Billion Dollar Batman

by Bruce Scivally

  Ian Thomson of the U.K. Film Council noted that of all the American studios, Warner Bros. was the one that made the most use of British talent and facilities; its Harry Potter franchise was shot at another abandoned British air base, Leavesden, which had first been converted into a film studio for the 007 film Tomorrow Never Dies. The studio also shot Charlie and the Chocolate Factory, Phantom of the Opera and Alexander at British studios. “Studios know they get value for money here,” said Thomson, noting that even though the dollar was weak against the pound, making filming in the U.K. expensive, there was world-class talent available in the British Isles.208

  The studio was able to spend more on their movies thanks to the added influx of revenues from foreign home video. At a time when the Motion Picture Association of America was claiming losses of $3.5 billion a year due to the sale of illegally pirated films on videotape and DVDs, overseas the studios were seeing record profits from legitimate sales of home video in foreign markets. According to The New York Times, foreign home video sales were the fastest-growing revenue stream for the studios. British data firm Screen Digest calculated that the home video divisions of the studios brought in $11.4 billion in wholesale revenues from the $24.6 billion spent by overseas consumers buying and renting home videos in 2004.209

  The increased cash flow from foreign home video sales had an impact on the business. Films with big international appeal, like the new Batman film, saw increased budgets. Top stars began negotiating a larger share of the profits, and the studios began spending millions more to fight piracy, particularly in developing markets in Asia and Russia. The labor guilds negotiated new contracts to give them a bigger slice of the DVD pie, which the studios vigorously fought against giving up. It became common practice for studios to underreport revenues from international home video and to misrepresent those revenues to talent who had back-end deals that guaranteed them a share of the profits. In filings with the Securities and Exchange Commission, studios did not specify which revenues came from international home video divisions; instead, those sums were lumped with theatrical revenues in a category called “filmed entertainment.” In order for talent to get an accounting that would break the video numbers down between foreign and domestic gross revenues, they had to do an expensive audit.210

  Part of the problem was that while domestic sales and rentals could be tracked through bar code information, no independent company or trade publication had the financial power to track international sales and rentals through bar codes. The most that the studios were willing to divulge was how many units had shipped. For instance, Warner Home Video reported that the third Harry Potter film, Harry Potter and the Prisoner of Azkaban, shipped 27 million units worldwide as of January 2005; Dreamworks’ Shrek 2, the top international seller of 2004, shipped 37 million units, with 13 million of those outside the U.S.211

  For top stars, the audits were worthwhile. Unlike guild members who were locked into a royalty fee schedule, top film stars could negotiate their own portion of home video earnings, meaning they could pull in up to a 7% royalty of gross revenues, or about a dollar for every DVD sold. By contrast, the rest of the movie’s cast normally earned a royalty share of 1.1%. But the studios had no intention of letting the guilds negotiate a larger share.212

  Charles Roven, one of Batman Begins’ producers, said, “For a long time, the film business was a single-digit business on investment return. Now, because of home video, it’s a low double-digit business, and the studios want to make sure it doesn’t go back into the single-digit business.” With the expectation of high home video revenues, Roven was reportedly able to get a budget for Batman Begins of more than $180 million; it was expected that the film’s worldwide marketing budget would be more than $100 million. Plunking down over a quarter of a billion dollars was a huge risk for Warner Bros., considering that their previous Batman movie, Batman & Robin, had brought in only $238 million in worldwide ticket sales. But, Roven said, “Warner Brothers would not be putting this kind of money into the film unless someone thought the investment would be retuned in home video.”213

  Warner Home Video was the leader among the studios, with a 20% share of international wholesale revenues; in 2004, the company grossed a reported $2.25 billion in international revenues, and the studio expected that that figure could hit as much as $6 billion in the next few years.214

  The monster budget of Batman Begins was even less of a concern to the studio thanks to the intervention of Thomas Tull, the 35-year-old head of Legendary Pictures. Just as Batman Begins was set to open, Tull showed up on the Warner Bros. lot with a $500 million private equity fund. After meeting with Warners’ execs, he put up half the funding of both Batman Begins and the upcoming Superman Returns.215

  A self-described movie geek from Binghampton, New York, Tull made his first riches buying and selling a Laundromat chain. He then worked for the Atlanta-based Convex Group, a company begun by WebMD founder Jeff Arnold that invested in new media networks such as LidRock, which Convex owned. LidRock put promotional CDs in the lids of soda cups. The company later got into the disposable DVD market when they bought Flex Play. He also made millions with hundreds of Jackson-Hewitt tax-preparation franchises. In 1996, Tull got his first taste of Hollywood when he helped create Red Storm Entertainment, a company that created games based on the novels of Tom Clancy.216

  With his skills as a venture capitalist, Tull went to investors such as ABRY Partners, Banc of America Capital Investors and AGI Direct Investments and raised the capital to form Legendary Pictures. “We got a ticket to the ballgame,” said Tull. “That’s it. Now, we need to make things work.”

  In the fall of 2003, he attended a dinner party in the Hollywood Hills where he met MGM president Chris McGurk. The two men got into a conversation about the sometimes involved methods Hollywood uses to raise cash for film productions. Tull realized that the kinds of private equity and venture capital money he had access to were more concerned with manufacturing companies, technology and health care start-ups. Film production represented a new frontier for private equity investment.217

  Joining together with several Hollywood veterans, including former TriStar Pictures production chief Chris Lee, marketing executive Scott Mednick and former Creative Artist Agency chief financial officer Larry Clark, Tull formed Legendary Pictures. The group raised $500 million in cash from investors.218 Their deal with Warner Bros., in which they agreed to co-finance and co-produce films, made them equal partners with the studio. Besides bankrolling the Batman and Superman franchises, Legendary planned to develop their own projects in consultation with the studio. They would treat their slate of films as a portfolio, making films in different budget ranges and genres to insure against potential losses.219

  At the end of April 2005, Warner Bros. moved the release date of Batman Begins from Friday July 17 to Wednesday July 15. The move was prompted by two factors—kids being out of school for summer, which would make for a bigger mid-week opening, and—more importantly—the plans to open the film internationally on the 15th. It was due to open not only in the U.S. but also France, Belgium, Mexico, the Philippines and Taiwan.220 “Internationally, some territories historically prefer Wednesday openings,” said Dan Fellman, Warners distribution president. “We felt we’ve had such great support from the fans that we did not want to have it open somewhere else before the U.S.”221 In its further efforts to promote the film, Warner Bros. hit right at a portion of its target audience on May 18, 2005, when the 90-minute season finale of Smallville ended with an 8-minute preview of Batman Begins.222

  Batman Begins became the first film based on a DC Comics character to sport the new DC logo, created by Josh Bateman of Brainchild Studios. Previously, a DC logo had only appeared on comic books and graphic novels. Now, a newly- designed logo would brand not only the comic books but also the films, television programs, merchandising and games endorsed by DC. The new logo debuted on the May 25th cover of DC’s comics; an animated version debuted at the beginning of
Batman Begins.223

  Instead of just relying on print and TV saturation, the marketing plan for Batman Begins began on the internet. Warner Bros. set up a website in March of 2004 to promote the film. When they posted a trailer on the website over the summer, it generated buzz on fan sites and blogs. Warner Bros. then invited the operators of some of the fan websites to the film’s set.224 An integrated marketing campaign drove website visitors to the 8-minute preview of the film that was presented during Smallville. Then there was a flurry of banner ads on websites until the film’s release.225

  Dawn Taubin, president of domestic marketing for Warner Bros., said, “We made a conscious decision to start and live in the on-line world for the movie. We felt we had a core audience, and that core fan showed slight disappointments [in the] direction the previous movies had taken. We wanted to go back to the original core material. We made a specific decision to release the new logo and the new art online—rather than give it to, say, USA Today.”226

  Advertising on the internet was a growing business. In 2004, the internet took in $86 million in advertising spending by movie companies. Though that was a pittance compared to the $1.8 billion spent on TV advertising and $1.2 billion spent on newspapers, it was 41% more than had been spent on internet advertising the year before. More importantly for the studios, internet ads targeted the coveted 12-to 24-year-old audience.227

  On June 4, the 2005 MTV Movie Awards broadcast kicked off with host Jimmy Fallon being driven to the show by Batman in the Batmobile, thanks to some clever editing that mixed shots of Fallon with clips from Batman Begins. The piece ended with Batman revealing himself to be Napoleon Dynamite, played by Jon Heder.228

  The movie had its Los Angeles premiere on Monday, June 6, 2005 at Graumann’s Chinese Theatre in Hollywood. The film’s Morgan Freeman, Liam Neeson, Michael Caine, and Gary Oldman were present, as was Katie Holmes with boyfriend Tom Cruise. Christian Bale arrived sporting a beard.229 When asked about the TV concept of Batman, Bale said, “Only Adam West can fill those shoes. I’ve got a lot of respect for the way he chose to play Batman, but that was a spoof of what Batman is meant to be. I was looking to fill a whole different pair of boots.”230 Other stars present on the red carpet were Adam Brody, Chris Kattan, Dave Navarro and Brooke Burke.231 An after-party was held at the Kodak Theatre next door, but Cruise and Holmes decided not to attend.232

  When Batman Begins opened on Wednesday, June 15, 2005, it bowed in 3,718 theatres in the U.S.233 The film also premiered in Imax theaters, digitally remastered in the Imax format and retitled Batman Begins: The Imax Experience.234 On the following Friday, it added another 140 theatres, for a total of 3,858, the widest release in the studio’s history. Internationally, the film opened in Belgium, France, Switzerland and the Philippines on Wednesday; Australia, Germany, Holland, Hong Kong and Singapore on Thursday; Italy, Spain and the U.K. on Friday; and Japan on Saturday.235 Christopher Nolan, Christian Bale, Katie Holmes, Michael Caine and Morgan Freeman went on a worldwide tour to promote the film, with Warner Bros. staging five foreign premieres. The first was in Tokyo in late May, followed by London on June 12, Berlin on June 15, Paris on June 21 and Rome on June 23.236

  Many observers expected the film would end up with an opening weekend tally around $70 million, provided it could widen its audience beyond the 18- to 34-year-old males who, according to studio tracking, were showing the most interest in seeing the film.237 After 16 weekends in a row where revenues were down compared to 2004, Warners was hopeful that Batman Begins would reverse the trend. On its opening day, it brought in $15 million.238

  Over the weekend, the film grossed $46.9 million, for a total Wednesday through Sunday box-office take of $71.1 million. Just looking at the grosses for the Friday through Sunday period, Batman Begins outperformed 1997’s Batman & Robin, which made $42.9 million on its opening weekend, but earned less than 1995’s Batman Forever, which took in $52.8 million. In reporting the figures, Daily Varietyalso noted that ticket prices had increased by more than 40% over the decade.239 Although it was hoped that Batman Begins would bring the box-office out of its doldrums, the total weekend box-office of $133 million was down 2.6% from the previous weekend’s $136.8 million take.240 Overseas, the film grossed $41.7 million in its first five days.241

  The film had its London premiere at the Odeon Leicester Square on June 12. Director Christopher Nolan spoke of a film “made in England...that only U.K. technicians could have made,” drawing applause from the crowd, particularly after rumors had circulated in the press that both the James Bond and Harry Potter franchises might relocate to Eastern Europe because of fears that U.K. tax incentives would be cut. The premiere was followed by an after party at the Royal Courts of Justice on the Strand.242

  REINVENTION

  Todd McCarthy of Daily Variety gave the film a mediocre review, saying, “Ambitious, well made but not exactly rousing, lavishly produced Warner Bros. release will ride heavy promotion and want-see to big openings worldwide, but is too dark and talky to appeal to kids and won’t inspire much repeat viewing, which casts sought-after blockbuster B.O. in some doubt...The filmmakers seem intent upon making Bruce/Batman and his actions as plausible (one resists saying realistic) as possible, emphasizing that he’s a distinctly human hero with no super powers. All the same, guys, he was still born in a comic book, and it’s doubtful Batman would have lived very long had the original DC comics been as drained of sheer childlike fun as this film is. There is talent and cleverness here, but not much excitement...With an ideal physique and bearing for the role, Bale makes for a committed, driven, urbane and intelligent do-gooder; only oddity is the somewhat electronic quality of his voice as Batman.”243

  The Wall Street Journal struck a similar note, with Joe Morgenstern writing, “A weaponized hallucinogen threatens to devastate Gotham City in Batman Begins, which stars Christian Bale as the latest, as well as the gravest, embodiment of the Dark Knight. For better and worse, Christopher Nolan’s defiantly dark retelling of the pulp legend amounts to a theatricalized hallucinogen. This beautifully crafted film has the power to cloud our minds, even to bend them, with its visual splendors, sepulchral tone, vivid sense of place and elegant, if intermittent, action. But there may also come an awakening, at least for grown-ups—a realization that much is being made, at great length, of a ponderous story about a depressed hero who isn’t much fun to be with.”244

  In Rolling Stone, Peter Travers wrote, “Director Christopher Nolan, who wrote the script with David Goyer, shows us a Batman caught in the act of inventing himself. Nolan is caught, too, in the act of deconstructing the Batman myth while still delivering the dazzle to justify a $150 million budget. It’s schizo entertainment. But credit Nolan for trying to do the impossible in a summer epic: take us somewhere we haven’t been before...Like any movie with a surfeit of villains, none of them stick. Cillian Murphy comes closest as Dr. Jonathan Crane, a skinny shrink they call Scarecrow when he puts a burlap bag on his head. Each person sees his own worst fears come to life when they gaze at the bag. The low-budget headgear is typical of a movie that succeeds best when it hews to the rule of less is more. Beginner’s luck evaporates when Nolan ends with a tricked-out car chase and a doomsday plot about a poisoned water supply. Nolan’s too good for Bat business as usual. His secret for making Batman fly is as basic as black: Keep it real.”245

  Most reviewers, however, were much more enthused about the film than McCarthy, Morgenstern and Travers. Kenneth Turan, film critic for The Los Angeles Times, wrote, “Batman has finally come home. Not just to a story that painstakingly details his origins but to an ominous style that suits it beautifully. Christopher Nolan’s Batman Begins disdains the mindless camp and compulsive weirdness that mostly characterized its quartet of predecessors and unapologetically positions its hero at the dark end of the street...This Batman is a carefully thought out and consummately well-made piece of work, a serious comic-book adaptation that is driven by story, psychology and reality, not special effec
ts.”246

  In The New York Times, Manohla Dargis wrote, “Batman Begins is the seventh live-action film to take on the comic-book legend and the first to usher it into the kingdom of movie myth. Conceived in the shadow of American pop rather than in its bright light, this tense, effective iteration of Bob Kane’s original comic book owes its power and pleasures to a director who takes his material seriously and to a star who shoulders that seriousness with ease...As sleek as a panther, with cheekbones that look sharp enough to give even an ardent lover pause, Mr. Bale makes a superbly menacing avenger...It’s amazing what an excellent cast, a solid screenplay and a regard for the source material can do for a comic book movie.”247 Dargis later put the film on her list of The Best Films of the Year.248

  James Christopher, reviewer for The Times of London, wrote, “What might inspire a billionaire playboy to dress up in a bat suit in order to beat the stuffing out of shifty creeps at 2am? Is there anyone out there mad enough to take this challenge seriously? Step forward Christopher Nolan. I know you’re mostly British but your days as an obscure and fashionable young auteur are over...I honestly thought we’d seen the last of Batman when Tim Burton and Joel Schumacher hammered wooden stakes through the hammy franchise in the 1990s. I never expected a guided tour of Bruce Wayne’s brain ten years later, or a director crazy enough to conduct one. But Nolan bucks the lethal odds. Batman Begins is a clever surprise. It’s an exhilarating medley of bruising action that begins in the dark corridors of the caped crusader’s psyche.”249