Productions are always high-risk gambles. TV and film productions have high budgets with the potential of little return. IMAX has learned this the hard way, as their first venture into original productions, Marvel’s Inhumans, did not pay off the way they were hoping for it to. After having screened various TV shows, such as Game of Thrones, in their theatres, it did seem like the next step.
Yet, after negative reviews and an underperforming weekend at the Box Office, IMAX had to write down $11.1 million from its investments in the project. The company certainly did not profit from the project, but even with this write-down, the company’s overall stock seems to be rising. It was difficult for the company to truly profit off of this project, as they paid for the screenings, most of the production and marketing. Their only true income would be from the Box Office and any income shares they had with ABC. It highlights that this was more a “first mover” project for the company that would help them uncover a better source of revenue when it comes to these types of investments. It seems that they are considering focusing on liscencing to lower their own risk in these matters and raise the overall income.
Chief Executive Richard Gelfond also shared some news on how they will handle future projects.
“Going forward, we intend to take a more conservative approach consistent with the Game of Thrones approach to capital investments and content. We will be more conservative when considering whether to invest our own capital; and if so, to what extent.”
This certainly points to IMAX pulling back their funding in case the show would be renewed by Marvel or ABC. While some would point to the quality of the show being the main reason, there are more pressing issues that backfired for all companies involved. Production was heavily rushed to not only have a ready pilot to show to Executives of ABC but also that effects work would be done in time for a set date from IMAX. At the same time, the show had to continue work on the other six episodes and the first two needed to be cut for the theatrical release. As Gelfond points out, people expect a certain cinematic quality of anything released in cinemas with the Marvel banner attached.
“We believe one of the biggest contributors to the less-than-forecasted theatrical performance was a misalignment of customer expectations. Customers expected a production akin to a mega-budget blockbuster movie, rather than pilots for a television show. Moreover, the fact that this was Marvel IP set the bar at a level you wouldn’t see from other pieces of content or IP because of the reputation and the high production value of Marvel movies.”
Inhumans was a bit doomed from the beginning. It is a property that could work quite well on TV or in an episodic format, but it was not given enough time or care. Marvel TV has shown that they do value their shows and do not always rush things out, such as John Ridley‘s long-time work on his still still-unnamed show. It was in a similar situation as Iron Fist was on Netflix, as they had a deal that forced their hand and rushed their productions to meet their set deadlines. This is even highlighted by Scott Buck‘s involvement with both projects, as he has a reputation for handling these types of projects. Going by the Executives statement, it almost seemed that if they invested a bit more time and money, their project could have panned out better.
In reality, these kinds of failed deals are not uncommon. Many companies try out new projects to expand their own catalog. Microsoft tried to compete with Apple with the Zune at one point but was never able to survive in the market. It is a learning curve that companies must go through. This would also help Marvel TV to clearly define their strategies when it comes to making deals and cooperations.
What do you think? Could we see IMAX try their hand at such a project in the future again?