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Financing Formulas: The Sequel

'Friday' became a sleeper hit on video. Its planned follow-up provides a model for controlling the spiraling costs of franchises.

November 15, 1998|PATRICK GOLDSTEIN | Patrick Goldstein is a Times staff writer

When a movie like "Rush Hour" or "Mission: Impossible" blasts off at the box office, it doesn't take a rocket scientist to predict that it's only a matter of time before a sequel is on its way. On the other hand, it would be hard to imagine a more unlikely candidate for sequelization than "Friday," a 1995 New Line comedy starring hip-hop star Ice Cube and a then-little-known comic named Chris Tucker.

But New Line's plans to create a low-budget sequel offer a striking example of the changing economics of the movie business, especially in the realm of youth-oriented urban films. Released with little fanfare, "Friday" received scant press attention and made a modest $27 million in its theatrical release, barely what a blockbuster grosses in an opening weekend. But the film only cost $4 million, so much of that $27 million was profit.

What made "Friday" different was that it became a hit in home video, not at the theaters. New Line Home Video chief Steve Einhorn says that when he would interview college-aged kids for entry-level jobs or internships, he'd ask what videos they'd been watching. The most frequent reply: "Friday."

"Friday" has been on the video bestseller list for an astounding 98 straight weeks--only "Braveheart" has ridden the video charts longer. Released in October 1995, it has sold more than 600,000 units. The movie's soundtrack album is still selling 2,000 copies a week, having topped 2.2 million in sales overall.

" 'Friday' is the 'Titanic' of urban videos," says Einhorn. "With most urban movies, we're happy to sell 200,000 units. I don't think there's ever been another movie in the genre to compare to this."

After Einhorn ran those numbers by New Line Productions chief Mike De Luca this spring, De Luca promptly signed up Ice Cube to write and produce "Next Friday," which is due to start filming in February for an October 1999 release.

The movie's home-video success has spotlighted one of the hidden dilemmas of modern-day Hollywood marketing: Youth-oriented black films perform significantly better in home video than in theatrical release. After a series of widely publicized violent incidents at movie theaters showing urban films in the mid-1990s, white moviegoers stopped going to movies that attracted a predominantly black audience. In 1991, before the violent incidents began, "Boyz N the Hood" made nearly $65 million. But recently, even the most popular youth-oriented black films have topped out at around $35 million.

Movie marketers say the difference is largely due to the inability of black films to attract a substantial white audience. Ice Cube says he meets young white "Friday" fans all the time, but none of them had seen the film until it was released on video. "The violence in the theaters just made people back off," says Cube. "People feel safer waiting to see the movie on video." (Earlier this month, the Magic Johnson Theatres in Baldwin Hills refused to show the urban action drama "Belly" because of its potential for violence).

Despite "Friday's" continued popularity, a sequel would still have trouble breaking this box-office ceiling, especially if Tucker doesn't return in a co-starring role. So New Line is determined to make the sequel on a non-sequel budget, using a game plan that offers an intriguing lesson in sequel economics.

Under normal circumstances, if a studio wants to transform a hit into a franchise film, as Warner Bros. did with "Lethal Weapon" or 20th Century Fox did with "Die Hard," it needs to reassemble the original creative team, who use their bargaining leverage to win steep pay raises and rich gross participation deals from the studio.

To make "Lethal Weapon 4," for example, Warners had to pay Mel Gibson $20 million, plus 20% of the studio's gross earnings, while also giving substantial gross participation to director Richard Donner and producer Joel Silver. The film was estimated to have cost upward of $130 million--and it made about that domestically at the box office.

When salaries go up, budgets skyrocket. "Babe," a surprise hit for Universal in 1995, cost less than $30 million. Its sequel, due this Thanksgiving, is budgeted at nearly $85 million. The original "Speed" cost $30 million and was a sleeper hit. The sequel, "Speed 2," cost $110 million and was a costly failure.

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Some sequel packages are so prohibitively expensive that they haven't made it off the launch pad. Although Sony Pictures has been eager to reprise "Men in Black," the studio has been unable to find an equation that would satisfy the film's principals, who could end up with $50 million in salaries and 50% of the film's first-dollar grosses. As studio chief John Calley said earlier this year: "When you give the talent what they want, there's nothing left for the studio."

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