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Since the 1970s, franchises have steadily grown in their share of the box office, at the expense of original works. At first glance, it’s not entirely obvious why Hollywood studios keep expanding their franchises with new films, despite many having had underwhelming ticket sales or been poorly received: The fifth installment of the Indiana Jones saga lost Disney nearly $100 million—also roughly what Paramount Pictures lost on the seventh Mission: Impossible film. This fall, Warner Bros Pictures’ second Joker movie, having cost up to $200 million, earned less than $38 million in its opening U.S. weekend. So why do franchises keep dominating Hollywood?

Andrew deWaard is an assistant professor of media and popular culture at the University of California San Diego and the author of the open-access book Derivative Media: How Wall Street Devours Culture. DeWaard says understanding the rise of film franchises means following the money—specifically, understanding the transformation of studio ownership, how that transformation has bent the industry toward a focus on short-term profits, and why that focus has favored sequels and prequels. For a while, streaming offered filmmakers well-funded opportunities to create original series, but now that too has been taken by the same logic—leaving not just less and less space for creativity in Hollywood, but more and more uncertainty about its long-term sustainability …

• “As recently as 1988, original stories accounted for more than 40 percent of theatrical U.S. box-office sales. That share fell to just 6 percent by 2019. Meanwhile, franchises—which used to have about a quarter of the market through the ’90s—now have nearly three quarters of the market—when you include other kinds of adaptations, they account for all but 6 percent. If we look at just the top 20 highest-grossing movies in the ’80s and ’90s, about 25 percent were prequels, sequels, spin-offs, remakes, reboots, or otherwise parts of franchises. Since 2010, it’s been over 50 percent every year. It’s actually reached 90 percent more recently.”
• “People often ask me why these entertainment companies behave in ways that might seem to hurt them in the long term. But it’s sort of like that line from When a Stranger Calls: “It’s coming from inside the house.” Industry CEOs and CFOs today aren’t as interested in the long-term health of their companies as you might imagine. There’s been runaway executive compensation: They’re making tens or even hundreds of millions of dollars every year; mergers, acquisitions, diverting profits to venture capital, cooperating with hedge funds, selling to private equity—it’s all very lucrative for the players involved.”
• “It seems shortsighted to have eliminated the well-oiled practice of windowing movies: starting by making money on a theatrical release, then putting the movie on pay television, and then eventually showing it on broadcast TV. Now, movies and TV series often go straight to streaming, which appears to limit long-term profits. But it would seem Netflix isn’t concerned with trying to maximize the long-term profits a movie could make—let alone cultivate interest in film as an art form—so much as it’s trying to position itself as a monopoly.”

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But investors are unimpressed. On the next trading day, stock prices fell on the Hong Kong exchange, China’s most important market. Meanwhile, shares and currencies across Southeast Asia are closely tied to the Chinese economy, and their values nearly all declined, too—even though the debt relief just enabled Chinese localities to give Chinese companies favorable deals on land purchases and tax breaks to increase production, which should theoretically boost the Chinese economy.

What’s happening here?

In September, Victor Shih looked at the problems behind China’s sluggish economy. Local-government debt, Shih says, is one of a few major structural issues—also including population decline and a housing-market crash. But these debts are now so high that Beijing would need a stimulus two to three times as high as the one announced this month to revive the economy. Yet they’re also so high that China can’t afford it.

—Michael Bluhm

• Australian scientists believe they’ve figured out how to use patterned lighting to help people avoid being attacked by sharks—which have poor eyesight and can mistake surfboards or kayaks for seals: “… we’re changing the shape of the silhouette so that sharks don’t recognize it as potential prey. They seem to be looking for a dark object.”
• The U.S. has banned TSMC, the world’s biggest manufacturer of semiconductor chips, from exporting its most advanced chips to any company in China: “The action comes as both Republican and Democratic lawmakers have raised concerns about the inadequacy of export controls on China and the Commerce Department’s enforcement of them.” … Since 2022, Washington has been gradually tightening the exports of chips and chip-making tools, as part of a political strategy to keep China’s AI firms and military from cutting-edge chips.
• In Canada, musicians with the Kitchener-Waterloo Symphony have helped rescue the orchestra from bankruptcy: “The musicians took the symphony’s fate into their own hands. They got in touch with its foundation and creditors, and built a new board, tapping Bill Poole, a retired local lifelong arts administrator, to chair it. The newly formed team of directors and musicians spent months trying to find a way to resuscitate the Southern Ontario symphony. … ‘If it weren’t for the musicians, we would not be here today.’”

• For all the challenges facing humanity, we’re not doomed—though you mightn’t always know it reading the news. Want to stay informed without the drama? Read the Donut. It’s unbiased, quick, engaging—and free. Sign up here.

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