The identify Village Roadshow may not ring a bell with each moviegoer, however the company’s logo nearly actually will. Its shimmering, nested “V” of metallic ribbons that taper inward like a cinematic phantasm performed earlier than dozens of flicks that collectively spawned 34 No. 1 opening weekends, 19 Academy Awards, and $19 billion in worldwide field workplace gross.
The veteran manufacturing home behind seismic hits like The Matrix, Ocean’s 11, and Mad Max: Fury Highway has been delivering hits for many years, largely by coproductions with Warner Bros. However final week, following a years-long decline in field workplace efficiency, the corporate filed for bankruptcy. How did a extremely pedigreed cinematic powerhouse—the identical drive behind a few of this century’s largest movies—find yourself in Chapter 11? It’s a sophisticated reply, one which—like a number of different recent corporate downfalls—is rooted within the COVID-19 pandemic.
From the drive-in to ‘The Joker’
Village Roadshow began in Australia in 1954 as a drive-in theater operation. Over the following few a long time, it prolonged its tentacles into common theater enterprise and residential video, earlier than launching a movie manufacturing shingle: Village Roadshow Footage. True to the corporate’s Australian roots, its first-ever film, 1989’s The Delinquents, was set within the Outback and starred a younger Kylie Minogue. Just a few years later, the 1992 sci-fi flick Fortress delivered the corporate’s first hit, however Village Roadshow turned a real drive in 1997, when it entered into a co-financing and distribution partnership with Warner Bros.
It didn’t take lengthy for the Village Roadshow-Warner Bros. partnership to seek out explosive success. In 1999 alone, the team-up yielded a number of main, genre-spanning hits, together with Sopranos-adjacent mob comedy Analyze This, schlocky shark horror Deep Blue Sea, and director David O. Russell’s breakthrough, Three Kings, and the culture-shifting sci-fi epic The Matrix. Although the preliminary partnership deal outlined a plan for making 20 options collectively over a five-year interval, Village Roadshow in the end ended up collaborating with Warner Bros. on 91 of 108 complete films over the a long time that adopted, in keeping with its bankruptcy filing.
The corporate’s hitmaking period continued all over to 2019’s billion-plus grossing Joker. It was round that point, although, that Village Roadshow decided that may issue closely into its undoing: embarking on a mission to launch extra tasks independently.
“From 2018 to 2020, following a shift within the Firm’s equity-holders and change in management, the Firm expanded its enterprise mannequin and devoted a significant portion of its assets to creating the Studio Enterprise,” the chapter submitting details. Village Roadshow’s pivot to a “full service store” for creating new tasks meant taking over extra workers, forging extra partnerships, and spending extra capital on numerous offers.
It could take years to appreciate that they had bitten off greater than they may chew.
A ‘Matrix’-sized dispute
Village Roadshow’s foray into studio enterprise reportedly put into improvement 99 function movies, 67 unscripted TV reveals, and 166 scripted TV reveals. This flurry of content material creation didn’t bear a lot fruit, although. Solely six of these movies ended up going into manufacturing—probably the most outstanding of which can be Yassir Lester’s little-seen bowling comedy The Gutter—alongside 5 unscripted collection and two scripted ones. Because the submitting particulars, Village Roadshow spent roughly $47.5 million on these efforts, none of which has but to return a significant revenue. The corporate may need been capable of offset these prices with income from extra Warner Bros co-productions—had that partnership not ruptured spectacularly within the early days of the pandemic.
The Matrix Resurrections, the franchise’s feverishly anticipated fourth installment, was initially scheduled to debut in theaters again in Could 2021. However with the field workplace nonetheless sluggish and the COVID-19 vaccines simply beginning to roll out, Warner Bros. delayed the would-be blockbuster’s release to April 2022, when it stood a greater probability of performing properly. That date was later shuffled once more, although, this time as a part of Warner Bros’s controversial strategy to launch its total 2021 slate of heavyweight titles like Dune and Godzilla vs. Kong on HBO Max the identical day they hit theaters. The December 2021 launch date for Matrix Resurrections ensured it might be a part of that house viewing experiment.
Whereas the lukewarm reviews possible didn’t assist, the movie’s rapid streaming availability possible contributed to its disappointing $157 million worldwide gross—roughly a 3rd of what the unique Matrix earned 22 years earlier. Since Village Roadshow’s deal relied on theatrical income for its earnings from the film, the company sued Warner Bros in 2022, alleging it had shoehorned Resurrections into its 2021 launch slate in an effort to “create a desperately wanted wave of year-end HBO Max premium subscriptions.”
The 2 firms have spent the years since entangled in ugly, pricey arbitration. Based on the chapter submitting, Village Roadshow has already incurred $18 million in authorized charges, “practically all of which stays unpaid.” Because the authorized prices piled up and the tasks Village Roadshow developed below its personal banner devoured more money, there have been (understandably) no splashy new Warner Bros collaborations within the hopper to maintain the ship afloat.
“Even when the WB Arbitration is resolved, the Firm believes that it has irreparably decimated the working relationship between WB and the Firm, which has been probably the most profitable nexus for the Firm’s historic success within the leisure business,” reads the submitting. (Neither Village Roadshow nor Warner Bros. responded to Quick Firm’s request for remark.)
In the course of the first half of 2024, Village Roadshow Footage entered a wave of layoffs that noticed its workers downsize from 45 staff to 9. That very same yr, the corporate introduced in Goldman Sachs to discover the opportunity of a sale which may protect its manufacturing arm. However the darkish cloud of an ongoing arbitration in the end made such a sale unimaginable. The best choice, Village Roadshow concluded, was promoting off its library property—the submitting mentions an unnamed bidder providing $365 million for them—and promoting its spinoff rights individually. Ultimately, Village Roadshow determined that declaring chapter would result in a sale that maximized its property.
For a manufacturing firm with such an illustrious historical past, it’s not precisely a Hollywood ending.
