Warner Bros says a multimillion-dollar merchandising lawsuit from the estate of Lord of The Rings creator J.R.R. Tolkien and publisher HarperCollins has hurt it financially, undermined its rights to the author’s properties, and it wants big bucks in damages. “Counterclaim Defendants are simply attempting to extract additional huge sums of money for rights and/or take back rights that they had already granted,” the studio says in documents (read them here) filed this week in federal court. While damages are not specified in the counterclaim, the request for a jury trial does state that Warner Bros lost millions in license fees because of the fallout from the rights dispute. The claims by the studio come almost five months after the Tolkien Estate Ltd, its trustees and News Corp-owned publisher sued Warners, its New Line subsidiary and The Saul Zaentz Company’s Middle-earth Enterprises division in an $80 million copyright infringement and breach of contract dispute over video games, online slot machines and other digital merchandising. That legal move occurred just under a month before the first movie in the Warner Bros-distributed and Peter Jackson-directed trilogy The Hobbit hit the big screen December 14. The Lord Of The Rings trilogy, directed by Jackson, has made almost $3 billion in worldwide box office. READ MORE »
Don Groves is a Deadline contributor based in Sydney
Documents released by the New Zealand government today reveal more of the intense nature of the 2010 dispute over The Hobbit which threatened to move production out of the country. Included are emails between Peter Jackson and government officials which further crystallize the ire in the Shire over the aggressive tactics and demands of New Zealand Actors’ Equity and its Oz-based umbrella, The Media Entertainment and Arts Alliance — which repped a small amount of actors — during their campaign to unionize the production. The turmoil ultimately calmed when the government amended the labor laws and gave the Warner Bros production $56M to shoot in the country after Jackson threatened to film elsewhere. Jackson and partner Fran Walsh said today they hope the documents (read them here) will “put to rest the unfounded conspiracy theories that sought to characterize these events as a Hollywood studio dictating terms to a sovereign government — a charge that is as spurious now as it was then.”
Warner Bros’ latest visit to Middle Earth should generate $1.26B in revenues from all major sources — 3.59 times its expected costs — putting it on track to become the most profitable movie released in December, SNL Kagan says today. The research company builds a financial model for films by using early box office results to estimate likely revenues from theaters, home video, and free and pay TV deals against probable costs. To account for many variables it can’t ascertain (including distribution fees, interest, profit participation, and residuals), Kagan figures a movie will be profitable if expected revenues are 1.75 times higher than estimated costs. Those with a lower ratio but that are still higher than 1.40 times are in a gray area. Films below that are deemed likely money losers. By that standard three other December films will end up in the black: Universal’s Les Miserables ($396.7M in expected revenues/2.37 times costs), Weinstein Company’s Django Unchained ($473.2M/2.18X) and Columbia Picture’s Zero Dark Thirty ($230.7M/2.10X). Those falling short include: Paramount’s Jack Reacher ($253.8M/1.38X), Universal’s This Is 40 ($159.5M/1.14X), Fox’s Parental Guidance ($163.3M/1.12X), Disney’s Monsters, Inc 3D ($75.0M/0.77X), Paramount’s The Guilt Trip ($89.1M/0.57X), and FilmDistrict’s Playing For Keeps ($37.7M/0.28X).
‘The Hobbit’ Opens To $223M Worldwide As It Breaks Records Around Globe: $84.7M Domestic And $138.2M International For All-Time Christmas Release
SUNDAY 11 AM, 8TH UPDATE: Hollywood now has high hopes for this all-important holiday box office after this journey to Middle Earth is the largest Christmas release of all time. Rival studios knew Peter Jackson‘s film adaptation of the 1937 JRR Tolkien novel would be a monster hit so left this weekend alone. Warner Bros says The Hobbit: An Unexpected Journey internationally opened to $138.2M in its first 5 days for 15M admissions in 56 markets from 18,200 screens. Domestically it earned $84.7M from 4,045 theaters. That makes for a gargantuan worldwide total of $223M, including a December record of $15M from IMAX screens. Pic opened in U.S./Canada to $37.5M Friday and $28.1M Saturday and an estimated $19.1M Sunday for an $84.7M weekend with an ‘A’ CinemaScore from audiences. There are two records shattered – biggest December Friday and biggest December weekend for the domestic box office. The debut for the 3D actioner from MGM/Warner Bros in 4,045 theaters is grossing much larger than The Lord Of The Rings trilogy. Friday’s take included a record $13M from 3,100 midnight shows, counting $1.6M on IMAX screens. Matinee trends had the pic on a $113+M fast track for its first U.S.-Canada weekend. But then its business slowed Friday evening no doubt because of its very long 2 hour, 46 minute running time. Exit polling of the audience showed that males made up 57%/females 43%, and that under 25 years old were 42%/over 25 yrs old 58%/under 18 years old 20%.
The Hobbit was digitally re-mastered into IMAX 3D format and a select number of IMAX theatres will be presenting the pic using a higher frame rate (HFR) – presenting the picture in 48 frames per second (fps) which is closer to what the human eye actually sees. This is twice the rate of the standard 24 fps, which is the current format in cinemas worldwide. This use of HFR 3D is the first in a major motion picture release. Domestically, IMAX (included in the overall total) comprised $10.1M from 326 locations. As for market share, 3D made up 49% and 2D was 51%. IMAX logged multiple sellouts across North America. In fact, The Hobbit‘s top 10 North American locations were all IMAX runs.
It’s already the #1 movie internationally since opening Wednesday. Warner Bros says 3D screens represented 60% of the total box office. The Hobbit broke an IMAX December record, grossing $5M in 126 IMAX overseas locations for a hefty per screen average of $40K. (December records were set in Brazil, Spain, Singapore, Turkey, Ukraine and the UK.) IMAX HFR locations generated $44K per screen domestically and $57K per screen overseas. Country by country, Warner Bros says The Hobbit opened to: UK – £11.4M (US$18.3M) taking 62% of the market share with 3D projection 60%; Germany - €12.6M (US$16.3M) including previews, representing a 60% share with 3D taking 80%; France - €9.8M (US$12.7M) taking 63% of the top 5 films with 3D projection 60%; Korea debuted to KRW9.2B (US$8.5M); Spain €6.5M (US$8.4M); Sweden SEK39.6M (US$6.0M); Italy €4.2M (US$5.4M); Mexico Ps66M (US$5.2M); Brazil R$10.1M (US$4.9M). My insiders thought it was very possible for the movie to end this weekend with approximately $200M worldwide but it did way more. Yowza!
In the U.S. and Canada, MovieTickets said box office advance tickets for the pic accounted for nearly 91% of sales going into Friday, with nearly 18% coming from those wanting to see the film in standard 3D format, 8% in High Frame Rate 3D, and 7% in IMAX 3D. The record opening for this weekend is I Am Legend‘s $77m. Remember, all Lords Of The Rings 2D films opened Christmas Week whereas 3D The Hobbit will play to lower openings but huge multiples helped by 3D and IMAX. The Hobbit An Unexpected Journey‘s production was managed by New Line Cinema with parent company Warner Bros Pictures handling worldwide theatrical distribution. Select international territories (including Scandinavia) as well as all international television distribution was handled by MGM.
In North America, the film is playing in 4,045 theaters, a record number for December. That includes 3,160 3D theaters and 461 theaters in the 48 frames-per-second format. Overseas, The Hobbit is opening in 55 territories on approximately 17,000 screens this weekend (excluding Australia, China and Russia). The pic scored a record opening in New Zealand where it was filmed and which is Jackson’s native country, marking the biggest non-holiday debut for a Wednesday.
Warner Bros, which specializes in tentpoles, crafted an event-level marketing campaign that simultaneously had to satisfy Tolkien’s Hobbit and Jackson’s Lord Of The Rings fans but also ignite new ones. ”We were fortunate to have in Peter Jackson a director who had both a unique vision for this broad movie marketed to everyone and a sustained relationship with his singular fan base,” the studios told me. To aid that, The Hobbit included many familiar faces among the cast and filmmakers from the original trilogy: Ian McKellen returns as Gandalf the Grey, Cate Blanchett as Galadriel, Ian Holm as Old Bilbo, Christopher Lee as Saruman, Hugo Weaving as Elrond, Elijah Wood as Frodo, and Andy Serkis as Gollum. Martin Freeman plays the central role of Bilbo Baggins, with Richard Armitage as Thorin Oakenshield.
The screenplay was by Fran Walsh & Philippa Boyens & Peter Jackson & Guillermo del Toro based on the Tolkien novel. Jackson and Walsh also produced the film, together with Carolynne Cunningham and Zane Weiner. The executive producers are former Warner Bros film topper Alan Horn, and New Line chief Toby Emmerich, as well as Jackson’s longtime manager and producing partner Ken Kamins and Carolyn Blackwood. Also pivotal was Jackson’s Weta Digital, the five-time Academy Award- winning visual effects facility based in Wellington, New Zealand, as well as Weta Workship for physical effects.
The marketing campaign began back in 2011 on Facebook with a series of video journals from Jackson’s POV, engaging fans throughout the year by taking them into the production activity leading up to the announcement trailer at the beginning of 2012. Jackson also marked milestones like Hobbit Day and the novel’s 75th anniversary. Publicity included the first ever film-themed Rolling Stone standalone issue and a week of television programming on The Colbert Report. The Hobbit also received major treatment from Fall and Holiday previews. An online media blitz kicked off in early November with an advanced ticketing campaign across YouTube, Facebook and Twitter to drive early ticket sales. Warner Bros live-streamed the world premiere from Wellington, New Zealand, to a record-setting audience of a million views.
DreamWorks/Fox/Disney’s Lincoln passed the $100M mark domestically on Thursday, 34 days from its initial exclusive release in 11 theaters on November 9th. Total moviegoing this weekend was $137M, which is +15.9% over last year.
Here’s the Top Ten based on weekend estimates:
1. The Hobbit: Unexpected Journey (MGM/WB) NEW [Runs 4,045] PG13
Friday $37.5M, Saturday $28.1M, Weekend $84.7M
2. Rise Of The Guardian (DWA/Par) Week 4 [Runs 3,387] PG
Friday $1.5M, Saturday $3.4M, Weekend $7.4M, Cume $71.3M
3. Lincoln (DreamWorks/Fox/Disney) Week 6 [Runs 2,285] PG13
Friday $1.9M, Saturday $3.2M, Weekend $7.2M, Cume $107.9M
4. Skyfall (Eon/MGM/Sony) Week 6 [Runs 2,924] PG13
Friday $1.8M, Saturday $3.0M, Weekend $7.0M, Cume $272.3M
5. Life Of Pi (Fox) Week 4 [Runs 2,548] PG
Friday $1.3M, Saturday $2.3M, Weekend $5.4M, Cume $69.5M
UPDATE, 3:39 PM: Just hours after a federal judge today granted Warner Bros, MGM and others a temporary restraining order against mockbuster Age Of The Hobbits, WB hailed the court action as a victory over producer Global Asylum’s “cynical business model.” Warner Bros is the distributor of The Hobbit: An Unexpected Journey based on J.R.R. Tolkien’s novel. Here is Warner Bros’ statement:
“This victory underscores the importance of protecting the unique work of our industry’s creative community from companies like Asylum, whose cynical business model is designed to profit from the work of others. Their intent to create confusion in the marketplace on the eve of release of ‘The Hobbit,’ one of the most anticipated films of the year, has met with defeat.”
PREVIOUSLY, 2:47 PM: There will only be one Hobbit on the screen this week and that will be Peter Jackson’s The Hobbit: An Unexpected Journey. Warner Bros, New Line Cinema, MGM and producer Saul Zaentz today were granted the temporary restraining order they sought against Global Asylum’s mockbuster Age Of The Hobbits (read the order here). “There is substantial likelihood that consumers will be confused by Age Of Hobbits and mistakenly purchase the film intending to purchase The Hobbit: An Unexpected Journey“, said federal judge Philip Gutierrez today. “Indeed, Plaintiffs have presented evidence that Asylum’s other films have caused confusion among consumers, who mistakenly purchase Asylum films intending to purchase a different film”.
UPDATE: Deadline has learned that Radio New Zealand journalist Cushla Norman is in fact invited to the red carpet and press conference for Peter Jackson’s The Hobbit: An Unexpected Journey. While we understand a mistake was made in uninviting the reporter, it has been rectified and her credentials have not been revoked. People close to the situation have assured Deadline that there is no media blacklist.
Norman said earlier today that her premiere and press conference credentials had been revoked because of her negative coverage. Separately, Peter Jackson’s The Hobbit production company Wingnut Films told New Zealand’s TV3 “We don’t have — and have never had — any form of media blacklist. That’s not who we are or how we operate.”
Warner Bros and New Line Cinema are fully supporting Peter Jackson and The Hobbit producers regarding the recent allegations of animal abuse. You can read their statement below:
With a shortened nominating season (Oscar balloting starts December 17, 10 days earlier than usual), the Thanksgiving holiday period as well as the Christmas/New Year’s break won’t much of a break at all for many campaigns, which simply can’t take the time off or slow the momentum they are trying to build. After all there are just 3 1/2 weeks to go before those ballots land in Academy voters’ hands (or in the case of the new electronic voting this year, in their computers). So it is all stops out from here on in. And that means studios like Universal and Sony in particular will be using the long Thanksgiving weekend for an assault on guild and Academy members for their big December releases Les Miserables and Zero Dark Thirty, respectively.
On Saturday, Universal’s Les Miz plan swings into action with an unprecedented six screenings — all featuring either in-person introductions or post-Q&A sessions with director Tom Hooper and “cast members”. The screening program will not let up until the film’s Christmas Day opening, which comes in the middle of the voting period. Universal is determined to get this film seen on the big screen by as many voters as possible despite the time crunch. The director only just locked Sunday night at 10 PM, according to an internal memo that carried instructions for delivery of the DCP materials for the digital projection. It’s a very precise, carefully orchestrated operation, and as the memo says “failure is not an option”. That’s certainly true in an awards race as tight as this one and particularly for a film as anticipated as this one.
“The reality is we’re going to screen this movie like nobody’s business the minute it’s ready and would have regardless….We’ll start screening the movie the day after Thanksgiving and are going to screen it, pretty much non-stop from there, until time of release. So between the screening program, its commercial availability beginning Christmas Day and for those who get the screeners, we think there’s abundant opportunity”, Universal chairman Adam Fogelson told an audience of Academy and Guild members attending the Moguls panel at Deadline’s recent all-day The Contenders event. He added that for smaller films the timing could be more of a challenge, but “not for any of the films here which are on everybody’s list”.
Peter Jackson Posts on Facebook Page Defense by ‘The Hobbit’ Production Team Against Animal Cruelty Allegations
I’ve received a fuller statement from Peter Jackson and The Hobbit‘s production team regarding those animal cruelty allegations. This is what’s posting on Jackson’s Facebook page:
FROM PETER JACKSON & PRODUCERS OF THE HOBBIT
The Hobbit production has always instituted
UPDATE, 8:29 PM: Director Peter Jackson and the other producers of The Hobbit say that allegations by PETA of mistreatment of animals during the production of the upcoming film are “unsubstantiated.” Earlier today, it was reported that over two dozens animals used in the movie died from the conditions in a New Zealand farm they were housed in. The farm was over 180 miles from the movie’s main set. The producers later said that they “completely reject” the accusations. Now The Hobbit team say PETA never “properly” checked out the story of the dismissed animal wranglers that were the source of the claims. Read the producers’ full statement below:
Only about 4.5% of the 10,000 or so domestic screens that will show New Line and MGM’s The Hobbit: An Unexpected Journey on December 14 will present it the way director Peter Jackson wants — at 48 frames per second instead of the conventional 24 frames. But Warner Bros Domestic Distribution President Dan Fellman tells me that this reflects a cautious rollout strategy, not a failure to win support from exhibition execs. Even now, “equipment is being tested” and some glitches have been corrected, he says. “So we did the right thing” by limiting the rollout to anywhere from 400 to 450 screens covering most major cities. “This is a technology that is going to change the way people see movies…You have to do it right.”
Warner Bros seemed to have bigger ambitions for the visually vivid 3D projection technology — which the studio’s calling “HFR” (for High Frame Rate) — at the exhibition industry’s CinemaCon trade confab in April. That effort hit a huge PR speed bump when several viewers said that they were unmoved by a 10-minute excerpt of the film in 48 fps. Carmike Cinemas’ Terrel Mayton said at the time that HFR “has to be a kick-the-picture-out (advancement) or it just becomes one of a long line of technology advances that’s here for a while and then move into oblivion.” Theater owners have to pay about $5,000 for a projector to handle HFR — first-generation digital ones can’t be upgraded. More recent projectors only require a software upgrade which can run $1,500. It can cost as much as $20,000 to make the change at an IMAX venue. Theaters also have to shell out more to store HFR prints than they do for conventional 24 fps digital films.
‘The Hobbit’ Advance Tickets Go On Sale Wednesday At Noon ET; ‘Lord Of The Rings’ Marathon Screenings Go On Sale, Too
BREAKING… Peter Jackson’s epic fantasy adventure The Hobbit: An Unexpected Journey doesn’t open in North American movie theaters until December 14th. But I’ve learned that tickets are going on sale more than a month in advance. The date is this Wednesday, November 7th, online and in theaters across North America at 12:00 PM Eastern Time. ”We’re expecting a big result as we start the journey for all 3 films,” a Warner Bros exec tells me. To ‘event-ize’ the release, moviegoers will be able to return to Middle-earth at marathon screenings of Jackson’s The Lord Of The Rings Trilogy in Extended Cut editions on Saturday, December 8th, and Sunday December 9th. Tickets for these all-day events also will go on sale online and in theaters throughout the U.S. at Noon ET on Wednesday November 7th.
The Hobbit: An Unexpected Journey will be followed by the second film The Hobbit: The Desolation of Smaug releasing December 13, 2013, and the third film, The Hobbit: There and Back Again slated for July 18, 2014. All 3 films are productions of New Line Cinema and MGM Pictures, with New Line managing production and Warner Bros Pictures handling worldwide theatrical distribution. Select international territories as well as all international television distribution is being handled by MGM. Under Jackson’s direction, The Hobbit Trilogy has been shot in 3D 48 frames-per-second and will be released in High Frame Rate 3D (HFR 3D), other 3D formats, IMAX and 2D. These adaptations of J.R.R. Tolkien’s classic novels tell the continuous story set in Middle-earth 60 years before The Lord Of The Rings, which Jackson and his filmmaking team brought to the big screen and won the Best Picture Oscar for The Return of the King.
Several of the characters return