MikeAI, and everybody who bought MVL

[Winetalk.com]

Originally posted by slavdogg@Jun 28 2004, 12:35 PM
Why is Marvel a hot stock now ??

Serge are you reading comic books now

that's why:

Of course this is not mentioning the comics, hats, video games, DVDs, T-shirts and collectible figures that will hit the shelves.

It's hard to get a handle on the total amount of merchandise sales, since unsold products will be discounted.

By some industry estimates, the total of all licensed retail products is $73 billion a year, with $16 billion from movies.

"There's always the risk of overestimating the value of the licensed merchandise. It's hard to predict with any real accuracy what the film will generate," said Riotto. "Some have great licensing potential, some don't. In the case of 'Spider-Man,' we know there's great potential the studio has built into the budget of the film."

The move has been very heavily licensed, said Marty Brochstein, executive editor of the Licensing Letter, who estimates the film is tied to some 200 licensees worldwide. "The question is in a lot of people's minds as far as retail goes: What percentage of 'Spider-Man 1' will they do on 2?"

Figuring out how much a movie will make on licensed products is difficult, as studios generally don't divide licensing revenue up by picture. Neither Sony (SNE) nor Marvel Enterprises (MVL) would comment on any aspect of their licensing.

The International Licensing Industry Merchandiser's Association estimates television and movie licensing revenues pulled in $2.5 billion in 2003.

According to information on Marvel's Web site, its licensing revenue has surged from $19 million in 2000 to over $200 million in 2003. The company expects international licensing and studio segments to increase "dramatically" from 2003 levels.

But making money on a sequel can be a tricky thing for studios. "It's kind of an interesting situation because of the fact ('Spider-Man') was such a merchandising hit the first time," said Brochstein.

"One school of thought says 'how many people will buy more Spider-Man stuff,' while others are saying they're such fans that they'll buy the stuff."

Brochstein said Spider-Man probably has an easier licensing road than other character-built films such as "Shrek" or "Finding Nemo."

"For the first 'Shrek' movie," he said, "there was very little merchandise because retailers and manufacturers have over the past several years, gotten very, very cautious of backing a property that they're not familiar with from some other medium or because it's a sequel."

"Shrek, though it was based on a book, was not something out of the popular culture. People didn't know what a Shrek was, whereas Spider-Man is a well known character that had an ongoing licensing program, based on the classic Marvel character," said Brochstein.

"Shrek 2" saw different fortunes for its licensing, as manufacturers and retailers didn't commit early enough to the last film and got caught out short.

Aside from retailing, the "Spider-Man 2" opening Wednesday is drawing attention for good reason, as the first "Spider-Man" film amassed that $821 million worldwide on a budget of $139 million.

Sony ponied up some $200 million to make the new film, which the Spider-Man live action star Tobey McGuire has said will start with a bang since the character's origins have already been set up.

For studios, and licensees alike, the buzz will boil down to the opening weekend for "Spider-Man 2." Expectations are understandably high with many expecting it will easily surpass the $115 million opening weekend in the U.S. for the first "Spider-Man" film. The first film debuted in early May, while the sequel will feed into the Fourth of July fireworks weekend.