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Why Hollywood is Killing off the $200m blockbuster

Why Hollywood is Killing off the $200m blockbuster

In 2013, Steven Spielberg told an audience at the University of Southern California that the last days of the blockbuster were at hand. As the 27-year-old director of Jaws, Spielberg himself had done more than any other filmmaker to kindle Hollywood’s love of big-spend, big-splash cinema. But almost four decades later, he sensed a coming shift.

“There’s going to be an implosion,” he told the crowd, “where three or four or maybe even a half-dozen mega-budget movies are going to go crashing into the ground, and that’s going to change the paradigm.”

Exactly 10 years later, his prophesy came to pass. In 2023, cinema attendance in the UK boomed, with the box office breaking the £1 billion barrier again for the first time since the pandemic. But five films which, pre-Covid, would have probably looked like safe bets were among the year’s most notable bombs. Indiana Jones and the Dial of Destiny, The Marvels, Ant-Man and the Wasp: Quantumania, The Flash and Wish: all cost $200 million or more to produce; all fell dismally short of breaking even on release.

They were also pretty bad. Strikingly, four of them were released by Disney, and fell into the three genres – Marvel franchise entry, CG animation, and swashbuckling Lucasfilm revival – that over the preceding decade had made the studio the most powerful on the planet. Instead, the two most commercially successful films of the year were a candy-coloured comedy musical and a biopic of a nuclear physicist – the budgets for both of which had been around half, or less, of all those lavish flops. 

To add insult to injury, both were critically acclaimed, and went on to become awards season mainstays – a feat that, despite ill-conceived wheezes like the abortive Best Popular Film Oscar, the previous decade’s mega-productions had never pulled off. 

So something has shifted – and Hollywood appears to be shifting with it. Look at this year’s relatively thrifty summer blockbuster slate, featuring Furiosa: A Mad Max Saga and The Fall Guy, both made on Barbenheimer budgets and no less appealing for it. Or listen to the rumble of assent at this year’s Academy Awards when the Best Adapted Screenplay winner Cord Jefferson (the writer and director of American Fiction) suggested to the studios that in future, rather than making one $200 million dollar movie, they might try making 20 $10 million dollar movies instead.

The collapse of the $200m blockbuster is a very modern cautionary tale, in that it’s hard to tell exactly where the cultural reasons for it end and the financial ones begin. Regarding the former, it certainly seems to be the case that cinema-goers are now tiring of the brands these films have been hawking for more than a decade, like Marvel and DC. 

And it’s arguable – or at least, it’s argued constantly, mostly on YouTube – that the general audience has also wearied of all that perfunctory progressive messaging, which was only there in the first place to make pietistic Twitter types feel good about rooting for (or making) corporate produce.

Last year, Zygi Kamasa sensed change was afoot, and made a move. The former Group CEO of Matthew Vaughn’s Marv Studios struck out on his own in November 2023 to launch True Brit Entertainment, an independent UK production company which will work in the budget band bigged up by Jefferson on the Oscar stage. 

At Marv, Kamasa oversaw the development of the Kingsman franchise, whose budgets ballooned from $85 million in 2014 to $200 million with this February’s Argylle. But as the business heaved itself out of the pandemic, he says, he “felt a change of mood among all of these established British directors who had gone off to work in television over the last decade because it had become so difficult to find the money to make crowd-pleasing films in that mid-budget range. They wanted to make films for the cinema again, and they all had great ideas for films that they wanted to make.” 

Market research suggested people wanted to see them, too. Kamasa commissioned a survey of 1,000 regular cinema-goers in the UK, asking them to rank the sort of films they wanted to see more of. “Original stories” came first, with “British stories” close behind it. (“Superheroes” came last.) Since launching True Brit in November, Kamasa already has two features underway: Marching Powder, a drug-fuelled crime caper that reunites The Football Factory’s star and director, Danny Dyer and Nick Love, and an untitled London-set festive musical by Gurinder Chadha, with songs by Gary Barlow, loosely inspired by A Christmas Carol. Two more are to be announced in the following weeks.

As evidence of audience demand, Kamasa points to the unexpected commercial success of three recent mid-budget releases with no awards-season momentum behind them: the romantic comedy Anyone But You, the Anthony Hopkins-led period piece One Life and the foul-mouthed comedy Wicked Little Letters.

“Cinema has always stormed back as a popular art form when it’s given audiences something they can’t get at home,” he explains. “In the 1970s, it was boundary-breaking content. In the noughties, it was spectacle. Today, I hope, it’s originality.”

Odd as it may seem to describe a rom-com starring the very conventionally hot Glen Powell and Sydney Sweeney as original, Kamasa is dead right: when the cinematic universes took over, this once-ubiquitous genre was mothballed in the 2010s. And with streaming platforms milking formulas as doggedly as Hollywood milks IP, novelty is a serious enticement.

But what of the raw economics? Even before Covid bit, the franchise model drove costs higher and higher, partly because escalation was in its very nature In order to meet release dates scheduled years in advance, films were also regularly hustled into production without complete scripts, usually necessitating costly reshoots. And increasingly vast sums were being spent on visual effects – between 1,500 and 3,000 individual shots per film, often churned out at speed. 

But, explains Paul Ashton, the head of film and TV at Creative UK, the pandemic turned that climb into a spiral.

“First there was an entire new tier of health and safety protocols to pay for, which extended the lengths of film shoots in turn,” he says. “But because many crew, tech and craftsmen and women had to leave the industry during the Covid shutdown because of a lack of work, that created a shortage for when things got back up and running, so employment costs went up with demand.” 

The sharp rise in inflation linked to the cost of living crisis has also taken its toll. “If the price of food has gone up on a weekly shop, imagine that multiplied across all cast and crew for the duration of the shoot,” Ashton continues, nothing that “even at the lower end of the scale,” it’s become almost impossible to make a debut feature for less than £3 million. “It’s hard to believe that as recently as 2016, a film like Lady Macbeth could be made for £500,000.”

Studios did once work at that scale too. During the indie boom of the 1990s, many launched boutique sub-branches, like Paramount Vantage and Focus Features, which gave filmmakers free rein on cheaper, riskier projects while the main divisions rebuilt themselves around fantasy and superhero properties. 

But within 10 years, executives had lost touch entirely with how those more creatively ambitious films worked: when Warner Independent was shut down in 2008, the parent studio was so bamboozled by an India-set drama Danny Boyle had just shot for them that they toyed with sending it straight to DVD. Instead, they offloaded it onto Fox Searchlight – and a few months later, Slumdog Millionaire had won eight Oscars including Best Picture, and was well on its way to making $378m worldwide.

Elizabeth Karlsen, of Britain’s Number 9 Films, cut her teeth during that 1990s heyday – one of her first producing credits was on Neil Jordan’s The Crying Game – and, in the last few years, has had to work around the mega-blockbuster crunch. While shooting the steamy period piece Mothering Sunday between the 2020 lockdowns, “it was surprisingly easy, because everyone was so keen to get back to work,” she recalls. “But a year later, making Living with Bill Nighy, the amount of money being spent at infinitely higher budget levels meant there was barely any crew or equipment left for us. We were literally ringing round film schools asking if we could borrow their lights.” 

Jeremy Hunt’s newly announced financial incentives, where British films with budgets up to £15m will receive tax relief of 40 per cent, will help with that, of course. But the broader sense of impending change, Karlsen goes on, is undeniable. “Look at Anatomy of a Fall, which has almost taken £2m. Look at All of Us Strangers, which is now over £5m, and Poor Things, The Holdovers, American Fiction. These are all very different films, with no prior brand awareness built in, and they’re all doing well alongside each other. People are coming back to the cinema to see these things, and it’s so important we build on that.

“As a producer you always see these huge changes – at one point it was DVDs, at another it was streaming, then it was these vastly expensive franchises – that make you think your trusty old model of making things is about to collapse. You tell yourself, ‘it’s over, it’s over.’ But somehow it never is. And what we’re seeing now is the green shoots are showing.”