Success in sequels

As Hollywood rolls the credits on 2006, it’s enjoying a box-office resurgence thanks largely to one of the film industry’s most venerable stars – the sequel.

Led by such blockbusters as “Pirates of the Caribbean: Dead Man’s Chest,” “X-Men: The Last Stand” and “Ice Age: The Meltdown,” domestic movie receipts are poised to overtake the $8.9 billion gross for all of 2005.

Driving the comeback were sequels that reaped $2 billion – more than 40 percent above what similar films grossed a year earlier – and accounted for six of the year’s 12 biggest movies.

In the coming months, Hollywood will bring out even bigger guns in what is shaping up as an arms race of sequels.

Coming in May will be the third installments of the “Spider-Man,” “Shrek” and “Pirates” movies, with another likely hit, “Harry Potter and the Order of the Phoenix,” following in July.

Those films are among 19 sequels scheduled for 2007, which also include “Fantastic Four 2: Rise of the Silver Surfer,” “Ocean’s Thirteen,” “Evan Almighty” and “National Treasure 2.”

“Next year, there’s a greater concentration of known, commercially viable movies than we’ve ever seen before,” says John Fithian, president of the National Association of Theatre Owners trade group.

Although 2006 won’t be a record, the sequel-driven recovery is all but erasing the angst of last year, when Hollywood executives lost sleep over the steepest attendance drop in 20 years and the third down year in a row at the box office.

Ironically, one of the key reasons cited was a series of uninspiring sequels such as “The Legend of Zorro,” “Transporter 2” and “XXX: State of the Union” that failed to lure large crowds. Critics speculated that moviegoers were tiring of seeing recycled characters and ideas.

This year, audiences found Hollywood’s choice of sequels far more appealing.

“When you make a good sequel, people go,” said Sony Pictures movie chief Amy Pascal, who oversees the “Spider-Man” series. “When you make a sequel that’s not good, it shows.”

The second installment of the “Pirates” series set an all-time opening weekend record this summer. It doesn’t hurt that Johnny Depp has emerged as one of the world’s biggest box-office draws and has embraced his popular Capt. Jack Sparrow character to where he is reviving him for yet another “Pirates” sequel.

Producer Jerry Bruckheimer, Hollywood’s top maker of big-ticket franchises, recalls that Depp was so into being Sparrow that he didn’t want to leave the set on the last day of shooting.

“He didn’t jump in his SUV and split like most big stars,” Bruckheimer says. “He loves the character.”

Not every successful sequel has to have the size and budget of a “Pirates.” Some of the biggest returns on investment this year came from lower-budget films like “Jackass: Number Two” and “Saw III.”

Next year’s lineup includes “The Hills Have Eyes II,” “Resident Evil 3,” “Hostel 2” and “Saw IV.”

But the cost of betting on new installments of established hits often reaches blockbuster proportions. Production and marketing outlays on a single title can total more than $400 million.

Studios will spend more than $1 billion alone next year to make and market “Pirates of the Caribbean: At World’s End,” “Spider-Man 3” and “Shrek 3.”

Costs have soared so much that even some big box-office performers aren’t bottom-line hits for studios.

This summer’s “Mission: Impossible III” grossed nearly $400 million worldwide, earning star Tom Cruise some $80 million. But the film’s backer, Paramount Pictures, will only break even given the movie’s high production and marketing costs.

One reason budgets rise so much is that producers crank up the special effects, under pressure to create a spectacle that outdoes the earlier films.

“We always try to top ourselves and there’s a cost attached to that,” says Laura Ziskin, producer of the special effects-laden “Spider-Man” films.

Studios also usually end up paying higher salaries to keep their original stars on board. Because filmmakers are eager for them to revive their roles, stars enjoy more leverage in negotiating their paychecks.

At 17, “Harry Potter” star Daniel Radcliffe is reportedly England’s wealthiest teenager, with his paycheck steadily rising with each film to where it is now a reported $14 million.

One way to try to freshen a franchise to make it more appealing is to develop more emotional, complex and even darker sides to familiar characters.

Critics praised “Batman Begins” and the latest James Bond film, “Casino Royale,” for reinventing their characters by getting them away from the more cartoonish figures they had become.

In “Spider-Man 3,” the superhero’s alter ego, Peter Parker, confronts his darker, vengeful side when his red suit suddenly turns jet black and amps up his powers. In the next “Harry Potter,” the hero will enjoy his first on-screen kiss while continuing his evolution from outsider into a leader.

Tom Rothman, co-chairman of 20th Century Fox, says his studio is keeping the “Fantastic Four” series of Marvel adaptations fresh by introducing the Silver Surfer – the intergalactic, introspective superhero he calls “the holy grail of comic book characters.”