Yesterday’s announcement that the release of the new James Bond film No Time To Die was being delayed seven months due to fears over the coronavirus outbreak may have been disappointing to fans of the suave British secret agent, but in strict terms of business practicality, it was no surprise.
The film is budgeted at over $200 million, meaning that for it to turn a profit it will need to make at least $500 million or so at the worldwide box office. Given that foreign ticket sales have come to outstrip domestic box office take, it is vitally important for every film, and especially pricey blockbuster fare like No Time To Die, to get on as many screens in as many countries as possible.
But fears over the spread of the coronavirus have lead some countries to curtail places where large numbers of people can gather. China and Italy have shut down their country’s movie theaters. Other countries such as Japan and South Korea, which have seen a large number of coronavirus cases have also seen a significant downturn in box office receipts. Given that China especially is often a key component in a film’s path to profitability and Japan is the world’s third-largest film market, delaying the roll out of a film that needs a high monetary return like No Time To Die to a time when those theaters are re-opened may be disappointing to fans but is just a smart and prudent move.
The outbreak which was first reported on in China this past New Year’s Eve has spread internationally at an alarming rate and has infected more than 95,000 people and killed at least 3,300 worldwide as of publication. In the US there are at least 150 confirmed cases. Many states, including California, have declared states of emergency.
No Time To Die is not the first film production to be affected by coronavirus. Last week, production on the Tom Cruise film Mission: Impossible VII shut down while on location in Italy. Ash Is Purest White director Jia Zhangke indefinitely postponed the start of his new film from its planned April start date. Chinese distributors failed to show up at the Berlin Film Festival, leaving films with the opportunity to be bought for the Chinese market.
And with other big ticket films coming up on the release schedule over the couple of months including Disney’s Mulan with its reported budget of $200 million, Marvel Studio’s Black Widow and Universal’s latest Fast And Furious franchise installment F9, do not be surprised if we see more films shifting to later in the year when hopefully this health crisis will be over. A number of films including Onward, 1917, Sonic The Hedgehog and Mulan‘s Chinese releases have already been delayed indefinitely postponed.
Ultimately, according to health experts sourced by the Hollywood Reporter, the coronavirus outbreak could financially impact the film industry by at least $5 billion in terms of lost box office revenue and impacted production. $2 billion of that amount can be directly traceable to losses at the Chinese box office, where theaters have been closed since right before the big moviegoing Lunar New Year holiday weekend.
Last year saw worldwide ticket sales reach $42.5 billion. That makes that $5 billion loss a drop of 12%, a rather precipitous number that could trigger unease amongst stockholders.
But it isn’t just the film industry that is being affected. CBS announced late last week that they were suspending production on the upcoming season of their popular globe-trotting reality competition show The Amazing Race after just three episodes “out of an abundance of caution.”
As of publication, nine of the ten coronavirus deaths in the US have been confined to Washington state. That has become a concern for many of the publishers and creators who were slated to attend Seattle’s Emerald City Comic Con next weekend. Already DC Entertainment, Dark Horse Comics and Penguin Random House have indicated that they were withdrawing from the event. A number of comic book writers and artists have also signaled their cancellation as well.
ReedPop Exhibitions, the operator of ECCC, stated that they fully intend on moving forward with the show. However, they have also said that they understand if attendees might want to skip the show this year. They are even taking the step of reversing their usual no refunds policy on ticket sales. In a statement released late yesterday, ReedPop explained –
Knowing that no two fans are alike, we have decided to make an exception to our no refunds ticket policy for our fans who are unable or uncomfortable attending Emerald City Comic Con in light of current events. We here at Reedpop remain dedicated to running Emerald City Comic Con but understand that not everyone will be comfortable with that decision; if you wish to forgo attending this year’s edition of Emerald City Comic Con, we absolutely respect your wishes and will refund your ticket purchase (details on just how to do this will be on our website).
But the damage may have already been done. As ticket holders see that some of the exhibitors and artists they hoped to see at the show will no longer be there, they may decide to forgo attending. And if attendance were to drop, artists and exhibitors may have a tougher time turning a profit from sales of books, autographs and sketches. And if more exhibitors and artists decide it isn’t worth it to attend that could lead to more fans declining to go causing a further spiral downwards.
Other large gatherings are also seeing the effects of fear of the coronavirus affecting them. The South By Southwest conference has seen presentations from tech giants Apple, Facebook, Twitter and Netflix all withdraw ahead of the festival’s March 13 kickoff. The popular band The National has cancelled its planned upcoming Japanese tour.
The list goes on and will continue to grow as time passes. Will it encompass other upcoming things like April’s CinemaCon in Las Vegas or Tribeca Film Festival or May’s Cannes Film Festival? The Emerald City Comic Con is just the first of the rather busy convention season. If the disease were to spread aggressively, how would that impact other pf the major shows on the convention calendar like June’s Heroes Con in Charlotte, North Carolina or the granddaddy of them all, July’s San Diego Comic Con.
Pretty much the only certain going forward is uncertainty. According to a report in Nature last month, experts are uncertain as to when the outbreak will peak, with estimates ranging from right about now to mid-May. And that uncertainty means that the industry doesn’t know how to make long term plans and that their short term plans will be in constant flux. Look for more films to shift their release dates and for more cancellations and postponements at upcoming festivals and conventions.
The only thing we do know for sure is that the financial impact will be somewhat significant and have their own far ranging, possible long-term effects. Losses don’t just translate into some red ink on a balance sheet and a temporary drop in stock price. It also means that there is less capital at the studio to invest in future projects that might be deemed somewhat financially risky. In a time when a good majority of studio output feels as if it is already based on pre-existing, pre-sold intellectual property, we may see an even sharper swing away from mid-range films towards familiar blockbuster fare.