Last Friday, DreamWorks Animation and Universal Pictures made Trolls World Tour the first new big-budget film to debut exclusively on at-home video-on-demand platforms as the coronavirus pandemic has kept movie theater chains closed for weeks. During this outbreak, Universal has been the boldest major studio when it comes to experimenting with at-home releases and shortening the theatrical window. While we shouldn’t expect any blockbuster films such as F9 (delayed until 2021) or Wonder Woman 1984 (delayed until August) to follow suit anytime soon, Trolls World Tour does mark a major first for the industry.
The 2016 original, Trolls, cost $125 million to make and opened to $46.5 million en route to nearly $347 million worldwide. It’s far from an apples to apples comparison given the convenience of at-home viewing and the global extenuating circumstances, but Trolls World Tour reportedly opened to around $50 million via its premium video on demand opening weekend. That’s a win any way you slice it. But Mark Zoradi, CEO of Cinemark, the country’s third largest theater chain, doesn’t foresee the success producing any real ripple effects on the industry.
“Universal came out very clearly and made the decision when we were closing our theaters. They felt like they spent so much in marketing money and putting commitments like McDonald’s, that they had no choice. We don’t see any systemic change from all major studios when it comes to their major motion pictures because theatrical is so important to them,” he said, per Deadline.
The largest pay-per-view event in history was the 2015 championship boxing match between Floyd Mayweather Jr. and Manny Pacquiao. That fight collected 4.4 million buys at $90 a pop en route to more than $400 million in revenue. For a film like Trolls World Tour selling for $20 per buy, the at-home sales might be comparable to a traditional theatrical run. But for a major blockbuster such as MGM’s No Time to Die or Marvel’s Black Widow, both of which could threaten the $1 billion mark, an at-home release doesn’t make much financial sense. Movie theater ticket sales account for roughly 54 percent of a studio’s revenue, according to Zoradi.
Studios may see the early success of Trolls and opt to re-route more applicable titles—mid-budget dramas and comedies, family friendly fare, etc.—to streaming and VOD during heightened times of self-isolation. But Zorardi insists that most major studios are “anxious to get back in this business once safety is no longer a concern.” He acknowledges that a warm-up period is expected in which audiences take their time regaining trust and confidence in public health and safety. Foot traffic isn’t going to automatically return to normal. But studios seem willing to take the short-term losses on their tentpoles in order to take advantage of the traditional profit opportunities that accompany blockbusters: theatrical release, electronic sell-through (EST), DVD/VOD rental, Pay One, Network, Pay Two.
Trolls World Tour is an unexpected success and Universal deserves credit for their creativity. But, for now, it’s an isolated victory and not the start of a new Hollywood trend.