Mr Cunningham Will See You Now…
If last year’s performance is what Universal can do in a relatively quiet year – 2014 saw impressive numbers at the box office and particularly on home entertainment, without a real tentpole film to hold its schedule up – then imagine what it can do when it has a phenomenal slate.
And what a slate Universal has for 2015, which is shaping up to be the studio’s biggest ever in its 100 year plus history.
It’s already got off to a flying start both in stores and at cinemas, with Fifty Shades Of Grey enjoying a spankingly good box office run ($560 million in worldwide revenues and counting, one of Universal’s biggest ever releases) and its slate just keeps giving.
As if that wasn’t enough, here in the UK, the company has its homegrown special interest slate, breathing new life into the fitness market and continuing to enjoy notable successes in comedy and elsewhere too – this year sees one of its biggest stars returning to the fray too. There’s also its impressive local acquisitions, homegrown and non-studio films from elsewhere, which, with 2014’s Northern Soul blazing a trail, is starting to prove fruitful both artistically and commercially too. Let’s not forget that Mrs Brown’s Boys, one of 2014’s most profitable releases, was a local acquisition too.
If anyone is ideally placed to oversee the major’s 2015 from a home entertainment perspective, then it’s worldwide home entertainment president Eddie Cunningham. Now firmly ensconced in Los Angeles, he’s gone from UK retail – another former Woolies boy done good – through the ranks at PolyGram and then Universal to overseeing its global operations. He knows our business inside out, offering up a unique perspective on where the UK fits into Universal’s worldwide thinking.
“We obviously try to produce a balanced slate every year, high-profile studio films complemented by our local acquisitions,” he says from the US in a wide-ranging interview with The Raygun, taking in both Universal’s 2014 achievements, its 2015 slate and beyond. “It would be fair to say that we started 2014 without an obvious tentpole on the slate, but with some potential breakout titles. Lucy ended up doing $458 million at the global box office, which was a huge success. The Wolf of Wall Street did exceptionally well as did Bad Neighbours, and we had several films that over-converted in the home entertainment window, like 47 Ronin and R.I.P.D. Our local acquisitions team was busy delivering big hits with Mrs. Brown’s Boys D’Movie, Lee Evans and what was a surprise hit to many with Northern Soul.
“In short, we made and acquired a lot of good films and that usually leads to success.”
Universal’s annus mirabilis has got off to a flying start too, as last year’s theatrical releases have performed admirably. “It’s been a great start to the year for us with a new release market share approaching 20 per cent,” Cunningham notes: “We had a solid video result on Lucy. Dracula Untold has significantly over performed. Boxtrolls has also done well for us, and award winners The Theory of Everything and Boyhood are shaping up well.”
The special interest sector has done admirably too:
“Our Charlotte Crosby release has rejuvenated the fitness sector and our sales on Barbie in the Princess Power have shown that this franchise continues to go from strength to strength.”
It’s in the theatrical area where the 2015 slate kicks off in earnest though, with 18-rated adaptation Fifty Shades Of Grey dominating the pack. Ad Cunningham says: “In the theatrical window, Fifty Shades of Grey has gone on to become one of Universal’s biggest releases of all time, with $560 million at the box office, and counting. The home entertainment release promises to be very special and will include, for example, an alternative ending.”
It’s a truism that you can judge a studio by how it works and does business when it’s not at the top of the curve in terms of blockbuster releases, and if that’s the case, then Universal is at the top of its game.
But as Cunningham notes, balance is crucial: “If you are a major studio, I think it’s important to aim to have a balanced slate every year. That means, hopefully, some tentpole movies, a number of mid-range movies, and some smaller ones that have breakout potential.”
Its slate in 2014 and into this year was aided no end by the quality of the films on offer, its awards-friendly slate giving it an extra sheen and boosting box office immeasurably. How important, The Raygun ventures, is it to have those breakout movies? “There’s no question that the publicity and prestige associated with critically acclaimed films invigorate global appetite for movies generally and help fuel consumer engagement in our category,” says Cunningham.
“Every film is different, they all need to be handled sensitively and individually. Some will be big blockbusters and some will be small. Some will be critically acclaimed and some won’t. Our job is to tell great stories and find an audience for each of them. Our success will partly be defined by the quality of those stories aside of the financial returns, so these award-winning films are an incredibly important part of the mix.”
Universal in 2015, especially as the year progresses, will be judged on how it manages to maximise revenues across the board from its blockbusters. “2015 is shaping up to be a year like no other in the studio’s storied history,” explains Cunningham. “We have come out of the gate charging and plan to maintain a vigorous pace right through to the year’s end.
We have quite a number of tentpole titles, starting with Fifty Shades of Grey (February 13), followed by Furious 7 (April 3) which is going to be bigger and more spectacular than ever. We then release Pitch Perfect 2 (May 15), which sees the original cast making their return. That is followed by Jurassic World (June 12), the original Jurassic Park film being Universal’s biggest of all time. We have Minions (June 26), an origin story based on the Despicable Me franchise and then the eagerly anticipated Ted 2 (July 10). Later in the year we have the Judd Apatow-directed comedy Trainwreck (August 28), Everest, produced by Working Title (October 2), and Crimson Peak, directed by Guillermo del Toro (October 16).”
In a year which, as he notes, is set to be the biggest ever, as well as offering up a wealth of eagerly awaited titles. what is Cunningham most looking forward to?
“It’s hard to pick a favourite from the slate but the Furious 7 release in April is particularly poignant for everyone at the studio after the untimely passing of Paul Walker. He was very much a part of the Universal family and is sadly missed. The film will honour his memory. I was a huge fan of the original Jurassic Park, so I’m especially looking forward to Jurassic World.
“Pitch Perfect was a big break-out hit a couple of years back and the sequel will be much bigger…it brings back the original cast and is such a feel-good film, with great repeat viewing potential, which is great for video.
“Oh, and you can never get too much of the Minions!”
Cunningham is still keeping a close eye on the UK, its local acquisitions, a concept he helped nurture while based in London, this too is coming good in 2015 and he proudly offers up some highlights.
“Our local acquisitions team have been busy again so watch out for our film Kurt Cobain, Montage of Heck, about the legendary Nirvana front man. Watch out too for Cop Car starring Kevin Bacon and the comedy-horror Cooties with Elijah Wood. For football fans everywhere, we have a great documentary film on European Footballer of the Year Christiano Ronaldo. We will also have our usual huge comedy slate in Q4, including Michael McIntyre.”
It’s interesting to discuss the local product with Cunningham. Despite now being based in LA, his grounding came in a studio that was managing films as well as comedy, fitness and more; picking up library s and catalogues for its assorted imprints. And he still keeps a close watch on it. “The local business continues to be a key focus for us and is complementary to the studio output. We are used to sales in different genres changing with consumer interests so there is nothing new there. For example, people write off the fitness genre every few years, only for it to bounce back when we generate great ideas for content and find titles that really resonate with consumers.”
What’s more, as Cunningham says, the studio will continue to invest. “The physical market is clearly under some pressure but the strength of our slate each year and the growing digital opportunity, means we can keep investing in great quality content. We will continue to promote new talent, innovate and explore new genres. Not everything will work, but if you don’t speculate you will never know where the next Lee Evans, Class of ‘92, Mrs. Brown’s Boys, or Northern Soul, will come from.”
Where Universal will excel is the fact that it’s offering up biggies outside of Q4 too. It’s already enjoyed hits in the first quarter at both theatrical and cinemas and the likes of Fifty Shades Of Grey – just announced as a June home entertainment release – and Furious 7 will land on DVD and Blu-ray outside of the final three months of the year. Stretching right back to his time at PolyGram before it was acquired by Universal, Cunningham has been a proponent of the year round business. “It’s no secret that Universal has often led the way in establishing a year-round release strategy. Although the summer will always be important for the theatrical business, and Q4 will always be critical for home entertainment due to the huge seasonal gift-buying opportunity, there is no longer a clearly defined seasonality associated with movie watching.
“On the home entertainment side, virtually every month can produce huge hits if we produce great films. It’s obviously much better for our retail partners too if we can keep consumer interest in the category all year round. It’s really all about maximising the potential of every film.”
Universal’s slate has just grown immeasurably too. Not long after discussions had started with Cunningham about the potential of doing an interview with The Raygun, the studio announced that it was entering into a partnership with Paramount which will see it looking after Paramount titles for the home entertainment sector in numerous territories starting with the UK. It would be remiss not to discuss it, even if many of the logistics are still being worked out.
“We are delighted to be partnering with Paramount internationally,” says Cunningham. “The UK will be the first of the major countries where we will join forces, starting this summer. We have worked with Paramount in a number of the smaller territories over the past few years and together have delivered really strong results where we have partnerships. It is a transformative time in home entertainment, and we hope to make the partnership in the UK, and elsewhere, a big win for Paramount, for Universal, for our retail partners and for movie consumers alike. We will work hard to make the transition as seamless as possible for our customers and aim to ensure we all benefit from this new collaboration.”
For Cunningham, the prospective relationship is, in some respects. like many of the relationships and partnerships it already enjoys. As Cunningham explained: “In the UK, we have worked hard over many years to make our partners successful, whether they be talent in the comedy, sport, music or fitness worlds, or Mattel with Barbie and now Monster High, in our UCA collaboration with Sony, in our non-traditional distribution partnerships with other Studios and Independents. We have always approached the business as every title – big or small – being really important and treating every partner’s release as our own and prioritising each is if it were our only title. That means focus and it means investment in resources and in marketing. I think we do this well which is why so many partners join us and why they keep returning with future projects.”
Just from a physical distribution standpoint, it means the sheer volume of titles being released by Universal will be fairly hefty. “I think everyone in distribution would prefer to have more content than less!” he says. “From a distribution perspective, the Paramount content is unquestionably a fantastic complement to our already incredible slate. What’s important is that UPHE already has a strong distribution infrastructure and good retail partnerships in place and that we continue to adapt to the changing needs of the business and our customers as we move forward.
Our teams will continue to try to find ways to innovate and work smarter to ensure we maximise the potential of each and every release through its lifecycle.”
Beyond Paramount, how do Universal and Cunningham view the state of the business? Cunningham believes it’s not just his studio’s slate that will boost trade in 2015, it’s everyone’s. And the raft of blockbuster after blockbuster releases coming to market this year will be crucial for the home entertainment sector.
“In the early part of the year the market has undoubtedly been a little soft in terms of new release, but I predict that this is going to be the biggest and best year ever for movies – across all studios.
“I’ve never seen so many tent-pole films slated in one year! The huge box office will create not only massive new release sales but huge opportunities to sell the earlier catalogue on all the big franchise titles.”
Cunningham’s perspective is unique in that he sees the business from a global viewpoint, but, given his background, he has a keen understanding of the local market on these shores.
“Globally, consumers continue to actively engage heavily in our category as technology advancements continue to create new digital opportunities,” he explains. “Consumers obviously have many more options these days so physical sales are now competing with the new ways to access content. The overall numbers for viewings are increasing and we are all on a journey of adjusting to technology and new business models. We need to keep innovating, experimenting and trying things, but within all this change, many consumers will still want to watch, own, or gift, content in a physical format. Our job is to make sure they can find this content and that we keep adjusting to their needs.”
And what of business over here? “The UK is the third biggest home entertainment market in the world, after the U.S. and Japan, so it is very important to us. We have some of the best retailers in the world in the U.K. and it’s great to see HMV back and growing alongside an incredibly strong supermarket sector and online specialists Amazon.
Consumers still love to buy, and touch, content and we are going to be selling physical product, in big numbers, for a very long time to come. As with all markets, however, we must continue to aggressively innovate to maintain consumer engagement in the home entertainment category.”
And despite inroads into technology, physical is still crucial and, as many industry analysts are noting, it’s not dropping off at the rate that many would have expected. “Consumer spending on physical discs has remained remarkably resilient in the face of the biggest technological disruption we have ever seen in our business,” he says. “While that change creates some challenges for us and our partners, you have to believe that technology will ultimately be the industry’s friend, opening up many new avenues for consumers. While physical has and will continue to face pressure from new technology, physical sales continue to be the biggest segment of our business. It would be hard to greenlight a movie without the contribution from Blu-ray and DVD.”
What, we venture by way of conclusion, about beyond 2015? What are the highlights we should be looking for beyond this year? Maybe we’re getting a bid ahead of ourselves.
“Although the studio is obviously working hard on the 2016 and 2017 slates, I would prefer to focus on 2015 for now as we have such a big year ahead of us, as has the industry in general,” he finishes. There is, however, one minor concession. “That said, everyone is incredibly excited about the next instalment of the Bourne Franchise, which sees the return of Matt Damon.
“But, for now, if we all get behind this year’s slate in a really big way, we will not only deliver huge results, but we will drive lots of consumers into retail stores for extra visits, which is great for everyone.”
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