'Green Lantern' Sequel: Tepid Box Office, Big Plans Create a Tough Call (Analysis)

That’s the question Warner Bros. faces in the wake of the less-than-stellar worldwide roll-out of the superhero tentpole. The studio appears to be grappling with the challenging decision. While a top studio source told THR on Sunday that Warners was proceeding with plans for a follow-up film, a studio spokesman said Monday that no decision has been reached.

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The situation illuminates a dilemma facing Hollywood studios so intent on launching lucrative franchises that generate multiple revenue streams, including from sources other than box office, that they might find it difficult to accept the cold reality of disappointing ticket sales. And the issue arises at a delicate time for Warners. Its new studio head Jeff Robinov is basking in the glow of The Hangover Part II ($527 million worldwide and counting) but is hungry to launch a new franchise based on its DC Comics properties to replace the Harry Potter cash cow ending this summer.

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Observers note there are many factors that will determine whether the studio ultimately goes forward with a Green Lantern sequel. Most significantly, Warners must determine what kind of total gross would justify another film, particularly if a follow-up can be done for less money.

Green Lantern had a budget well in excess of $200 million, according to industry sources, as well as an outsized marketing spend estimated at $100 million domestic and $75 million foreign. A source with ties to the studio says it is reasonable to assume that Warners has spent well over $400 million on the film--not unusual for a summer tentpole—making profitability a steep uphill climb.

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Though the film is still rolling out overseas, current numbers suggest that Green Lantern could top out at $260 million or $270 million in worldwide gross. (Its cume through Sunday was $118.4 million; it has grossed $89 million domestically and $29.4 million overseas.) Green Lantern's weak foreign showing is especially problematic, considering that more than ever, international box office often drives tentpoles.

Though Warners had high hopes for the film starring Ryan Reynolds and directed by Martin Campbell, Lantern not only failed to ignite at the box office but was also rejected by critics, earning a mere 26% approval rating on Rotten Tomatoes—not that reviews are crucial to the success of movies based on toys and comic books.

Some observers outside the studio say a Green Lantern sequel would be a misstep, one which Warners probably will not end up making.

“I don’t see how they actually move ahead, even if they are dying to launch some non-Batman, non-Superman DC [Comics] heroes,” an executive at a rival studio said.

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On the other hand, Warners’ deep marketing spend has familiarized worldwide audiences with the character. And studio franchises are not just about box office any more. Disney’s Cars, one of Pixar’s lowest-grossing and least-embraced films, launched a $1 billion global licensing juggernaut that paved the way for the just-released sequel. Similarly, Warners is planning an aggressive roll-out of Green Lantern merchandise, with more than 100 global licensees, an animated series, games and theme park rides. A Lantern sequel could feed all of those revenue streams.

Plus, a talent rep associated with the film argues that the studio has learned from the first movie and could correct the tone of a sequel, hire a director with more CG experience and/or mandate a lower budget.

A script for a sequel was being developed with writer Michael Goldenberg even before the film opened as a matter of routine. And though Reynolds is said to be willing to reprise the role, several industry sources expressed doubt that another excursion would be a good move for him. “It’s not like he doesn’t have career choices,” the rival executive said. “He has no need to do it.”

Pamela McClintock contributed to this report.