Disney Buys Marvel: An Analysis

Spider-Man has a new boss and it’s Mickey Mouse!

In a move that has both the film and comics genre geek press buzzing, the Walt Disney Company announced today that they will be acquiring Marvel Enterprises, which includes Marvel Comics and Marvel Studios, for a staggering $4 billion. The deal brings to Disney Marvel’s 5,000+ characters including Captain America, Spider-Man and the Fantastic Four into their corporate hierarchy. It was news that caught everyone by surprise and immediately discussion on the deal filled the electronic ether. Not to mention the inevitable jokes that immediately began to fly. (“Coming soon- Xavier’s Academy Musical!”, “Matt Murdock is The Shaggy D.A. He’s his own seeing-eye dog!”)

(And FBOL Comic Book Movie editor William Gatevackes rightly points out that the two biggest comics publishers are now owned by the two major animation houses in film history.)

Of course, amidst all the surprise, a number of questions lurk. Will the family-oriented Disney allow some of the more adult-targeted comics to continue? Probably. What of the Disney properties that are currently licensed out to other comics publishers, such as Boom Studio’s Muppet and PIXAR-related titles? No word yet. What about Marvel’s licensing deal that allows Spider-Man and the Hulk to roam Disney theme-park rival Universal Studios Orlando? That will stay in place for the foreseeable future.

But what changes are we going to see on the movie side of things? Probably not much in the short and even medium term.

The most pressing question that seems to have been generated by today’s announcement is what will become of Marvel’s deal with Paramount Studios to distribute the superhero films that Marvel Studios are producing?According to Marvel Studios honcho Kevin Feige, the agreement which will see Paramount distribute Iron Man 2 next summer, Thor and Captain America in 2011, The Avengers in 2012 and a possible Iron Man 3 will stay in place, at least until all those films have been released. It is doubtful that Marvel would re-up the agreement with Paramount when they can utilize Disney’s own distribution and formidable advertising networks.

As for studio interference, I think Disney will leave well enough alone. Paramount’s deal kept them hands off on the production side of things, and that has allowed Feige to build Marvel Studios’ plan for interconnecting films.While Marvel might not have the string of hits that recently acquired PIXAR Studios has been granted, if the cross-film build-up towards 2012’s The Avengers continues not just with fans but on the year-end balance sheets, then expect Disney to grant Marvel the same autonomy that they have granted PIXAR.

But what of Marvel’s myriad deals that have licensed out many of their characters to other film companies? Currently, 20th Century Fox has the X-Men, Daredevil and Fantastic Four characters, while Sony has rights to Spider-Man and his supporting cast. While Fox has bungled both the potential for long-running Daredevil and Fantastic Four franchises, they seem to be quite happy with the box-office number on their X-Men films. This summer’s X-Men Origins: Wolverine has done over $363 million in worldwide ticket sales, which is enough for the studio to have several more films in development, including a direct sequel to Wolverine and numerous spinoffs. Sony isn’t about to give up their Spider-Man franchise without a fight. The first three films have brought the studio nearly $3 billion dollars and they have plans in place for another three films.

But the answer to how long these two studios can milk their respective franchises lies in their individual contracts with Marvel. These deals were originally struck in the late-1990s, when Marvel was in financial straights and looking for fast infusions of cash. The deals they made then might not have been in their best long-term interest. It is unknown what the terms of the deals are. Were the characters licensed for just a specific amount of time with the rights reverting back to Marvel at that span’s end, whether or not any films have been made? What mechanisms are in place in regards to the option to extend the licensing? If films do get made, are the options to extend the deal automatically activated or do the studios have to meet to hash out an extension?

While on one hand, I can see where it would be tempting for Marvel to just sit back and collect whatever percentages they’re entitled while letting Twentieth Century Fox and Sony take all the financial risks in making these films. On the other hand, I can see the desire to have the characters back under their own corporate umbrella. And I have to confess that the fanboy in me relishes the idea of all of those characters having the potential to interact in Marvel Studio’s burgeoning cinematic universe. With the might of Disney behind them, Marvel Studios just might be able to crowbar back those characters for themselves.

Of course, there is the opportunity for working with other companies under the Disney corporate umbrella- specifically, PIXAR Studios. PIXAR head stated today that he has already met with Marvel execs last week and that the discussion got “pretty excited, pretty fast.” Given that even the worse of PIXAR’s film is still head and shoulders above what any other animation studio is churning out, it is tantalizing to think what these two groups can do when combined.

Of course, all this is speculation, and Disney could do something as surprising and seemingly out of left field as today’s announcement was. Then again, when it acquired PIXAR in 2006, Disney remained hands off and even brought several of its execs into their own corporate hierarchy. While the various components of Marvel Entertainment Group might not have the same levels of financial success that PIXAR had before their acquisition, I don’t think Disney would have forked over $4 billion for a company that was a fixer-upper.