A look at why ‘Resurgence’ bombed – STX looking to make its mark after ‘Jones’ flops

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LOS ANGELES, June 28, (RTRS): “Independence Day: Resurgence” didn’t set off any early fireworks at the US box office over the weekend. The sequel to the 1996 hit (the highest-grossing movie of its year) only opened with $41.6 million. To put things into perspective, the original “Independence Day” kicked off to $50.2 million, back when tickets were less than half of what they are priced at now. But executives at Fox might not be sweating too much, since “Resurgence” (which cost $165 million) did much better internationally with a tally of $102.1 million abroad. In China, it scored an impressive $37.3 million debut.

Still, it’s troubling for Hollywood that the sequel named after a patriotic summer holiday wouldn’t generate more interest among US ticket buyers. Here are three reasons why “Resurgence” suffered at home.

* The sequel needed Will Smith

The original “Independence Day” kicked off Smith’s career as a major box office draw, a status that he enjoyed for 15 years with mega hits such as the “Men in Black” series, “Hancock”, “I, Robot” and “The Pursuit of Happyness.” Smith bailed on “Resurgence” after the studio reportedly turned down his demand for a $50 million paycheck to crank out two sequels in a row. His casting would have inevitably fueled nostalgia among millennials who recalled seeing him in the first movie 20 years ago, even if Smith’s box office track record has been wobbly lately. On the other hand, adding Liam Hemsworth to the cast may have helped the movie’s international take — he’s Australian and global audiences are familiar with him from “The Hunger Games.” But in the United States, Liam and his older brother Chris (who plays Thor in the Marvel superhero movies) have been less successful at carrying movies on their own.

* Apocalypse Fatigue

When the original “Independence Day” opened, the idea of aliens blowing up the White House was a novel conceit. Now every blockbuster banks on apocalyptical themes. Just this year, the world was blown up in “Batman v Superman: Dawn of Justice” and “X-Men: Apocalypse” not to mention that director Roland Emmerich has turned mass devastation into part of his brand with projects like “The Day After Tomorrow” and “2012.” To US viewers still reeling from a national tragedy like the Orlando shooting, all this destruction might not still seem like escapist entertainment anymore.

* Audiences are getting smarter about sequels

With the quality of TV on the rise, audiences are showing a pushback this year against sequels that seem to only be made for financial gain. “Teenage Mutant Ninja Turtles: Out of the Shadows”, “Alice Through the Looking Glass” and “The Divergent Series: Allegiant” all underperformed badly after getting hit with negative reviews. Fox’s decision not to screen “Resurgence” early to critics was a sign that the tentpole was going to be a dud. As a result, most multiplex-goers splurged on “Finding Dory” instead.

Things didn’t go as planned with “Free State of Jones.”

The $50 million Civil War drama, greenlit two years ago by STX Entertainment, was meant to announce the indie studio as a bright new player bent on producing quality movies for adults with top talent. But, despite the presence of star Matthew McConaughey and director Gary Ross, and an extensive advertising push, “Free State of Jones” collapsed at the domestic box office this past weekend, eking out less than $8 million in its debut and raising more questions about STX’s business model.

STX got into the business precisely because it believes that there’s still an audience for the kind of projects major studios abandoned in favor of superhero adventures and tween franchises. The film, announced shortly after STX was launched in 2014 by Robert Simonds and TPG managing director Bill McGlashan, was handed a prime summer release date. Its failure underscores the difficulty of making movies of this size and ambition work at a time when Hollywood has gone franchise crazy. STX’s losses on the film will be somewhat mitigated by the fact that it brought in equity partners such as Huayi Brothers, Vendian Entertainment, Route One Entertainment, Union Investment Partners and IM Global, which handled foreign rights to the movie.

Differences

STX declined to comment for this report, but individuals close to the studio also note that there are structural differences at play that expose it to less risk when a film flops than its big studio competitors. STX executives say they have exponentially lower overhead to be covered, because its film unit operates with fewer than 100 employees. And sharing investment meant that on “Free State of Jones” the company was supposedly on the hook for less than $10 million of the production cost, though all of the marketing expenditures in the tens of millions.

“Free State of Jones” is the fifth release for STX, which needs more consistent winners at the box office. It turned a profit with the horror films “The Gift” and “The Boy” but flopped with the Julia Roberts thriller “The Secret in Their Eyes” and the point-of-view action film “Hardcore Henry” which rivals estimate lost between $10 million and $15 million. The results for “Hardcore Henry” shook STX brass, one insider claimed, because the company had landed global rights to the film out of the Toronto Film Festival after shelling out $10 million. It was a reminder of the financial perils that can come with making a false move.

The company hopes to be on firmer ground with that its other summer release, the R-rated comedy “Bad Moms.” In a sign that audiences are responding to its bawdy humor, an online trailer scored 80 million views in its first 11 days. The film got an enthusiastic reception when footage was screened at the exhibition industry conference, CinemaCon. On Monday, STX announced that it was moving “The Space Between Us” a sci-fi romance with Asa Butterfield from August to a December release, saying it was a better time of year to launch the film.

Still, STX remains a curiosity to Hollywood insiders. It’s not because its business plan is murky. The company has emphasized in press interviews and in presentations to exhibitors that it is not interested in making big-budget tentpole movies. Instead it has billed itself as a destination for the moderately priced comedies and dramas that once dominated studio slates. The company plans to release 12 to 15 movies annually by 2018, with budgets between $20 million and $80 million. The challenge of this strategy is that studios got out of the mid-range game for a reason — the risks aren’t as great, but the returns are far smaller.

“Part of getting it right requires having a lot of movies in the marketplace and for those movies to succeed”, said one insider. “If you want to get cynical, you get a $5 million profit here and maybe a $2 million profit there, and then there’s a $3 million loss on the other side. That all adds up to not a lot at the end of the year.”

The studio has a home-entertainment deal with Universal, but the company believes it can gain a competitive advantage over the major studios if it creates an inhouse digital strategy. With DVD revenue shrinking, the studio’s leadership is betting that it can corner the home entertainment audience by offering either a subscription-based Vevo-like streaming service or some type of over-the-top mobile app.

That will likely come through an acquisition, because creating a product from scratch would be time-consuming and costly. Simonds and STX president Sophie Watts have been meeting with technology companies in the US, India, and China as they plot how to build out the studio’s infrastructure.

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