Everyone has a different opinion about the lopsided deal that Warner Bros. made with the filmmaker Ryan Coogler. A $90-100million budget. A first dollar gross backend profit definition, ‘final cut’ on the film, and reversion of the original concept and IP (Intellectual Property) rights to him after 20 or 25 years.
SOME SAY it’s racist to even question the terms of the deal because Quentin Tarantino got a similar deal years prior and no one raised much of a stink (Side question: if people think it’s racism, can one argue it is reverse racism when trade papers tout a current $161million BOX OFFICE total ($236.7million as of 5.4.25) on a $160+million production/marketing spend as the biggest financial triumph since the new Star Wars trilogy? And might it be double racism (to make up a phrase) when Sinners’ net profit is dwarfed compared to another African American centric project-Jordan Peele’s US which was a much bigger success. Made for only $20million and marketed for $20-30million–it’s worldwide BO was $256million. Why doesn’t this get highlighted?)
SOME SAY the deal sets a dangerous precedent that leaves studios financially vulnerable to the demands of filmmakers.
SOME SAY good on Ryan Coogler (David) slaying Warner Bros. (Goliath). It takes two to tango–and Warner Bros was willing to dance.
These SOME SAY opinions can be defended in one way or another…and we will grant them that.
HOWEVER, WE SAY this controversy is not about what some say. It’s about basic math and hubris. It’s about Warner Bros. making the wrong deal for the wrong material for the wrong reasons (aka an employee putting self interest above an employer’s interest)…and here’s what we mean:
It’s important to know right out of the gate that the subject matter (and sometimes cast) of a feature film informs studios when they do their financial projections on how the film might do in the United States (Box Office/Streaming/Etc..) (domestic) and how it might do in the rest of the world (foreign). And based on the projection model, (akin to Jordan Peeler’s NOPE with African American cast and genre mashups), all studios knew that SINNERS would not do well ‘foreign’ as compared to ‘domestic’. And given the general rule that foreign revenue must contribute at least 40% to the worldwide revenue for a film’s box office to reach the mid to high hundreds of millions of dollars (foreign for Sinners will be lucky to account for 25%. (as of 5.11.25, it stands at 24%)), because of a runaway $100+million production and a $50-60million marketing spend, the film’s net profits will not translate to nearly as much for the studio as people think. All the studios knew this. Why did Warner Bros. still ignore the red light? Answer towards the end of the article.
Next up, it’s important to know that the value of an original concept/IP (Intellectual Property) is as valuable as the amount of revenue it originally generates in any and all ancillaries/outlets. This is where more success equates to more failure for Warner Bros. Let’s say Sinners worldwide Box Office exceeds $500million (which it won’t come anywhere near, but hypothetically speaking) at the BO and kills it on the streaming/rental/purchase platforms. This would be great for the studio. Right? Short term-maybe. Long term-not so fast. The net profits on the film would be overshadowed by the value of the IP (Intellectual Property) rights that will return to Ryan Coogler 20-25 years from now. How much more? We don’t know, but rest assured the IP, even at its current BO pace, will be worth tens of millions of dollars in pure profit for Coogler and perhaps a lot more. And when you throw in tv series and spinoffs and any other alternative creative choices that Coogler does not exploit while at Warner Bros.( or even if he does)-Ryan Coogler will reap a huge windfall down the road thanks to a deal that left a ton of money on the table for Warner Bros.
Which brings us to the deal-making masterminds–Mike De Luca and Pam Abdy–the co-heads of the Warner Bros. film division , who pushed the Sinners deal terms past their boss David Zlaslav. This is one of many suspect deals the pair have made during their tenure. It reeks of the sort of thing that independent producers (of which De Luca and Abdy were for many many years) in desperate search of financing for a high budget ‘high risk’ film would do when they find $90million in an unclaimed black bag dropped in the middle of NYC, figure out whose bag it belongs to, and spend every penny before conning the bag owner into believing they will treat his money as if it were their own. Whether it’s Ryan Coogler ($100+million production budget) or filmmaker Paul Thomas Anderson ( upcoming $130million production budget) or director Maggie Gyllenhaal (upcoming $100million production budget) or Wuthering Heights ($80+million for unproven director and ‘Barbi’ playing the lead)…make no mistake. Mike De Luca is all in for Mike De Luca and Warner Bros will be left holding an empty bag once De Luca is long gone.