WWE Studios doesn’t want to become a remake of “The Money Pit,” where Tom Hanks and Shelley Long played a couple that plowed cash into renovating a dilapidated house. So the division is changing its own script in several major ways, according to Michael Luisi, president of WWE Studios.
WWE no longer will go it alone when producing movies, but instead has taken steps to spread the risk and reduce its financial exposure. These include:
■ Co-financing movies with other producers and trying to recover some of its investment through such avenues as foreign pre-sales. WWE is working with established producers such as 20th Century Fox, Anchor Bay, Lionsgate and others.
■ Working with existing distributors to help circulate its movies worldwide.
■ At times, buying completed films that lack any WWE stars and co-branding them with WWE Studios. The first such
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“The Day” is among the movies WWE Studios will release this year.
Photo by: WWE |
movie is “The Day,” a post-apocalyptic film that WWE bought, working with Anchor Bay, at the Toronto International Film Festival.
■ Concentrating on producing more PG-13 and R-rated movies in the genres of action, horror, thriller, science fiction and comedy, believing they hold more TV and international appeal. And its talent may not necessarily play the leads but take secondary roles instead.
“The ongoing evolution is continuing to partner with what we consider to be some of the finest producers and distributors in the business,” said Luisi, who assumed his post in September 2011. “That allows us to participate in material not only that we’re developing, but that they’re developing. Part of the strategy is definitely to have a broader portfolio of movies, more at-bats in terms of the number of pictures, and to lower the investment risk in the pictures as well.”
WWE Films began in 2002. It sunk about $100 million into its first six films, including the popular “The Marine,” with John Cena as lead, and “See No Evil,” which starred Glenn Jacobs, who performs as Kane in the WWE. WWE said that, combined, those movies will “generate a modest, single-digit rate of return.”
The second phase of WWE Films began in September 2010 and the unit spent about $40 million producing eight films, including the comedy “Knucklehead” and “Legendary.” WWE said those films are expected to generate losses.
Now, WWE Studios enters phase three under the new operating model, with plans to invest between $15 million and $25 million in 2012.
The company’s latest earnings report shows the challenge ahead. Exact numbers are difficult to pin down because of complicated sales and distribution deals, but for the quarter ended March 31, WWE Studios had a loss of $1.3 million — still, an improvement over a loss of $4.1 million in the year-ago period.
The WWE’s Big Show (Paul Wight Jr.) starred in “Knucklehead” and likes the company’s new business model.
“I think it’s a great platform for WWE studios to build itself. To come out with a fledgling studio and compete with massive studios is a big, bold beginning,” Wight said. “Or taking films already completed, where a multimedia conglomerate can help facilitate a good relationship with getting the movie out, and help build the studio and name in the industry.”
Bruce Goldberg writes for the Denver Business Journal, an affiliated publication.
