Disney's New Superhuman Powers

Where the Mouse Will Look to Harness New Licensing Opportunities After Marvel Acquisition

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NEW YORK (AdAge.com) -- Marvel characters such as the Black Panther, Mockingbird and 3-D Man can do a lot more than use super-stealth, great fighting abilities and heightened strength. If the giant Walt Disney Co. is lucky, these are the types of heroes that will help the home of Goofy and Donald Duck generate even more content across a broad range of traditional and new-media venues -- and thus boost ad dollars, subscriptions and licensing revenue in the process.

Figuring out how much any one Marvel character is worth to Disney is tricky. Much depends on how the characters are used and on fans embracing or rejecting the new ventures. The nature of the various agreements means some revenue could be shared with other companies too. But as Marvel's current use-of-character agreements with Disney rivals expire, licensing experts firmly believe the Mouse House will enjoy an increased stream of revenue built off the Marvel characters' backs.

Besides the myriad content plays, the fans are rabid. Comic-book aficionados are "the people who are at the movie on the first Friday night when they open. They're the first ones on line at the DVD store when DVDs come out," said Michael Uslan, the comic-book writer who produced "Batman Begins" and "The Dark Knight." "They keep buying the same products over and over again in many different formats."

Can any of these characters generate enough to justify $4 billion -- the price Disney paid for Marvel? Below we try to sketch as much as possible what money's at stake when a Marvel character hits the big screen. Thor and Captain America are already slated to appear in films produced by companies other than Disney, but at present Spider-Woman would seem to be ripe for development.


A blockbuster adaptation of a comic-book character can generate big returns. According to Box Office Mojo, comic-book adaptations make an average lifetime gross of around $96.8 million. While "The Dark Knight" sparked around $533.3 million, films about lesser-knowns such as "Elektra" have generated around $24.4 million, according to Box Office Mojo.


Popular characters can appear on anything from statuettes to bedding, and retail sales of products featuring entertainment characters came to about $9.88 billion in 2008, according to Ira Mayer, president and publisher of The Licensing Letter. He estimates Disney controls 35% to 40% of the market and believes any one character can generate up to $1 billion in a given year. Marvel's net sales from licensing came to about $292.8 million in 2008, according to the company's annual report.


Don't forget, the Marvel characters are first and foremost comic-book creations. Captain America, for instance, appears not only in his own comic as well as Marvel's "New Avengers," but in various limited series and compendiums of archived material and graphic novels.
Digital media is giving rise to what is known in the industry as "motion comics" that can be viewed online or even downloaded to an iPod, offering another revenue stream. In 2008, Marvel controlled 41% of the dollar share of comics sold at independent comic-book stores, and its net sales from publishing, including advertising, came to $125.4 million, according to its annual report.


Characters can spawn any number of projects, from live-action dramas (Think "Smallville" ) to cartoons (an old Spider-Man cartoon is running on Disney's XD cable network). According to TNS Media Intelligence, "Smallville" earned $65 million in ad revenue in 2008, while Cartoon Network's animated "Batman: The Brave and The Bold" generated $361,000.


Marvel characters are already in use at NBC Universal's Universal theme parks, but those not covered by previous agreements could certainly wend their way to Disneyland or other Disney destinations, whether in the form of appearances or even new rides based on movies or specific stories, perhaps boosting attendance among those who might not have considered a Disney trip before. Walt Disney generated about $11.5 billion in 2008 revenue at its parks and resorts, according to the company's 2008 annual report.


An emerging venue, but experts believe it could take off in the future. In late August, Eidos Interactive and Time Warner's Warner Brothers launched "Batman: Arkham Asylum," based on the adventures of the popular DC Comics hero. Licensed Marvel games have grossed nearly $1.3 billion since 1995, and are the fourth-highest-grossing non-video game license in the industry (following the NFL, NBA, and Star Wars). In total, Superhero licenses have grossed over $1.5 billion since 1995. U.S. computer and video-game-software sales grew 22.9% in 2008 to $11.7 billion, according to the Entertainment Software Association -- more than quadrupling industry software sales since 1996.

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