Wednesday, January 31, 2024

Willy Wonka and the money-printing machine

[more January IP blogging]

I noticed this box of cereal the other day while shopping. My first thought was they are still squeezing money out of a 50 year old film and the image of a star who has been dead since 2016


 [Next to a box of cereal featuring sixty year old cartoon characters, but that's a topic for another post.]

The example was even more striking after I did a little research. This wasn't just a fifty-year-old film; it was a fifty-year-old flop.


The idea for adapting the book into a film came about when director Mel Stuart's ten-year-old daughter read the book and asked her father to make a film out of it, with "Uncle Dave" (producer David L. Wolper, who was not related to the Stuarts) producing it. Stuart showed the book to Wolper, who happened to be in the midst of talks with the Quaker Oats Company regarding a vehicle to introduce a new candy bar from its Chicago-based Breaker Confections subsidiary (since renamed the Willy Wonka Candy Company and sold to Nestlé). Wolper persuaded the company, which had no previous experience in the film industry, to buy the rights to the book and finance the picture for the purpose of promoting a new Quaker Oats "Wonka Bar".


Willy Wonka & the Chocolate Factory remained in obscurity in the years immediately following its original release. When the distribution rights lapsed in 1977, Paramount declined to renew, considering it not viable. The rights defaulted back to the Quaker Oats Company, which was no longer involved in the film business, and therefore sold them to Warner Bros. for $500,000. Wolper engineered the rights sale to Warner, where he became a corporate director after selling his production company to it the previous year.

By the 1980s, the film had experienced an increase in popularity due to repeated television broadcasts, and gained cult status with a new audience in home video sales. In 1996, there was a 25th anniversary theatrical re-release which grossed the film a further $21 million. In 2003, Entertainment Weekly ranked it 25th in the "Top 50 Cult Movies" of all time. The tunnel scene during the boat ride has been cited as one of the scariest in a film for children, for its surreal visuals, and was ranked No. 74 on Bravo's The 100 Scariest Movie Moments. The scene has also been interpreted as a psychedelic trip, though director Stuart denied that was his intention.


Willy Wonka & the Chocolate Factory was released by Paramount Pictures on June 30, 1971. The film was not a big success, eventually earning $4 million worldwide on a budget of $3 million, and was the 24th highest-grossing film of the year in North America.

A few important points here both about the business of entertainment and about why most of the coverage of that business is so bad.

First off, every story of this industry is an IP story, both in who owns it and the curve of its money-making potential. Warner picked up the rights to this film for what was, even at the time, a song. Since then it has grown far more profitable and, to point out the obvious, that's all gravy. You don't need to spend any money on production or acquiring rights and, in a sense, its advertising budget is negative since you get paid for product placements to keep it in the public eye.

As we've discussed before, certain intellectual property has legs. It will continue to produce, often becoming even more popular, for decades after its creation. It is no coincidence that every few years armies of lobbyists from Disney and other big media companies descend upon Washington to get Congress to push back the expiration dates on copyrights.

Certain properties remain culturally relevant seemingly forever, and that relevance translates to multiple streams of revenue. They will be sold directly, remade or covered, streamed, licensed, and will serve as the basis for derivative works.

Universal's Frankenstein is over ninety years old and you will still see Jack Pierce's copyrighted makeup every Halloween. At the height of the pandemic, people watched over a billion hours of the  Andy Griffith Show, a series that ran from 1960 to 1968. Artists are constantly covering the songs of Hank Williams, a songwriter who died seventy years ago. Frankenstein, The Andy Griffith Show, and Hank Williams catalog were all enormously profitable at the time (Griffith was the number one show in the country the year it went off the air), but all ended up making far more money afterwards.

Looping back to the original subject, one place where one frequently finds IP with legs is the children's market. Kids are voracious consumers of media, have an extraordinary tolerance for repetition, and are frequently not all that discerning. Better yet, if your target audience is any age band Under 10, every few years it will completely refresh itself so you can just haul out the same old product. In one notorious example, Hanna-Barbera would crank out a single season of shows like The Jetsons, Johnny Quest, or Space Ghost and then run them in constant rotation on Saturday mornings for decades.

Television basically created the children's market, but it was home media that cranked it into high gear. I remember an interview with Robert Altman where the director of films like mash, McCabe and Mrs Miller, Nashville, and the Player said the film that had made him the most money was Popeye.

 Journalists covering the streaming industry, particularly East Coast based journalists, have done an embarrassingly bad job with the IP aspect of the industry, which is probably the single worst thing they could screw up. Disney and Warners lost billions saturating the market with expensive shows that provided little incremental value -- how many additional subscribers do you think the $150 to 200 million investment in Moon Knight brought in? - - while the majority of viewers were there for their already incredibly rich catalogs. At the same time, these journalists did a piss poor job reporting on which "Originals" Netflix actually owned the rights to and, perhaps more importantly, how few of the shows that they did on had any kind of legs.

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