Paramount: We're Making a Killing On Movies We Didn't Produce*

Most of the conversation on Viacom’s second-quarter earnings call was about TV networks and their ad revenue (Silicon Alley Insider‘s Michael Learmonth has the live blog), CEO Philippe Dauman and CFO Tom Dooley did spend a fair amount of time patting themselves on the back about Paramount’s impressive box-office performance this year:

  • number one market share in Hollywood (Enjoy it while it lasts, boys),
  • more than a billion dollars in gross revenues,
  • Iron Man, Indiana Jones 4, Kung Fu Panda.

One potential problem: Paramount didn’t solely produce any of these hits. Iron Man was funded and produced by Marvel and Kung Fu Panda is a DreamWorks Animation production, so Paramount’s just getting a fee for distributing both titles. Indiana Jones was a co-production with George Lucas’ Lucasfilm, but Steven Spielberg and George Lucas will keep most of the money.

Furthermore, Dauman said he was excited about Paramount’s upcoming films: Tropic Thunder (produced by DreamWorks), The Curious Case of Benjamin Button (a co-production with Warner Bros.) and Madagascar: Escape 2 Africa (DreamWorks Animation). This suggests yet again that if/when DreamWorks jilts Paramount this fall, Paramount would do well to come up with a hit franchise of its own. (Granted, Paramount did somehow manage to keep Transformers II, even though the original film was a DreamWorks co-production, and there’s an Iron Man 2, but again that’s a Marvel title.)

*UPDATE: The original version of this post unfairly maligned the performance of the recently released DVDs of Cloverfield and Spiderwick Chronicles. The reason these and other new releases “offset” strong home entertainment performance in Q2 from catalogue, distribution, and re-issue sales, a Viacom spokesman says, is that more new DVDs were released in last year’s Q2.

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