Netflix, Still Reeling, Bet Big on ‘The Gray Man’

Anthony and Joe Russo like to go big.

In 2018’s “Avengers: Infinity War,” the directors-brothers shocked fans when they wiped out half the world’s population and let their Marvel superheroes fail. The following year, they raised the stakes with the three-hour “Avengers: Endgame,” a film that grossed $2.79 billion at the worldwide box office, the second highest figure ever to that point.

And now there’s “The Gray Man,” a Netflix movie they wrote, directed, and produced. The streaming service gave them nearly $200 million to trot around the world and have Ryan Gosling and Chris Evans portray CIA shadow operatives trying to kill each other.

“It almost killed us,” Joe Russo said of the filming.

An action series took a month to produce. It involved big guns, a tram roaring through Prague’s Old Town and Mr. Gosling fending off an army of assassins while handcuffed to a stone bench. It’s one of those showstoppers that cheer the audience on. The moment cost about $40 million to make.

“It’s a movie within a movie,” Anthony Russo said.

“The Gray Man,” which opens in select theaters this weekend and will be available on Netflix Friday, is the streaming service’s most expensive film and arguably its biggest bet at creating a spy franchise in the form of James Bond or “Mission.” impossible.” If it works, the Russos have plans to expand the “Gray Man” universe with additional movies and television series, as Disney has done with its Marvel and Star Wars franchises.

But those franchises, while boosted by streaming and integral to Disney+’s ambitions, are primarily theatrical ventures. “The Gray Man” will be released in 450 theaters. That’s a far cry from the 2000 or so a typical big-budget release would pop out in opening weekend. And the near-simultaneous availability of the film on Netflix ensures that most viewers will watch it on the service. Movies that Netflix releases in theaters tend to leave them much faster than movies from traditional studios.

“If you’re trying to build a franchise, why start it on a streaming service?” asked Anthony Palomba, a professor at the University of Virginia’s Darden School of Business who studies media and entertainment trends, particularly how consumer habits are changing.

The film comes at a critical time for Netflix, which will announce its second-quarter results on Tuesday. Many in the industry expect the results to be even grimier than the two million subscriber loss the company forecast in April. The company’s first-quarter earnings led to a sharp drop in its share price, and it has since fired hundreds of employees, announced it will create a cheaper subscription tier of commercials, and said it plans to share passwords between friends. to deal with. and family.

Despite the current difficult period, Netflix’s deep pockets and hands-off approach to creative decisions made it the only studio able to match the Russos’ ambitions and their quest for autonomy.

“It would have been a dramatically different film,” said Joe Russo, referring to the possibility of making “The Gray Man” in a different studio, such as Sony, where it would originally be produced. The brothers said that if they went elsewhere, they would have to cut a third of their budget and cut the action of the film.

A person with knowledge of the Sony deal said the studio was willing to pay $70 million to make the film. Instead, the Russos sold it to Netflix in an agreement that allowed Sony to recoup its development costs and receive compensation for the time it produced. Sony declined to comment.

The film features nine key action sequences, including a mid-air battle with emergency flares, fire extinguishers and Mr. Gosling’s struggle with a parachuted enemy as both tumble from a bombed-out plane, Anthony Russo said.

“Ambition is expensive,” said Joe Russo. “And it’s risky.”

Even in this humbling moment, Netflix can pay more upfront if it’s not saddled with the costs associated with much bigger theatrical releases. And for Scott Stuber, Netflix’s head of global cinema, who green-lighted the “Bourne Identity” franchise while at Universal Pictures, movies like “The Gray Man” have been what he’s been aiming for since joining the company five years ago. came.

“We haven’t really been into this genre yet,” Mr Stuber said in an interview. “If you’re going to do it, you want to be dealing with filmmakers who have created some of the biggest franchises and the biggest action movies in our industry over the past decade.”

The Russos are also producing the sequel to “Extraction” starring Chris Hemsworth for Netflix and have just announced that Netflix has announced their next directorial venture, a $200 million sci-fi action movie, “The Electric State,” starring Millie Bobby Brown and Chris. pratt.

Stuber pointed to the sequel to “Extraction” and a spy movie starring Gal Gadot, “Heart of Stone,” both coming out next year, as proof that the company is still making great strides despite the difficulties. However, he acknowledged that recent business realities have forced the company to think harder about the projects it selects.

“We’re not insanely cutting our expenses, but we’re cutting volume,” he said. “We’re trying to be more thoughtful.”

He added: “We were a company that was a volume business for a long time. And now we are very specific about targeting.”

Niija Kuykendall was hired by Warner Bros. late last year. to oversee a new division that will focus on making mid-budget films, in the $40 million to $50 million range, which the traditional studios have all but given up because their box office potential is less certain. And Mr. Stuber pointed to two upcoming films — “Pain Hustlers,” a $50 million thriller starring Emily Blunt, and a self-titled romantic comedy starring Nicole Kidman and Zac Efron — as examples of the company’s commitment to movies. of that size.

In recent months, Netflix has also been criticized by some in the industry for how much — or how little — it spends to market individual movies. The marketing budget has remained essentially the same for three years, despite a significant increase in competition from services like Disney+ and HBO Max. Creators often wonder if they’re going to get the full Netflix marketing power or just a few billboards on Sunset Boulevard.

For “The Gray Man”, Netflix sent the Russos and their cast to Berlin, London and Mumbai, India. Other promotional efforts have included national television ads during National Basketball Association and Indianapolis 500 games and 3D billboards in various locations such as Las Vegas and Krakow, Poland.

“It’s very large scale,” Joe Russo said of Netflix’s promotion of “The Gray Man.” “We’re doing a world tour to promote it. The actors come with us. It’s a lot like the work we’ve done to promote the Marvel movies.”

For the small-scale theatrical release, Netflix will place “The Gray Man” in some of the handful of theaters it owns — such as New York’s Paris Theater and Los Angeles’ Bay Theater — and with chains like Cinemark and Marcus Theaters. And while Joe Russo calls “The Gray Man” “a forget-to-eat-your-popcorn movie,” Netflix won’t disclose its box office numbers.

The theatrical side of the movie business is a mystery to Netflix. The studios’ risk appetite is often greater than traditional studios because they don’t spend as much money to run movies in theaters and don’t have to worry about the box office. On the other hand, the lack of large-scale theatrical releases has long been a bottleneck for filmmakers who want to show their creativity on the largest screen possible and hope to build a buzz with audiences.

And the box office strength in recent months for films as diverse as “Top Gun: Maverick”, “Minions: The Rise of Gru” and “Everything Everywhere All at Once” (which the Russos produced) has prompted many to to the influence of cinemas, which has severely hampered the pandemic.

Mr. Stuber acknowledged that a greater presence in the theater was a goal, but one that requires a consistent offering of films that can connect with global audiences.

“That’s what we’re trying to achieve: do we have enough of those movies across the board where we can be in that market?” he said.

It would also require Netflix to consider how long it lets its movies play exclusively in theaters before they appear on its service. While the theater window for ‘The Gray Man’ is very short, the Russos hope the film will show that Netflix can be a home for the kind of big-budget crowd pleasers the brothers are known for.

“Knowing that you ultimately have a distribution platform that can pull in 100 million viewers like ‘Extraction’, but also the potential for a large theater window with an appropriate promotional campaign behind it,” said Joe Russo, “you have a very powerful studio.”

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