The billion-dollar movie: R.I.P.

Although we’re watching more video than ever during quarantine, the streaming surge can’t replace lost box office dollars. Will movie theaters survive? Center director Jeffrey Cole does the numbers.

By Jeffrey Cole

The billion-dollar movies that open on 4,000 screens are the ones that command all the attention and get fans into crowded theaters. There is strong evidence that when one or more of these films are in theaters, “a rising tide lifts all boats,” and smaller films prosper as well.

If the studios place their bets correctly, these are the films that can earn $1 billion or more worldwide. Last year, Avengers: End Game set a new record by reaching $2.8 billion.

These are the superstars of film and what every studio and theater chain aspire to achieve.

Like travel, restaurants, sports, and theme parks, the film industry has been severely wounded by the coronavirus pandemic. It will likely emerge from the crisis more transformed and weakened than any of the other businesses.

The billion-dollar film is dead, at least for now, possibly never to return. It simply isn’t possible for a film to earn a billion dollars in 2020.

Movie theaters may take years to return to pre-Covid days, if they ever do. Part II of our Coronavirus Disruption Project shows that as of early July only 11% of people would consider going to a movie theater. More alarming, 42% say they will not consider going until there is a vaccine.

Without billion-dollar films, the studios lose the engine that drives the entire movie business.

These films, budgeted at $200 million or more and accompanied by marketing budgets as high at $75 million, are what get people into the theaters. All that buzz and attention further drives those films when they move to rental and streaming. Without theatrical, their value diminishes to other types of distribution.

As much as $200 million can be collected domestically on opening weekend.

The view from 2019

Last year, Disney, the most successful of all the studios in theatrical, earned 40% of market share through these billion-dollar films. Capturing massive revenue—through a relatively small number of films that suck all the energy away from smaller movies—defines Disney’s strategy. Their entire production and marketing process has been finely tuned to create and move these huge films through the system. It has been a spectacular success.

Extraordinary theatrical box office has the added benefits of increasing streaming revenue as well as creating spin-offs for its television networks and cable channels, not to mention new attractions for its theme parks, cruise ships, and merchandise for its retail stores as well as other retail stores. The whole process begins with massively successful theatrical films.

In 2019 there were nine films that grossed over a billion dollars in worldwide box office:

1. Avengers: Endgame ($2.8B)
2. Lion King ($1.65B)
3. Frozen II ($1.45B)
4. Captain Marvel ($1.3B)
5. Spider-Man: Far from Home ($1.15B)
6. Star Wars: The Rise of Skywalker ($1.1B)
7. Toy Story 4 ($1.1B)
8. Joker ($1.09B)
9. Aladdin ($1.05B)

Of the nine, an astounding seven were Disney’s, as were all of the top four. (Disney also had a stake in an eighth, Spider-Man: Far from Home, through its licensing deal with Sony.)

But what about 2020?

We may never see numbers like this again. Because Disney is so dependent on enormous box office, it will be affected more than any of the other studios as theaters are closed (as well as the closing of its theme parks and cruise lines).

The one bright spot at the moment for Disney is Bob Iger’s prescient move to set up its own version of Netflix. Disney+ has grown exponentially during the pandemic and may ultimately go a long way to offset the loss of theatrical box office. If Disney can transfer massive theatrical revenue to Disney+ (it will take a few years), the decision to start a streaming service will only look smarter and smarter.

When movie theaters suddenly closed in March (for the first time ever), many films planned for 2020 theatrical release were caught in limbo. The films not envisioned as billion-dollar grosses (although sometimes there are pleasant surprises—Bohemian Rhapsody earned close to $1 billion)–were moved to streaming. Universal sold Trolls World Tour directly to consumers at $20. Disney took Artemis Fowl and Hamilton out of theatrical distribution and instead will run both on Disney+. Sony decided it was better to sell the Tom Hanks World War II film Greyhound, intended for theaters, to Apple TV+.

By selling the “smaller” films to streaming services, the studios decided to get the certainty of some revenue now rather than waiting to see what happens with theaters.


There will be no billion-dollar movies — at least not until there is a vaccine.  These are the films that drive the entire business and distribution chains. Everything is disrupted.


Trolls World Tour, not conceived as a billion-dollar grosser, made $100 million at $20 on direct-to-consumer rental. Universal was very pleased, not just because they had an option to release during the pandemic, but also because it was an important move in their war with the exhibitors to shorten the window for streaming. When NBC Universal’s CEO Jeff Shell said he planned to do more testing with short or no windows, AMC—the biggest theater chain—threatened to boycott the studio’s films.

During the pandemic that was an empty threat.

As successful as Universal’s experiment was, and while it might work for mid-level films, it cannot produce (at $20) a billion-dollar film. Trolls World Tour, a sequel, didn’t need to build name recognition.

Lessons learned

There is much to learn about direct-to-home. Can you build a franchise without a theatrical run and large marketing budget? Can all films sell to consumers or just certain types? Will all films be priced the same (as in the theater) or will variable pricing work? If all films are priced the same, then Universal’s $20 may have already set the standard.

At $20, for a film to gross $1 billion it will have to find 50 million homes willing to pay. That looks like an insurmountable goal. It seems impossible, at least for now, that a film can gross $1 billion or more without opening in movie theaters.

Outside of the mid-level movies the studios were willing to release through streaming, what about the films that they believed in normal times would earn $1 billion or more? A few examples: No Time to Die (the latest James Bond), Mulan, Tenet (Christopher Nolan’s latest), Wonder Woman: 1984 and Black Widow.

These are the films driving theatrical for the studios. There is little interest in selling them directly to consumers because they are capable of earning $1 billion or more… someday. Maybe. Costing $200 million or more to make, the DTC numbers just aren’t there.

The studios have pulled these films until things return to normal and they each get their shot at earning $1 billion.

No Time to Die has moved from March to November, as have Wonder Woman: 1984 and Black Widow. In April and May, those seemed like reasonable dates to expect movie theaters to be open again.

No longer.

Release dates: a constant question mark

The original release date for Disney’s live-action Mulan was March 27. Early in the pandemic it moved to July 24, but as that date got closer it moved again to August 21. Warner moved Tenet almost a month from July 17 to August 12, and the studio is likely to move that film again.

In early July, it looks like the Christmas dates will not work either.

The August films if they open then will face many, if not most, movie theaters still closed, and those open will likely be at 40% capacity. A $175 million opening weekend under past conditions may produce $40 million (if that) in the summer of 2020. Films that typically stay in theaters about 26 days might have to stay there for many weeks or months (with additional marketing budgets) to even approximate past revenues.

There will be no billion-dollar movies — at least not until there is a vaccine.

These are the films that drive the entire business and distribution chains. Everything is disrupted.

The film that may be perfectly positioned to bring back some version of massive theatrical revenues is James Cameron’s Avatar 2. First, it is blessed by being scheduled for release December 17, 2021 by which time there may well be a vaccine.

Theatrical will need an event movie that everybody is talking about to re-ignite movie theater attendance. Avatar 2 doesn’t have to build much awareness. It is a highly anticipated sequel to what was the highest grossing film of all time (not adjusted for inflation) until Avengers: End Game.

Until then (and maybe not even then if people get entirely out of the movie theater habit), the billion-dollar movie is dead.



Jeffrey Cole is the founder and director of The Center for the Digital Future at USC Annenberg.



See all columns from the center.

July 1, 2020