‘Knives Out’ sequels: behind Netflix’s $ 469 million Power Play

11:56 am PDT 4/6/2021


Borys Kit

Sources say Rian Johnson, Ram Bergman and Daniel Craig will walk away with more than $ 100 million each.

Just over a year ago, it seemed like an open and closed case.

In February 2020, Lionsgate CEO Jon Feltheimer said during a quarterly earnings call that the company was officially moving forward on a sequel to Knives out, the box office surprise and critics novel starring Daniel Craig and written and directed by Rian Johnson.

But on March 31, in an Agatha Christie-worthy twist, the reveal came that Lionsgate would not release the sequel at all. Instead, Netflix would make two sequels, signing a $ 469 million deal with Johnson and his T-Street producing partner Ram Bergman, both represented by CAA.

The points of the deal were noteworthy: The pact gave Johnson immense creative control, sources say. The Hollywood Reporter. You don’t have to take notes from the transmitter. The only contingencies were that Craig had to star in the sequels and that each had to have at least the budget for the 2019 movie, which was in the $ 40 million range. Sources say Johnson, Bergman and Craig will walk away with more than $ 100 million each.

The other company that missed the sequels was MRC, the Beverly Hills-based production company that funded the first film. (MRC is also co-father of THR via a joint venture with Penske Media titled PMRC.) Sources say MRC had a movie deal with Johnson and Bergman, the filmmaker and producer known for his one-of-a-kind thrillers, loved by critics and on a modest budget. Brick and Looper before they did Star Wars: The Last Jedi. An MRC representative said the company was “proud” to have partnered with Johnson and Bergman in the first Knives out and noted that the duo “have always controlled the rights” to the franchise. (MRC is a minority investor in T-Street, but will not share in the windfall from the new deal, as its stake in the production company came after Knives out it was already done, without giving him part of that movie).

Sources note that Lionsgate had what was considered a robust deal in which the company had the first right to negotiate and the last right to refuse, all part of the safety net of negotiation with which companies normally protect themselves from lose projects. (Lionsgate and CAA declined to comment.) And Johnson and Bergman were considered great supporters of the theatrical experience.

But that was before the pandemic hit, the theatrical crashed, and the backend became non-existent. In January, with the pandemic in full swing and an expected start to summer production for a sequel, Johnson and Bergman questioned the short-term viability of the theatrical release. CAA started looking for the deal, and broadcasters like Netflix took off with a bang. MRC and Lionsgate, which in normal times may have won the project, were unable to compete. “It became a perfect storm,” says a source. “This would not have happened a year ago.”

For Netflix, despite the price tag, the deal made sense on several levels. The streamer gets an instant, proven franchise with sequels to a movie that grossed $ 311 million globally. And it cunningly weakens a theatrical competitor.

“Yeah, you overpay, but Netflix plays chess while everyone else plays checkers,” says a broadcast executive familiar with the deal. “He takes a proven theatrical product off the board and puts it in his pocket. And it’s another way they re-educate audiences to think of broadcasting and their company over studio. “

For others, the deal shows the leverage that sought-after talent is enjoying right now, thanks to competition from streamers. “If you have talent right now and you want to bet on yourself, this is a good time.”

A version of this story appeared in the April 7 issue of The Hollywood Reporter magazine. Click here for subscribe.

Source link