Top Gun: Maverick illustrates the role of cinemas in the post-pandemic media and entertainment landscape. It’s the kind of big-budget blockbuster that can generate hype, become a cultural event, and draw crowds to the giant screens of cinemas. But the new top gun does not mark the return of the cinema business model for all future films.
Covid-19 didn’t kill cinema. The business will continue – it will just be a smaller one, with big-budget event films making up the lion’s share of the box office. For almost everything else there is streaming – either right at the beginning or after an abbreviated theatrical run.
but Top Gun: Maverick is a clear exception. The long-awaited sequel from 1986 top gun was released over Memorial Day weekend and grossed $156 million in the United States and an additional $126 million abroad, according to Box Office Mojo. That’s a box office record for the holiday weekend. It’s also the best opening weekend in the career of 59-year-old Tom Cruise.
(Ticker: PARA) postponed Top Gun: Maverickwas released several times during the pandemic as cinemas were closed. Unlike many other major films released during the pandemic era, Paramount resisted the urge to release the film on its own streaming platform called Paramount+. Instead of this, Top Gun: Maverick is the first big summer blockbuster of 2022, with Jurassic World Dominion, light yearand Thor: Love and Thunder among other big upcoming films over the next few months.
Paramount reportedly spent as much as $170 million to make it Top Gun: Maverick, plus tens of millions of dollars more for marketing and promotion of the film. Management made the calculus that a theatrical release would be a safer bet to recoup those costs. That bet seemed to be paying off. The film will eventually make its way to Paramount+, but don’t hold your breath.
“There are certain films that are really made for the theatrical experience,” Paramount CFO Naveen Chopra said at an investor conference May 19. “top gun is a great example of this. You should see this film in a cinema and it will stay in cinemas for a long time.”
The traditional exclusive cinema window was 120 days, cinema chains included
AMC Entertainment Holdings
(CNK) – and some Hollywood star directors and actors – have fought hard with studios to keep it that way. But the pandemic put an end to that arrangement.
The vast majority of ticket sales for most films occur in theaters in their first six weeks, with studios then looking to shift them to other distribution channels to better monetize the content. In-house streaming services are an easy solution.
“Most films at the box office don’t generate that much revenue after 45 days,” Chopra said in mid-May. “That way we can then move that content to a streaming platform while it’s still fresh and new and capitalize on any marketing investments that have been made into theatrical release.”
That’s what Paramount has done with its other 2022 films that debuted in theaters, including Sonic the Hedgehog 2, The Lost City, Screamand donkey Forever. Everyone is now streaming on Paramount+.
But it’s a contrast to rivals and even Paramount’s own strategy early in the pandemic, when the studio was sending movies like Come 2 America, The Morning Warand The Trial of Chicago 7 directly to its streaming services or licenses them to competitors.
Warner Bros. Discovery
(WBD) debuted big-budget films, including dune, Wonder Woman 1984, The Matrix: Resurrectionand Godzilla vs Kong in theaters and on its streaming service HBO Max simultaneously.
(DIS) released some films exclusively in theaters with 45-day windows (including eternal, EncantoandShang Chi and the Legend of the Ten Rings), some debuted below Soul and Luke on Disney+ and experimented with $30 paid streaming releases for mulan, Black widowand other.
(NFLX) continued its pure streaming strategy and dispensed with cinemas altogether.
The cinema model will evolve and there will be no one size fits all. Studios have more ways than ever to monetize their content, and consumers know they have options. top gun and its film franchise can still draw crowds to the big screen — but not every film has the right to require viewers to pay $15 or more for a ticket.
Paramount’s stock fell 0.2% Tuesday midday, while the S&P 500 index posted a similar decline. AMC stock is up 2.6%, Cinemark is up 0.9% and the owner of Regal Cinemas is up
(CINE.UK) fell nearly 9% in London trade.
Write to Nicholas Jasinski at [email protected]