite something.

Chris Lee: Yeah, there’s a huge amount of money that’s been lost in the pandemic, and all these various delays in these films. You used to never see giant blockbusters being pulled off the release date, basically, at the 11th hour. It would almost be the equivalent of a battleship turning a 180 in the middle of the ocean. But oceans of cash have been burned trying to promote films that don’t come out for months or years; careers have been put on hold. Nobody can really put the dollar amount on what has been lost to date.

Ryssdal: Yes to all of that, but a Bond film is a Bond film is a Bond film. And James Bond is always going to get people to go to the movie theaters, no?

Lee: Yes and no. So “No Time to Die” is the 25th James Bond film. It has taken in $709.2 million worldwide. It’s the fourth-biggest movie overall to open [in the Bond franchise]. It’s the third highest-grossing Bond film in history. And yet, it doesn’t seem like it’s going to reach profitability.

Ryssdal: That’s crazy. … What’s going on here?

Lee: Well, the Bond film is unlike almost any other movie on the release calendar this year, in so far as it has so many promotional partners. When it got postponed for the first time in March of last year, by that point, they had already spent $5.6 million on a trailer that aired during the Super Bowl. Then, when they were going to release it around Thanksgiving of last year, they cranked up another $65 million into the pipeline to promote it. So they held the movie three times overall. And by some accounting, they were burning a million dollars a month in financing costs. The company that’s releasing the movie, MGM, borrowed cash to finance “No Time to Die,” which it couldn’t recoup until the movie arrived in multiplexes. And because of that delay, S&P Global eventually downgraded MGM credit rating from B+ to a B for sustained high leverage as a result of ongoing theatrical delays.

Ryssdal: OK, so if it’s tough out there for Bond in the pandemic and delays and all of that, if you’re just some sort of mid-market movie, you’re just sunk, right?

Lee: I mean, getting market share at a time where it seems like one month, people are happy to go back to the multiplex, and another month they’re totally spooked, it’s definitely harder for those smaller movies. The most successful movies of the year, “Shang-Chi and the Legend of Ten Rings,” “Venom: Let There Be Carnage,” “Black Widow” — they all were held. But now that they’re flooding back into the multiplex, that’s sort of to the exclusion of some of those smaller and mid-level movies that you’re mentioning.

Ryssdal: Play this forward for a second. Is it just going to be a Wild, Wild West out there for a number of years, until things settle a bit?

Lee: Well, I think what you’re seeing is that movies can still make an enormous amount of money. But I think studios might not be able to hold their way to a blockbuster. They can maybe hold their way to profitability — or close to profitability — but things are going to be messed up for the next who knows how long.

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