Is the Age of the $1 Billion Blockbuster Over?

"Even in the best of times, it's tough," one analyst says. The experts weigh in.

2021 Box Office HBO Max Universal Disney
The film industry is faced with a new normal at the box office. Courtesy of Warner Bros. Pictures and Legendary Pictures

From 1997-2008, just four films managed to surpass the vaunted $1 billion mark at the worldwide box office in unadjusted gross: TitanicLord of the Ring: The Return of the KingPirates of the Caribbean: Dead Man’s Chest, and The Dark Knight. The $1 billion benchmark was long considered the gold standard in contemporary Hollywood box office, an elite club for the film industry’s most exclusive successes. But thanks to changing viewing habits, an avalanche of $100 million-plus tentpoles, and a new emphasis on franchises over the last 12 years, 39 additional movies have hit that mark. What was once nigh-impossible suddenly became somewhat frequent.

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Yet with the coronavirus pandemic expediting the transition from legacy and linear entertainment to direct to consumer, it’s fair to wonder if the age of the frequent $1 billion blockbuster might be nearing its end. Universal Pictures signed historic window-shattering deals with major exhibitors to bring films to PVOD sooner than ever, Disney has sent blockbusters such as Mulan and Soul to Disney+ and is expected to reroute more film to their streaming services, and Warner Bros.’ made the unprecedented decision to open its entire 2021 theatrical slate day-and-date on HBO Max. While there’s no guarantee these shifts will extend beyond 2021, it’s mighty difficult to put the genie back in the bottle.

Here’s what our panel of box office experts believes when it comes to the prospective $1 billion success of future blockbusters.

$1 billion movies box office
43 films have surpassed $1 billion at the worldwide box office. Comscore

Jeff Bock, Senior Box Office Analyst at Exhibitor Relations

Bock has long been a proponent of studios prioritizing their direct-to-consumer platforms in the midst of the recent increased competition in the streaming industry. Given the landscape changes, he sees the $1 billion marker once again becoming rarefied air. More importantly, he’s curious how major studios without powerful in-house streamers will survive.

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“That $1 billion box office threshold won’t be crossed anytime soon unless foreign markets will it to do so,” Bock said. “Maybe F9, Avatar 2—those films might have a chance as long as the virus has been snuffed out. Until then, it’s going to be all about subscriptions. What’s really interesting to me is where is the safety net for Paramount (PARA) and Sony? Will be very keen to watch that parallel drama unfold.”

As we explored last week, Sony doesn’t have a streaming service and is therefore positioned as the short-term free agent king of licensing revenue but faces an uncertain future long-term. Paramount has CBS All Access, which will become Paramount+ in 2021, but the comparatively smaller service can’t generate enough subscription revenue yet to justify putting a blockbuster feature on it.

Paul Dergarabedian, Senior Media Analyst at Comscore

Despite the increase of $1 billion movies over the last decade, just north of three films per year have managed to hit the mark since 2008.

“To get to $1 billion requires that the engine is operating on all cylinders. Everything has to be working perfectly,” Dergarabedian said. “Even in the best of times, it’s tough.”

Dergarabedian points out that just last year, most theaters were operating at 50% capacity mid-week, making the limited capacity restrictions in the pandemic not entirely different from normal business. The bigger issue, he argues, is the number of theaters available. Big blockbuster traditionally open on more than 4,000 theaters in the U.S. Right now, roughly 37% of American theaters are open.

“It’s definitely going to be a challenge to get to those big numbers and it’s going to be awhile before a film can do that again,” he said. “But it’s not a matter of if, but when. F9No Time to Die—films such as those that rely on more international revenue have a chance. Then again, we have to see what the marketplace looks like. It might not be a 2021 movie at all.”

Dergarabedian observes that it wasn’t as if Disney+, Hulu, Amazon (AMZN) and Netflix (NFLX) weren’t already a huge force in 2019, yet the film industry simultaneously saw its biggest box office year globally ($42.5 billion) while Avengers: Endgame broke records. “It’s not so much that we are going to have more streaming moving forward, but that the bigger content will be available at home much sooner. The question is: what are the consumers going to do with that?”

Shawn Robbins, Chief Analyst at Box Office Pro

Robbins caveats his analysis with the acknowledgment that this is long-term speculation based on short-term announcements that we have yet to fully see in action. But he sees recent shakeups in the film industry as placing an even greater emphasis on overseas ticket sales.

“What I would say for now is that the international market has been such a consistent point of growth for theatrical box office that we might still see consistent $1 billion grossers in the years to come after ‘normal’ life has resumed and even with shorter theatrical windows,” Robbins told Observer. “If anything, the stronger theatrical recovery in some markets during the pandemic provided a blueprint for what kind of moviegoing demand there may be here at home on the other side of this health crisis.”

He continued: “To that end, with shortening windows in the equation domestically and the lack of streaming platform deals or availability outside domestic borders, the overseas landscape remains vital for studios’ most lucrative films—perhaps even more so if shortened windows become the norm. The downside here is a sharply higher risk of piracy for any high profile film offered as an early digital release in major markets.”

Is the Age of the $1 Billion Blockbuster Over?