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A version of this story first appeared in the August 7 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.
In November, as she attempted to revive Sony Pictures’ fading fortunes, studio co-chair Amy Pascal emailed a note to her chief lieutenant Doug Belgrad. Assessing Sony’s lineup for 2015, she wrote, in all caps, “THERE ARE TOO MANY DRAMAS/NOT ENOUGH TENTPOLES/NO OBVIOUS BREAKOUT HITS.”
Those words would prove to be more than a little prescient. More than halfway through 2015, Sony barely is hanging on at the box office. The studio has fallen to seventh place in domestic market share — behind the five other majors and Lionsgate — with a mere $247 million in grosses, just 3.74 percent of the total pie. Globally, Sony has made a weak $564 million. (By comparison, leader Universal Pictures has pulled in $1.8 billion domestically and more than $5 billion worldwide.) As its peers all have released at least one film that has earned $300 million worldwide, Sony’s highest-grossing movie, Paul Blart: Mall Cop 2, topped out at only $104 million. Its latest attempt to create a homegrown tentpole, Adam Sandler‘s Pixels, isn’t reversing that downward trajectory. The sci-fi comedy about arcade game aliens, co-starring Josh Gad, Michelle Monaghan and Peter Dinklage and with a budget officially pegged at $88 million, opened July 24 to only $24 million domestic, picking up another $25 million overseas.
Even though the movies Pascal shepherded have determined the studio’s 2015 standing, she is, of course, no longer at the helm. On Feb. 5, she transitioned into a four-year production deal worth as much as $40 million (four days later, speaking at a conference in San Francisco, Pascal admitted she’d been “fired”). While it widely was assumed that she had taken the fall for her handling of the destructive computer hack that hit Sony on Nov. 26 — as well as her embarrassing emails that it exposed — her exit now appears to be a precursor of what Sony Pictures chairman and CEO Michael Lynton suspected would be another difficult year.
During her long tenure at the studio — she had run Sony’s Columbia Pictures since 1996 and had headed the motion picture group since 2003 — Pascal enjoyed plenty of success. As recently as 2012, the studio, thanks to movies like the James Bond entry Skyfall, The Amazing Spider-Man and Men in Black 3, led its rivals in market share. But the wheels had already started to come off. Even though it grossed $758 million worldwide, Sony’s latest Spider-Man entry was considered a disappointment, forcing the studio to rethink the franchise and eventually partner with Disney’s Marvel Studios to reboot it. Other movies, like the $225 million MIB 3, were simply too expensive. When a string of 2013 movies like Will Smith’s After Earth, Channing Tatum’s White House Down and Matt Damon’s Elysium all came up short, Lynton and Pascal came under increasing pressure both to cut costs and establish bankable franchises. But hits proved elusive, and 2014 ended disastrously: The studio’s big holiday film, the family musical Annie, mustered just $134 million worldwide, while Seth Rogen and James Franco’s The Interview saw its theatrical potential cut short thanks to the hack, the ensuing threats and the major theater chains’ refusal to show it.
The studio has tried to right itself — Lynton tapped Tom Rothman of Sony’s TriStar unit to replace Pascal, and a new marketing and distribution team was installed last year — but Pascal didn’t leave them much to work with. So far this year, the studio has released a handful of films: The Wedding Ringer, the Kevin Hart comedy from its Screen Gems division, attracted $80 million worldwide. The sci-fi robot story Chappie leveled out at $102 million; Aloha, Cameron Crowe‘s Hawaii-set rom-com, barely registered with $24 million; and the $30 million Mall Cop 2, while likely profitable, lagged behind the first film and has been overshadowed by comedies like Melissa McCarthy‘s Spy and even Ted 2.
The Pixels backstory provides insight into the studio’s troubles. Based on a 2 minute and 35 second animated short, the project was developed by Sony and Sandler’s Happy Madison Productions. When Chris Columbus was brought in to direct, he excitedly wrote to Pascal about a rewrite of the script, “This officially turns this movie into a perennial, a film that families can watch together for the next thirty years,” predicting, “It now feels like a gigantic four quadrant event.”
But Lynton and Pascal fretted over its projected budget of $135 million. Looking for a financial partner, the studio put feelers out to Paramount, Fox and Warner Bros., with no takers. After wrangling concessions from the filmmakers, they got the budget down to $110 million, and LStar Capital — with which Sony has a three-year, $200 million co-financing deal — took a piece of the film, while the China Film Group made a small equity investment. (Sony execs were careful to excise any references, including an attack on the Great Wall of China, that might have endangered that support.) Tax incentives — the film shot in Canada — reduced the cost further to $88 million, according to the studio, which declined to comment for this story.
Exactly when to launch the film then became a matter of debate. Sandler, who has made several of his biggest films at Sony (including the still-active Grown-Ups franchise) and wields clout despite a spotty recent track record, wanted a May 15 bow. The film originally was penciled in to open against Mad Max: Fury Road until execs got nervous about that match-up. It was decided that moving Pixels to July 24 was a safer bet, but that decision angered director Judd Apatow, whose Trainwreck originally was to have opened the same day. “I am not pleased that you all did that to me,” he complained in an email to Pascal. “And the [Amy] Schumer movie is spectacular. It won’t be an easy comedy weekend. You miscalculated.” Trainwreck eventually moved up a week and notched a $30 million weekend, better than Pixels‘ bow.
Heading into the second half of the year, Sony’s fortunes will depend on a mix of Pascal’s legacy movies and Rothman’s first efforts. There is one surefire hit on the horizon: The James Bond adventure Spectre, which Sony produced with MGM and Eon, arrives Nov. 6 (though Sony splits profits three ways). But Aug. 7’s Ricki and the Flash, starring Meryl Streep as an aging rocker, is a question mark and represents the first of the movies that Rothman oversaw during his two years running TriStar. His biggest 2015 gamble will be Robert Zemeckis‘ The Walk, a 3D restaging of Philippe Petit‘s 1974 high-wire act at the World Trade Center, which stars Joseph Gordon-Levitt and is opening the New York Film Festival in hopes of establishing an awards season run.
The animated Hotel Transylvania 2, (with voice work from Sandler and Selena Gomez) is slated for Sept. 25; Goosebumps, based on the best-selling kids horror title and originally set for summer, was pushed to October. And Sony’s year-end offerings could be as problematic as last year’s. If The Interview upset North Korea, Rogen’s new film The Night Before. a comedy about Christmas Eve debauchery featuring a church vomit scene, could prompt accusations of taking a side in the war against Christmas. And Sony is courting more controversy with Concussion, starring Smith in a drama about head injuries to NFL football players. NBC Sports reported July 25 that league owners already are plotting how to respond to the movie.
If there’s a bright spot for Sony, it’s also connected to Pascal. She is now among the producers on the highly-anticipated female Ghostbusters, scheduled for summer 2016, and the Spider-Man reboot, slated for the following year. “It takes time for new management to realign the whole operation,” says analyst Harold Vogel. “I don’t think you can expect too much for six months or a year.”
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