It seems strange to hear two of the most successful blockbuster moviemakers in Hollywood history warning that the blockbuster-driven Hollywood system is due for a “meltdown.” But that’s just what Steven Spielberg and George Lucas put forth in a speech to mark the opening of a media center at the University of Southern California earlier this week. The prediction, which warned of overreach in the drive to create ever-larger tentpole productions, was just one of several bold prophecies offered by the two longtime friends and USC film alums (Spielberg gained an honorary degree in the ’90s).
The wide-ranging speech also touched on moviemaking, video games, technology, and other related subjects that add up to a vision of the future of entertainment itself. Spielberg and Lucas have given the world some truly iconic depictions of the future — even if one saga was set long ago in a galaxy far, far away — so it’s worth listening to what they have to say. Let’s run through the big claims one by one.
Spielberg: A streak of bad blockbusters will destroy the cinema system.
You’re at the point right now where a studio would rather invest $250 million in one film for a real shot at the brass ring than make a whole bunch of really interesting, deeply personal — and even maybe historical — projects that may get lost in the shuffle because there’s only 24 hours. There’s going to be an implosion where three or four or maybe even half a dozen of these mega-budgeted movies are going to go crashing into the ground, and that’s going to change the paradigm again.
This seems like an odd thing to say, because we’ve already seen a stretch of abysmal box-office blockbuster bombs somewhat like what Spielberg’s predicting, and none of the studios died as a result. The yowlingly bad Catwoman lost big on a budget of $100 million and Alexander barely broke even on its $155 million budget in 2004, and then 2005 saw two of the all-time biggest box-office losers as Sahara and Stealth combined to lose about $250 million. Time Warner Inc (NYSE:TWX)‘s Warner Brothers released both Catwoman and Alexander but kept chugging.
The thing is, $250 million is a lot of money, but it’s not the entire fortune of most media companies. Even the all-time record-breaking flop that was John Carter didn’t do much to dent The Walt Disney Company (NYSE:DIS)‘s fortunes. That film came out 15 months (or five quarters) ago — since that time, Disney’s revenue is up 5%, its profit is up 15%, and its share price is up 50%.
Credit: The Walt Disney Company (NYSE:DIS)
Spielberg seems to be looking at the megablockbuster era as a sign that all the heaviest movie-making eggs are going into one flimsy basket. But Dreamworks Animation Skg Inc (NASDAQ:DWA) and the DreamWorks Pictures studio, both of which Spielberg founded, are pretty much exclusively film producers (with some TV shows). They do live or die (or near enough) based on the chance of a massive hit or a devastating flop. Dreamworks Animation Skg Inc (NASDAQ:DWA) has just two movies on its 2013 slate (one of which came out in March), and DreamWorks Pictures also has only two.