For the past several years, Marvel Entertainment has built its reputation not just on a string of hit movie franchises but also on a string of smart business moves, maximizing the creative and profitability potential for each new release. The first wave-maker for the superhero giant was their 2005 move to self-finance their own movies starting with Iron Man and the rest of the Avengers franchise, and the success of that move was instrumental in Marvel’s $4 billion acquisition by Disney last summer.
Today, those two pieces of the Marvel business model collided as Paramount Pictures – who had distribution rights to the self-financed Marvel films -Â relinquished distribution control of said films to Disney starting with May 4, 2012’s “The Avengers” and continuing to “Iron man 3.” Both Variety and The Hollywood Reporter revealed the details of the arrangement, which sees Disney paying Paramount at least $115 million dollars.
That number represents the expected amount of cash the studio would have earned from its participation in distribution of the next two Marvel movies after “Thor” and “Captain America” (which it will still release), but the deal does allow Paramount to make even more off the incoming pics as the full agreement lets them retain their 8% profit of “The Avengers” if it clears expected box office predictions as well as 9% on “Iron Man 3.”
For Disney’s part, the studio now has two proven tent-poll pictures to flesh out their incoming slate, and the company made quick work of announcing a May 3, 2013 release for “Iron Man 3” – nearly one year after “The Avengers” hits theaters. Capitalizing on Marvel’s movie might was a major factor in the entertainment giant’s purchase of the comics publisher, so this early move to control Marvel movies should come as no surprise.
“Five years ago, when Paramount and Marvel made our initial deal, both our businesses were in very different places,” Paramount chair-CEO Brad Grey told Variety. “We are grateful for the partnership we have had with the terrific Marvel team over these years and proud of the work we have done together. Today, this new agreement is the right deal for Paramount, for Marvel and for Disney.”