Billion-Dollar Babies to Superhero Busts: 5 Lessons of the Summer Box Office

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After an ice-cold winter, receipts are up over 3% — and for the first time, three films crossed the $1 billion mark worldwide

Funny thing what three billion-dollar babies can do.

After a dire winter when the box office teetered more than 20 percent into the red, the movie business is hitting a high note midway through the summer.

"Transformers: Dark of the Moon," "Pirates of the Caribbean: On Stranger Tides" and "Harry Potter and the Deathly Hallows, Part 2"  each have hit $1 billion in worldwide box office, a record-setting sign of what happens when tentpoles work.

The domestic market is up about 3.3 percent over 2010 from the period starting in early May — the beginning of the summer season — through the end of July, according to Hollywood.com. For the year, the U.S. and Canadian box office is still off 5.7 percent — but hey, that's a heck of a lot better than where it was in March.

Also read: Why America Doesn't Count at the Box Office Anymore

The big story of the summer box office, of course, has been the explosive power of the foreign market. But not all is rosy; there are lessons to be learned from the new superhero franchises and the struggle to make 3D popular.

Here are five of them:

1. BIG GLOBAL FRANCHISES BECOME EVEN MORE IMPORTANT

It was the first summer in history in which three films reached a billion dollars globally.

The combined forces of the international box office expanded to reach new markets in Russia and China. And the plunging U.S. dollar grew foreign revenue and profits to record levels.

"It used to just be about domestic, but these days, if we can't get some sort of international buy-in, a project won't happen," one studio executive told TheWrap.

Domestically, audiences may have grown weary of aging franchises like Disney's "Pirates" — at $238.4 million, "On Stranger Tides" was the series' lowest-grossing title in the U.S. and Canada. But in era in which foreign box-office revenue has offset some of the lost revenue from the fading DVD market, "Pirates" is a treasure to behold.

Also read: Currency Woes – Why the Weak Dollar Is Helping — and Hurting — Hollywood

In far-flung places like Krasnodar, Russia — where some $200,000 worth of "On Stranger Tides" tickets were sold during opening weekend in late May — franchises with nine years of established brand equity, not to mention global stars like Johnny Depp, travel well.

2. THE SEQUEL WELL IS RUNNING DRY

J.K. Rowling has firmly stated the Potter franchise will end on the distinct high note of "Deathly Hallows"; filmmaker Michael Bay and actor Shia LaBeouf have said publicly that they're done with "Transformers"; Summit's hugely profitable "Twilight Saga" will end in 15 months.

Some of the biggest global franchises in the film business are going bye-bye. Problem is, this summer didn't exactly rain fresh global hits to replace them.

In terms of established franchises, Warner's "Hangover Part II" (a whopping $563.6 million worldwide) will certainly trigger more bouts of memory loss and low-grade nausea, and Universal's "Fast and Furious" will continue to prove that career criminals can cause millions of dollars in damage to public property and still be heroes! (A sixth movie in the series has already been greenlit after the fifth's $603.8 million global take.)

And there were several successful efforts that did spawn progeny: Marvel/Paramount's "Thor" ($447.8 million globally) and "Captain America: The First Avenger" ($190.3 million worldwide after two weeks) both will merit follow-ups; Universal's breakout chick-comedy hit "Bridesmaids" ($247.6 million on a $32.5 million budget) has gestated planty of follow-up talk; and you can prepare now for more of Sony's "Smurfs" after last weekend's big $35.6 million over-performance.

Also read: Another $1B Box Office Earner – 'Transformers 3' Makes the Mark

Also, based on the rave reviews that are coming in, Fox's four-decade-old "Planet of the Apes" series looks as vital as ever.

But is there a new billion dollar baby in the lot?

A studio distribution chief conceded to TheWrap that the market is in a bit of a drought.

"If franchises were easy to come by, then you'd be reading about 'Cowboys and Aliens 2,'" he said, noting the soft opening last weekend of the Jon Favreau-directed genre mash-up.

The good news, according to this executive: from MGM/Warner's Peter Jackson-helmed Hobbit series to Warner's Christopher Nolan-led Batman franchise, there are titles on the way that have billion-dollar potential.

3. EVEN SUPERHEROES NEED A STORYLINE

"The dissapointment of the summer was the comic-book films," said Jeff Bock, box-office analyst for Exhibitor Relations. "They didn't measure up to past films. It boils down to the difference between having ['Thor's'] Chris Hemsworth in the lead versus ['Iron Man's'] Robert Downey Jr."

Indeed, while "Thor" and "Captain America" were solid, and Fox's "X-Men: First Class" ($348.6 million worldwide) performed well enough to reboot a 10-year-old franchise with fresh, lower-cost acting talent, none of the four superhero movies launched this summer reached the explosive $500 milion-plus heights of Iron Man, Spider-Man and Batman.

And one of these expensive tentpoles, Warner's "The Green Lantern," bombed, hauling in just $154.5 million globally.

With Disney spending more than $4 billion to acquire Marvel two years ago, studio commitment to these fledling franchises certainly isn't ebbing. But something's gotta give — one studio research executive told TheWrap that the movies — all "origins" stories — are being perceived by audiences as being too much the same. That "origins fatigue" could come into play again, say, next July when Marc Webb's "The Amazing Spider-Man" hits theaters, for the most part replicating the first Tobey Maguire film.

The producers and studios need to find a way to differentiate their offerings.

"It's the same way when you get comedy after comedy," the research exec said, "and the last one in line ends up taking it on the chin a little bit."

4. SAY GOODBYE TO THE QUICKIE 3D CONVERSION

Only one movie this summer managed to open reasonably well in 3D — about 60 percent of the opening-week audience for "Transformers: Dark of the Moon" paid the premium ticket rates.

For most opening weekends this summer, 3D uptake was around 40 percent — despite the fact that 3D-equpped screens were in ample supply.

A studio distribution president told TheWrap that 3D is hardly going away — his company has several upcoming films that will be released entirely in the format, in fact. Plus, not only is DreamWorks Animation's Jeffrey Katzenberg still committed, but auteurs like Steven Spielberg, Martin Scorsese and Francis Ford Coppola have 3D films in the works.

But studios and producers are over the notion that audiences will accept poorly executed 3D conversions, the distribution president said. "If we don't up the ante, the rate will drop to 30 percent and then 25 percent," he said.

As for the much warmer embrace of 3D that's currently occuring among foreign audiences, the executive added, "I have a feeling that they're on an earlier stage of the adoption cycle, where the U.S. was a few years ago, when it was a novelty."

5. THE '90S A-LISTERS ARE ON THE B-LIST

"Larry Crowne" — which teamed Tom Hanks and Julia Roberts — would have been a huge hit based on its mere star power 15, or even 10 years ago.

Instead, its Fourth of July weekend premiere was almost totally engulfed by the fireworks of "Transformers 3," and the $30 million Universal-distributed film has only hauled in a moribund $52 million worldwide to date.

Harrison Ford — even while getting praise from critics for his rough-hewn role — could not pull the Steven Spielberg-produced, Favreau-directed "Cowboys and Aliens" into success. Not even with 007 himself, Daniel Craig, along for the ride.

Likewise, Jim Carrey (Fox's "Mr. Popper's Penguins") struggled at the box office.

Of course, Mel Gibson has his a bit of a compounded audience-perception situation on his hands.

But you'd think that an acclaimed performance and the curiousity factor would have driven "The Beaver" beyond just $6.4 million at theaters.

Brent Lang contributed to this report.