Hollywood Back on the Big Franchise Hunt

With Warner Brothers' Harry Potter and the Order of the Phoenix opening tomorrow in an estimated 4100 theaters, the Hollywood Reporter decided to check the overall health of the franchise business. And the current prognosis is that Hollywood is at a turning point. Many of the tentpoles that have made fortunes in past years are aging or are now financially top-heavy from back-end talent deals. The studios are well aware of this and are doing their best to keep their franchises going by any means available--Sony is trying to get the talent on board for a Spider-Man 4 and Disney's hopeful that Johnny Depp will agree to star in a fourth Pirates. WB's Harry Potter is probably in the best shape, but it's set to conclude after two more pictures. However, it's clear why franchises are still the main focus of big Hollywood business: according to a recent report by the MPAA, theatrical box office now accounts for only 19% of a movie's total revenue. So Spider-Man, Pirates or Harry Potter may make hundreds of millions theatrically, but they mean billions in overall revenue.

"(Franchises) are critically important, more so now than ever," says Hutch Parker, vice chairman of 20th Century Fox Film Group. "In a market that is getting increasingly cluttered with third-party productions -- often financed by hedge funds and other sources of financing -- franchise pictures cut through the clutter, courtesy of their unique relationship to the audience, and have a currency around the world that very few other kinds of pictures do."

While all the studios have their big money makers, looking forward, Paramount seems to have the slate with the strongest franchise potential.

DreamWorks Animation is under way with a fourth film in its "Shrek" series for distributor Paramount, and Paramount is reaching even further back with a new installment in its landmark "Indiana Jones" franchise set for release next year. The studio also is embarking on a new "Star Trek" film with J.J. Abrams directing, and there is plenty of speculation that "Transformers" might become a vibrant new franchise for the studio based on its boxoffice take this past week.