Marvel Cliffhanger: Robert Downey Jr.'s $50 Million Sequel Showdown

Iron Man Report Item - H 2013
<p>Iron Man Report Item - H 2013</p>
A Spago dinner sets the stage for Downey's epic contract talks that could lead to more "Avengers" and "Iron Man 4" -- or a new Tony Stark.

On May 6, Robert Downey Jr. and about 20 well-wishers settled into a private dinner at Spago organized by his wife and producing partner, Susan Downey. Marvel Studios chief Kevin Feige attended, as did Disney Studios head Alan Horn and director Shane Black.

The Monday night get-together ostensibly was to celebrate the amazing opening for Iron Man 3, which scored the second-highest domestic bow to date with $174.1?million (second only to Downey’s own The Avengers at $207.4?million). Internationally, where the movie opened earlier, the tally stood at $504.8?million for a worldwide total of $678.9?million after just 10 days.

But the meal also kicked off a crucial period for Disney, Marvel and Downey because the actor -- arguably the center of the mega-grossing Marvel movie universe -- is not signed for another turn as Tony Stark. Sources close to the dealmaking say Downey has entered negotiations to reprise his role in Marvel’s The Avengers 2 and The Avengers 3, the first of which has a May 1, 2015, release date and will cap what is known as Phase 2 of the Marvel movies in the same way 2012’s Avengers culminated the first Marvel wave that began with 2008’s Iron Man. Avengers 3 has no release date and probably will not hit screens at least until the end of Phase 3, in 2017.

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But sources say Iron Man 4 has not been part of the discussions, and it’s unclear whether Downey, 48, wants to return for another stand-alone sequel.  

Signing him for one or multiple movies won’t be cheap. When Iron Man became a surprise blockbuster, Downey’s CAA reps negotiated a deal to include what sources told THR in 2012 is a slice of Marvel’s first-dollar gross from every movie in which he plays the character. One source pegged that in the 5?percent to 7?percent range; Disney, Marvel and Downey’s reps declined comment. For Avengers, Downey’s pay zoomed past $50?million with box-office bonuses and backend, a number the actor confirmed in the June issue of GQ. “Isn’t that crazy? They are so pissed,” he said of Marvel. “I’m what’s known as a strategic cost.”

That strategic cost likely will be about the same for Iron Man 3. And it might go up if Marvel, led by the famously frugal Ike Perlmutter, wants Downey back. The numbers suggest Downey, far more than any other Marvel player, is worth his price. Despite success launching stand-alone franchises in Thor and Captain America, the fact is the Marvel movies in which Downey appears perform far better than those in which he doesn’t. Iron Man 2, for instance, outgrossed Thor by 39?percent and Captain America by 69?percent worldwide. 

Thanks to the success of the Marvel movies and their ancillary revenue, analyst Doug Creutz of Cowen and Co. says the unit generates $400?million to $500?million in annual operating income, about 5 percent of Disney’s total haul. With taxes, Creutz believes Disney CEO Robert Iger’s $4.3?billion acquisition of the company in 2009 will have paid for itself in 15 years, far earlier than analysts first predicted. Even Paramount, whose right to distribute Iron Man 3 was bought out in the 2009 Disney deal, will earn more than $100?million if the film continues its trajectory, according to another analyst. 

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Cruetz suggests a Downey departure could cost Marvel as much as 9?percent of its earnings in the near term. “It would be a definite negative for that particular franchise. "He is Tony Stark. The other individual franchises -- Thor, Captain America, Hulk -- etc., don’t have near the level of box-office potential that Iron Man does,” says Creutz. “The other way to look at it is that Iron Man would probably look more like those other franchises in terms of box-office performance without Downey.”

But Iron Man wouldn’t die if Downey left, nor would Avengers. Actors learned long ago that no one is irreplaceable. Batman and James Bond have been played by many men. Marvel has used three actors to play the Hulk (Eric Bana, Edward Norton and Mark Ruffalo). Terrence Howard was replaced by Don Cheadle after the first Iron Man, and sources say Marvel has used the threat of recasting in negotiations with such franchise players as Gwyneth Paltrow and Chris Evans. For its upcoming Phase 2 adventure movie Guardians of the Galaxy, Marvel cast low-cost Parks and Recreation actor Chris Pratt to star and hired low-budget filmmaker James Gunn (Slither) to direct. 

Even as Phase 2 gets under way with Iron Man 3 and sequels to Thor and Captain America, Marvel is working on Phase 3. Ant-Man, a project to be directed Edgar Wright, has a release date of Nov. 6, 2015. Beyond that, the company is tight-lipped about its plans. Marvel has a writing program it uses as a concept generator and has scripts for Blade and Ms. Marvel features, for example. Doctor Strange, Iron Fist, Black Panther and The Runaways are other projects on the horizon. The company slowly has been reacquiring licenses to characters it lost during the 1990s, snapping up Blade, Ghost Rider, Power Man and Daredevil in the past year alone.

Still, a Phase 3 without Iron Man 4 might be a risk Marvel and Disney would rather not take. And Downey, who reinvented himself with the character after years of personal struggles, seems game for the challenge of being a 50-year-old superhero. “I don’t know,” he said April 30 on The Daily Show, adding with a wink, “I had a long contract with them, and now we’re gonna renegotiate.”

“The flapping hair and fabric of their wardrobe was the most daunting rotoscoping and compositing task I have ever been involved in,” says Digital Domain’s VFX supervisor Erik Nash."]