Will Lionsgate Be the Next Studio to Kick the Bucket?
Although I don't usually dabble in the financial and investing side of Hollywood, I came across a very interesting story today courtesy of The Big Picture. Apparently the investing bank Caris & Co. recently downgraded the shares of Lionsgate Entertainment (stock symbol LGF) to "above average" from "buy" based on early reports of the poor performance of The Spirit. We're not going to go into the investing side of things, but the most interesting observation is that the analyst for Caris & Co. stated that "the future health of the studio might well be tied to its January 16, 2009 release of My Bloody Valentine 3-D."
Now let's get things straight -- this all pretty much pure speculation, because that statement about Lionsgate's future health is only fodder for this discussion. However, with a quick look at Lionsgate's recent releases, it's obvious they've had quite a few flops. Both The Spirit (currently at $12.5 million) and Punisher: War Zone ($8 million) did much worse than they were hoping they would. Even Oliver Stone's W. did a lot worse than expected -- it's at $25.5 million with a $25.1 million budget. And dare I mention Transporter 3 ($31.6 million), My Best Friend's Girl ($19.2 million), or Bangkok Dangerous ($15.3 million).
There once was a time when Lionsgate was on the rise as one of the best independent studios around. Their success was (and still is) fueled by the Saw franchise and other random hits (like Fahrenheit 9/11 and Crash). Then some exec decided that they didn't want to be seen as the "horror studio" anymore, so they tried to branch out and find a wider variety of films, but more often than not they come up with duds. Now it's ironic that they're striving on very demographic-specific franchises again, like Tyler Perry movies (e.g. Meet the Browns and The Family That Preys this year) and an never-ending supply of Saw movies.
I find it incredibly coincidental that when I start noticing publicity problems (e.g. they hardly give any interviews and are hard to get in touch with), it's right when a studio is on the downfall and in need of some good publicity. And now they're banking their success on a gimmicky 3-D horror remake? No wonder they're promoting My Bloody Valentine 3-D everywhere you look on the internet. It could work, because American audiences are very easily persuaded to spend (extra) money on cheap, gimmicky 3-D cinematic entertainment. The budget is only $20 million, so it shouldn't be too hard to make a profit, right?
In a previous, and more cheerful interview with the NY Times, Lionsgate's co-chief operating officer Joe Drake said of My Bloody Valentine 3-D: "We see 3-D horror as financially lucrative and creatively exciting. We want to break some new ground here in R-rated fare." Only time will tell (14 days to be exact) if it's as "financially lucrative" as they're hoping. If it isn't, we might have the next New Line Cinema -- a studio that collapsed in 2008 due to, among other things, inexplicably awful marketing. The Golden Compass was the movie that finally killed them. Is The Spirit what finally kills Lionsgate? I doubt it.