Black Widow

Source: Disney / Marvel Studios

‘Black Widow’

Black Widow star Scarlett Johansson’s lawsuit against Disney has thrown Hollywood into a frenzy of speculation for a week and that will intensify the focus on the second-weekend box office performance of Jungle Cruise.

Like Black Widow, Jungle Cruise happens to be another Disney movie with a major female star – in this case Emily Blunt of A Quiet Place Part II, who appears opposite Dwayne Johnson yet according to reports has been paid less than half of what her co-star earned – that the studio released simultaneously in cinemas and on its burgeoning Disney+ Premier Access platform.

While there is no way to calculate a precise dollar amount of potential lost ticket sales due to a tentpole’s day-and-date launch on PVoD during a pandemic, few would disagree that the simultaneous release strategy impacts cinema-going.

Black Widow, which Disney announced this week had become the highest-grossing North American release during the pandemic on $169.7m, opened on $80m and earned $60m worldwide on Disney+ Premier Access. In the second weekend it tumbled 68% – the steepest drop by a Marvel Cinematic Universe (MCU) tentpole released by Disney after Ant-Man And The Wasp fell 62% in 2018 – and no further PVoD numbers were released.

Johansson argued in her filing that Disney interfered with her contract with Marvel Studios and induced the latter to breach its contract by putting what she believed would be an exclusive theatrical release on to Disney+ Premier Access, which cost her the upside from profit participation. (The platform’s subscribers must pay an additional $29.99 to watch the film on Premier Access.)

It is unprecedented for an A-lister to challenge a titan like Disney in this way. There will have been weeks of behind-the-scenes negotiations between the parties before it came to this and Johansson felt compelled to act.

What does it mean for others in her position? One report claimed Emma Stone is weighing up her options after Disney’s day-and-date tentpole Cruella capitulated at the box office in its second weekend at the start of the summer. There have also been rumblings about Blunt, although in her case much may depend on Jungle Cruise’s performance this weekend and the extent of its box-office drop. The adventure film opened last weekend on $35m and Disney said Disney+ Premier Access generated more than $30m worldwide.

Opening the floodgates?

Hollywood insiders are divided over whether Johansson’s legal filing – which prompted a barbed retort from Disney over her “callous” disregard for global effects of the pandemic and referenced her $20m Black Widow payday – will open the floodgates to a torrent of similar legal action.

“Johansson’s lawsuit against Disney is courageous and important, however, it’s not the most egregious example of what is happening with streaming windows,” notes producer, sales agent, lawyer and Cinetic founder John Sloss. “[WarnerMedia CEO] Jason Kilar’s decision to move the entire Warner Brothers slate to a day-and-date release on HBO Max was a brazen move as it was a clear play to dedicate resources to increase subscribers.

“I believe that in this case, Disney made a financial decision, at least in part, to optimise revenue from Black Widow versus focusing solely on increasing its subscriber base. I think there is a large distinction between the two.”

Warner Bros faced a huge backlash after its HBO Max announcement late last year, sparking ire from prestigious collaborators like Christopher Nolan and Denis Villeneuve, whose Dune will open Venice Film Festival in September. The studio set about making amends by cutting deals with key talent. Kilar has said Warner Bros movies will go back to exclusive – albeit shorter – theatrical releases in 2022 and by and large the outrage has died down.

Whether Disney will countenance make-good arrangements with talent whose movies open day-and-date remains to be seen – so far, nothing concrete has been reported.

CEO Bob Chapek has intimated in the past year that the company is approaching distribution during Covid on a case-by-case basis and must protect its film assets when cinema-going has taken a huge hit and hesitancy remains high.

He is also gung-ho about Disney+ and reorganised the studio’s activity around the platform. Wall Street likes that the streaming model gives consumers a choice and shareholders have also benefited. Since launch in November 2019, global subscribers have crossed 100 million and Disney’s valuation has soared to $320bn.

But what happens to the back-end deal, where first-dollar gross participants have reaped the rewards of mighty box office performance? Firstly, sources say, very few stars in the Hollywood firmament actually benefit from these deals in a considerable way. Secondly, Hollywood has been moving to abolish profit participation ever since Netflix started buying out talent with lucrative upfront payments.

“Talent has been forced for a while to try to get as much upfront as possible, which ultimately creates this cycle where budgets are driven up and the risk of investing goes up, making it in some cases the only viable model to obtaining financing,” says Labid Aziz, head of film and TV production company PoC Studios in Los Angeles. “This ultimately commoditises content which is something I don’t think any of us want.”

Disney and other media behemoths might disagree. At a time of consolidation – Discovery/WarnerMedia and Amazon/MGM being two pertinent, recent examples – some argue the cards will be stacked in Disney’s favour as less competition makes it harder for talent to ask for more money. Furthermore, how can talent hold on to back-end deals at a time when movies are migrating to digital platforms faster than ever and the 90-day exclusive theatrical window has been whittled down to 45 in the space of 18 months?

“We’ll see what happens when theatrical comes back,” says Sloss, who agrees that the 90-day theatrical window is dead (“you can’t put that genie back in the bottle”).

On upfront deals, he says, “It’s entirely possible for these types of negotiations to become the norm as streaming services become the place where the most consumption occurs. Netflix is a great example of this – there was no waterfall, no revenue stream to participate in, the talent who work with Netflix have routinely done it for more money and understand that it is a buyout.”

“Gendered character attack”

After Disney revealed Johansson’s salary on Black Widow, Women In Film, ReFrame and Time’s Up accused the studio of a “gendered character attack” in which “women and girls are perceived as less able than men to protect their own interests without facing ad hominem criticism”. On Friday (August 6), SAG-AFTRA president Gabrielle Carteris took the studio to task in the media for ”gender-shaming and bullying”, adding: “Actors must be compensated for their work according to their contracts… Nobody in any field of work should fall victim to surprise reductions in expected compensation. It is unreasonable and unjust.”

However, the lawsuit also points to a broader clash between the old and new culture of the entertainment business. When Johansson’s agent, CAA co-chair Bryan Lourd, spoke out in defence of his client, it marked another unusual move. Insiders note he is protecting the honour of a beloved actor but also the value of an A-list asset that brings the agency bags of money in fees and commissions.

How much does Disney care about the negative publicity around the Johansson fracas? The actress’ legal action has surely burned bridges with the studio and, after years of Marvel films, it remains to be seen whether she works there again. She has already stated that she has no plans to return as Natasha Romanoff, the character she plays in Black Widow who has also graced a number of other MCU tentpoles – helping to earn Disney huge profits along the way.

Far more important for the studio is keeping Marvel Studios head Kevin Feige on-side. Feige is reportedly upset by the furore and is said to have preferred a pure theatrical release for Black Widow before it transitioned to Disney+.

While media analysts have noted that former Disney CEO Bob Iger would never have allowed an altercation with talent to reach the point where a star sued the studio, the fact that talks between Disney and Johansson broke down speaks to the changing times.

Some insiders who spoke to Screen said that Hollywood’s self-absorption and the agencies’ own lucrative engagement with traditional talent deals has created a myopia that is out of synch with new realities. Streaming platforms and the studios that have been pouring money into building their own direct-to-consumer services know that fans’ only concern is about choice – being able to consume content when and how they want.

“Consumers may not have much sympathy for a star who’s already getting paid $20m for the movie and is taking that choice [in how they watch the film] away from them,” says one. “How do you tell a consumer during a pandemic that they can’t see a movie because the star doesn’t think they’ve made enough money in their deal and the consumer has to risk going to a theatre?”

A growing cohort of industry professionals believe the up-front deal structure will become more common. PoC’s Aziz believes that if the major streaming and studio content creators invest more in the value of intellectual property at the expense of star power, it could have a benefit for others in the business.

“They may say they’re going to bet on the IP. Do we want that to happen? Of course not. But if they do, it may present an amazing opportunity for the independent world,” he says. “It could open a door for us in the independent space to work in a truly collaborative way with the talent and create some real and sustainable strategies around financing and producing excellent content which are designed for profitability.”

Hollywood will be watching closely to see if Stone, Blunt – who coincidentally was offered the role of Black Widow before it went to Johansson – or another star steps forward and cries foul over compensation related to day-and-date releases.

“If Johansson loses, talent will continue to negotiate maximum up-front and deal with the studios like they deal with streamers,” notes one entertainment lawyer who works regularly with studios like Disney and streaming platforms. “If she wins, it would be a paradigm shift.”