Supercharged: Why Dick Parsons Needs Superman

How a $1.7 Billion Icon Can Lift Time Warner to New Heights

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LOS ANGELES ( -- Superman can jump tall buildings in a single bound and stop speeding trains in their tracks, but Dick Parsons needs him to perform a trickier task -- mobilize every division of the world's largest media company and prove, once and for all, that Time Warner can be more than the sum of its parts.

Photo: Warner Bros.
'Superman Returns' to save Time Warner. See the man of steel through 73 years. Pop up the timeline below.


audio bug PDF: History of the Man of Steel

When Superman returns in "Superman Returns," a $200 million movie that opens in late June, there'll be a lot at stake for its parent company, the toy industry at large and even for those merger-and-acquisition advocates who have argued for the creation of media conglomerates.

$1.7 billion man of steel
Time Warner owns the 73-year-old man of steel. Among other appearances he's been a four-time movie star, a pillar of its DC Comics publishing arm, a merchandising, licensing and animation godsend and, most recently, the center of WB's hit show "Smallville." Advertising Age analysis suggests that Superman properties have already earned more than $1.7 billion.

Rather than letting him shuffle off into retirement, the $43.7 billion media giant is counting on the new movie and a host of other upcoming Superman-centric efforts across almost all its units to boost coffers across its divisions in a way that would effectively prove that those synergies, so often quoted when AOL and Time Warner came together in 2000, are more fact than fiction.

"There's a huge expectation that this will re-launch Superman as an ongoing property," said Brad Globe, president of Warner Bros. Worldwide Consumer Products. "We want to draft off the movie, but we want the marketplace to feel that it's not just dependent on the movie."

"It's an extraordinary asset," said Ken Markman, CEO of KKM Global Brand Strategies and a former Mattel executive. "If you're going to reinvent something so iconic, you can't afford to have it fail."

400 licensing partners worldwide
"Superman Returns" has been in development for a number of years with a revolving door of filmmakers, writers and talent. Along the rocky route, the studio kept seeing sparks of interest in the property -- a 1997 animated show drew a steady following, "Smallville" took off on the WB, and new lines of product based on the iconic "S" shield sold well when they hit the market a few years ago. Leading up to the June 30 release of the film, the studio has signed 400 licensing partners worldwide.

There's a plan in place, Mr. Globe said, to keep "Superman" fresh long after this summer's movie leaves the multiplex. The studio already has announced another feature film with "Superman Returns" director Bryan Singer, likely for 2009, and possibly a direct-to-video movie in between the upcoming release and the 2009 offering. There will also be a steady stream of entertainment and product, directed by the studio's global brand management team, which shepherds its franchise properties through every part of their life cycle.

"There are people solely focused on our three-to-five event properties a year," said Gaetano Mastropasqua, senior VP-promotions of the studio's global brand management division. "We nurture the franchises."

Sean McGowan, analyst at Harris Nesbitt Gerard, doesn't compare Superman's potential to a phenomenon like "Star Wars" with its six movies and billion-dollar licensing programs over 20-plus years, but said there are positive indicators the property can succeed. He said consumer interest moves quickly. "Properties don't last as long as they once did."

The weight of franchise films
Stu Seltzer, partner in Marketing on Demand, a licensing, marketing and valuation company, said studios are increasingly developing franchise films as a way to maximize profit. "The value spreads across the entire company," he said. "If the movie's a huge hit, it will affect their stock price. The performance of these kinds of projects ripples throughout the company, either positively or negatively."

"Superman" has been a hit on the big screen before. Starting in the late '70s, the late Christopher Reeve starred in four films that pulled in more than $300 million domestically and double that worldwide. DVDs, merchandise, live action and animated TV series followed, and continue to the current day. There have been original "Superman" films or TV shows created in 22 of the past 25 years, according to DC Comics, and new media offerings -- books, comics, animated shows and so on -- created around the property in 52 of the past 66 years. There are 35 "Superman" titles on DVD, counting the classic TV show from the '50s, "Lois & Clark" and various animated shows.

"The property has worked in the widest range of media, from radio to newspaper comic strips to cartoons, TV and film," said Paul Levitz, president and publisher of DC Comics. "That's the most powerful indicator of how deeply he's woven into the popular culture."

Superman has shown his financial might in a number of ways. "Smallville," which is produced by Warner Bros. TV and airs on the WB network, is having a renaissance in its fifth season, attracting an average of 5.5 million viewers, up 8% from a year ago. Its recent 100th episode pulled in more than 6 million viewers. It ranks first in its time period, season to date, with men 18-to-34. Warner Bros. reaps about $850,000 an episode by selling reruns of "Smallville" to cable channels. It also sells the show internationally.

Crowded summer schedule
"Superman Returns" launches into perhaps one of the most competitive years in film history, with big-budget, effects-laden, star-studded event movies stacked one on top of the other from May through July. Industry watchers say they've never seen as many tent poles staked in the ground in such a short period, with "X-Men III," "Mission: Impossible III" and "Da Vinci Code" just a few.

Warner Bros.' movies, TV shows and home entertainment, which includes New Line Cinema, pulled in $11.9 billion in revenue for the fourth quarter of 2004 and the full year 2005, making up 27.3% of Time Warner's bottom line.

To whip up interest in "Superman Returns," Warner has gathered Pepsi-Cola Co., Burger King,, Duracell and Quaker State as marketing partners. Toymakers are also counting on the man of steel to give the industry a lift.

According to the NPD Group, the U.S. toy industry was down 4% in 2005; retail sales declined to $21.3 billion from $22.1 billion the year before. There will be a raft of Superman products at major retailers like Wal-Mart, Toys 'R' Us and Target. Mattel, which is producing much of the Superman line, will put a heavy ad push behind its products from summer through fall.

Entertainment-licensed product, which has been flat in some spots and declining in others, could use a boost. "We need success stories," said Gary Caplan, president of Gary Caplan, a licensing consultancy that has several clients involved in "Superman Returns." "We know retailers are buying into this property, but we don't know yet if consumers will."

They had better. Time Warner is counting on it.

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Bradley Johnson contributed to this report.

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