Will 'La La Land' Have Lionsgate Investors Dancing in 2017?
Damien Chazelle's magical musical has become a major Oscar frontrunner for the Hollywood studio.
With La La Land co-stars Emma Stone and Ryan Gosling possibly dominating TV screens next Tuesday after the Academy of Motion Picture Arts and Sciences unveils the Oscar nominations, spare a thought for Lionsgate film distribution head David Spitz.
His toes are already tapping and Spitz, the studio's president of domestic theatrical distribution, may well burst out in song when the best picture Oscar is presented next month. That's because, after sweeping the Golden Globes and continuing to build box-office momentum, the expectations around La La Land as an improbable Hollywood hit are ballooning.
"With all of the momentum and great word of mouth, people want to see it [La La Land] again and again. The music is infectious, the acting is superb and the film is generating a lot of repeat business," Spitz told The Hollywood Reporter about Damien Chazelle's critical and box-office darling.
The movie, which got a green light from Lionsgate film exec Erik Feig after other studios passed, is already a leading best picture contender in the Oscar race. But even as golden statuettes loom in the distance, Lionsgate has started weighing just how big a lucrative score La La Land may become for a Hollywood studio needing its next hit franchise after the end of the Hunger Games and Twilight Saga runs.
Chazelle's magical musical about love-struck Angelenos, budgeted at $30 million and rolled out slowly, has grossed $132 million and counting worldwide. Studio execs, who would have been happy had La La Land grossed $50 million to $60 million before it broke out of Venice and Telluride to take the top audience award at Toronto, are now internally projecting the film to take in hundreds of millions in theatrical box office.
That should make Chazelle's passion project very profitable for the studio. "It's huge for them [Lionsgate]," Jeff Bock, a box-office analyst with Exhibitor Relations, told THR. "They kind of put their hopes and dreams in the YA adaptations and survived on that and built themselves into a major studio because of it. And then the floor fell out on the Divergent series."
Lionsgate investors have already started to cheer La La Land, as the studio's stock price has risen 17 percent from $24.10 on Dec. 6, when the film started its platform release, to a close of $28.23 on Wednesday on the New York Stock Exchange. The stock is also up 39 percent since the studio's $4.4 billion acquisition of Starz was first unveiled on June 30, 2016, ahead of the deal closing last month.
Chazelle's glossy love letter to Los Angeles has also helped validate Lionsgate's strategy to diversify its portfolio of movie releases away from pricey blockbusters. "Instead of spending $150 million on a film that no one wants to watch, spread that out over four or five movies and you might catch lightning in a bottle again and work your way to Oscar glory. That pays off sometimes," Bock explained.
The studio has two financing partners on La La Land — Black Label Media and TIK Films, a subsidiary of Chinese broadcast giant Hunan Broadcast Intermediary. But with the film's rights in hand, Lionsgate's bite at the packaged and digital media home entertainment markets is expected to be that much sweeter.
The musical, a crowd-pleaser for combining Hollywood nostalgia with an art-house sensibility, also has an upcoming pay-TV play on HBO and will help drive Lionsgate's 17 international theatrical output deals. The studio also is self-distributing La La Land in the U.K., where the movie opened strongly last weekend.
And the awards-season contender has yet to open in China. Add in soundtrack sales and spinoff content like a talked-about live stage show and that risky bet on a musical could pay off for years to come.
But at least for now, Lionsgate isn't looking to jinx itself by making predictions on La La Land getting to the Oscar podium. "We're taking it one week at a time," Spitz said as the studio eyes continued momentum before peak theatrical play is expected on Jan. 27, following the Oscar nominations announcement.
And after that, however the movie plays with Academy voters, Lionsgate could well be the first stop, and not the last, for the next passion project to break out like La La Land. "With the right people, and the right project, Lionsgate is a studio you would look for, and look to, for that financing, where you might not have before," Bock said of the studio going forward.