Scarlett Johansson sued Disney. Why?
On Thursday, July 29th, Scarlet Johansson, one of Hollywood’s highest paid actresses sued Disney in a Los Angeles District Court. Her latest Marvel film, “Black Widow”, was supposed to have its theatrical debut beforehand, but Disney decided to launch the film simultaneously on its streaming platform, Disney+.
According to the star, the media giant breached its contract. The actress said in the suit that she was granted an exclusive theatrical release, which would also influence her salary, since her earnings would be partly based on the box office performance of the film.
By launching the film simultaneously on the streaming platform, Johansson stated that this was not only a breach of contract, but that the availability of the film on Disney+ would significantly decrease the box office revenue of the film – Johansson is said to lose up to $50 million because of this.
Johansson’s suit is one of the first legal actions that we see Hollywood stars take against the media giants which produce their films, but it certainly won’t be the last. With the arrival of the streaming age, media companies are prioritizing their streaming services in order to grow the platform, especially by placing their high value content on there.
However, this may come at a cost to actors and producers, who still rely on box office revenues for their earnings. Thus, whether or not Disney breached its contract with the famous actress, one thing is clear – the entertainment industry is increasingly relying on the rise of streaming to increase their growth, and this could happen at the expense of those involved in the film.
The suit also stated that the top two executives at Disney – its Chairman Robert Iger and Chief Executive Bob Chapek are bound to benefit from this, since their annual bonuses are directly tied to the performance of its streaming platform, Disney+. This is a powerful enough incentive that the top management of the media giant has as its prime priority the growth of its subscribers’ base and this has to be done even at the expense of its contractual promises.
With over 100 million subscribers worldwide, there is increasing pressure for streaming platforms to perform, as there is a battle for consumers’ time, attention and money in a field that is increasingly becoming overpopulated with streaming options – from Netflix, to HBO and Amazon Prime being the main players.
The current business model is different than the previous one. Whereas movie studios used to pay actors and producers a small fee upfront and then they would share portions of the revenue of the ticket sales when films hit theatres, media giants do it differently now in the streaming age. They pay a much larger sum up front, but this gives the studio complete control over future revenue. This means that actors, producers – everyone involved in the making of a high-end film are paid as if the film is already a blockbuster even before this film has been released.
In response to Johansson filing suit on Thursday, the media giant didn’t wait long to respond. On Friday, the Walt Disney Company leaked the salary of Scarlet Johansson, who earned $20 million to do the movie. The talent agency of the actress rose to her defense, stating that the media giant is trying to “weaponize her success as an actress and businesswoman”.
A Disney spokesman’s response to Johansson’s lawsuit was described as having no merit and of being “especially sad and distressing in its callous disregard for the horrific and prolonged global effects of the Covid-19 pandemic”. In other words, the media entertainment giant used the health crisis as an excuse to pardon and rationalize their launch of the film on the streaming, implying that viewers would be safer and more protected if they watched it from the comfort of their homes on Disney+, rather than in cinemas.
In addition, as the world is still reeling from the pandemic and life has not completely gone back to normal, Disney contemplated that the box office revenues from theaters would not be the same as before the pandemic, with cinemas working at limited capacity and people still reticent about exposing themselves like this.
After learning of the dual-release strategy – Johansson said that, according to her contract, a period of 90 to 120 days of exclusive release rights will be granted to the film in theaters, before it would be available on the streaming platform – she tried to renegotiate her contract. However, both Marvel and Disney proved unresponsive interlocutors.
Given how Johansson was granted an exclusive theatrical release in her contract, this would deprive the actress of millions of dollars in potential box office revenue. Additionally, making blockbuster films available to watch on streaming platforms from their first release day would hurt box office revenues, stating that theater releases are still the most lucrative option.
Furthermore, some Disney executives even stated that by doing a simultaneous launch of the film on its streaming platform could hurt the Marvel brand. In the last 10 years, Marvel has made some of the most successful blockbusters and for them to be moved on the streaming platform would tarnish the allure of the Marvel experience.
One thing is clear: Scarlett Johansson may be one of the first A-list Hollywood stars to engage in such legal action against the media giant sponsoring her film, but she’s certainly not the last. The entertainment industry entering the streaming era completely changed the rules of the game, the way media giants relate to their A-list actors and how they make up their release strategies. Contractual breaches may be just a drop in the ocean compared to the profits they could make from the continual growth of streaming platforms.
So, actors: beware!
Photo source: Marvel Studios – Dinsney/AP