Welcome back to What I’m Hearing, coming at you from the BofA Media in Montauk conference. I’m here until tomorrow, then on June 7, I’m doing a Manatt webinar with lawyers and executives called The Writers Strike—What Now? (register here), and on June 9, I’m moderating an I.P. Law panel at the UCLA Entertainment Symposium (register here). And, of course, I’m in your inbox Sundays and Thursdays, and your ears via The Town three times a week.

And, as always, if you’ve been forwarded this email, become a great-looking Puck member here.

Let’s begin…

• Disney’s Florida setback: Ron DeSantis has succeeded far beyond just convincing the Florida judge overseeing Disney’s self-governance lawsuit to recuse himself. Chief judge Mark Walker, an Obama appointee, actually denied the request for recusal but decided to disqualify himself anyway because a relative owns Disney stock. But now Trump appointee Allen Winsor will take over, exactly what Disney wanted to avoid by filing in the Northern District of Florida. (Read the order here.)
• Netflix’s non-binding pay vote: The Writers Guild probably shouldn’t pop champagne just yet over Netflix shareholders voting “no” on its executive pay packages. That also happened in 2019, and many of the Netflix shareholders voted before the WGA sent its scathing letters this past week targeting executive comp. But I guess it’s not not a good fact for the guild.
• Speaking of WGA missives: Can we stop with the declarations of dollar amounts that the stuck companies would need to pay to settle with the writers? Those numbers in the WGA letters are B.S.—everyone knows it’s virtually impossible to quantify how, for example, changing the residuals formulas would translate into specific dollar amounts.
• Box office over/under: Spider-Man: Across the Spider-Verse is tracking for about $85 million this weekend, which would more than double the Oscar-winning 2018 original’s debut. Still, I’ll take the over based on strong reviews, goodwill from the first movie, and the lack of Spidey in theaters in more than a year.

Now to the behind the scenes maneuvering of the summer box office…

This makes sense: Christopher Nolan is basically an unpaid brand ambassador for IMAX. He shot Oppenheimer entirely with the IMAX large-format cameras, and Universal dated the Nolan film in his usual late July slot in 2021 well before Mission 7 was dated in early 2022, following four separate Covid delays. Universal was quick to negotiate that exclusive IMAX window. But Cruise is used to getting what he wants (except an Oscar, of course), and I’m told he has expressed his extreme displeasure that the distribution waters aren’t being parted for the guy who “saved” theaters, as Spielberg famously declared. After all, Mission 7 will likely end up grossing more overall than Oppenheimer, putting IMAX in an odd spot and allowing Cruise to argue it makes business sense to give him the best screens. Cruise’s Top Gun: Maverick last year grossed $110 million of its $1.49 billion global haul in IMAX theaters, and other premium large format screens contributed hundreds of millions more to the film’s total gross. P.L.F.s and their upcharges are crucial these days to all movies, but especially to those like Mission 7 that are sold primarily as event spectacles.

But… the pile-up has already started. There’s at least one wannabe tentpole a week, starting in mid-May, with Fast X, through the DC pic Blue Beetle and the foul-mouthed dog comedy Strays in mid-August. That means far nastier competition than last summer, when Top Gun: Maverick ran roughshod for weeks. Maverick debuted in 755 IMAX screens worldwide, lost some when Jurassic World: Dominion and Lightyear debuted, and went back into IMAX theaters a month after its initial release, where it made the majority of its IMAX revenue. That was thanks to an overperforming film and a market bereft of much competition—and it’s unlikely to happen for the Memorial Day movies this year.

While most film insiders say this is a good problem—honestly, it’s fun being able to talk about high-stakes box office smackdowns again—it’s still unclear whether the post-Covid market will expand to serve all these blockbusters lined up like the circling planes in Die Hard 2. Guardians of the Galaxy Vol. 3, which enjoyed two weekends to itself, is doing fine, at about $750 million worldwide. But it probably won’t match the $864 million of the previous Guardians, and it definitely won’t reach the $955 million of last May’s Doctor Strange in the Multiverse of Madness, which had three weeks to itself before Top Gun. Guardians 3 will almost certainly end up the lowest-grossing of Marvel’s early summer releases since 2014—even without adjusting for inflation—and that year’s season-starting entry, Captain America: The Winter Soldier, was released in early April.

Similarly, Universal’s Fast X, up against Disney’s big-budget The Little Mermaid, dropped a stiff 66 percent in the U.S. in its second weekend, more than 2021’s Fast 9, which hit theaters in late June and had two weeks (and the July 4 holiday) essentially to itself. And Mermaid, which is flopping overseas but doing good U.S. business, faces a big test this weekend against Sony’s Spider-Man: Across the Spider-verse, which will be tested the next weekend by Paramount’s Transformers: Rise of the Beasts, and then Warners’ The Flash, and Pixar’s Elemental, and Indiana Jones and the Dial of Destiny, and so on. “That will be the B.O. story of the summer—how many films can the audience sustain at one time?” tweeted Jeff Bock, the Exhibitor Relations box office analyst.

Or at least a sign that the movie business is returning to whatever the new normal will be. We don’t know yet whether the week-after-week big-budget blitz will still work. And what’s certainly not as normal is the outsized cost of this summer’s tentpoles. If last year featured the first crop of Covid blockbusters—major projects like Jurassic World: Dominion and The Batman that were shut down during production—this summer features a bunch of franchise films whose budgets ballooned thanks in part to Covid protocols, which added between 10 and 20 percent to the price tag. That’s how Fast X cost more than $300 million after tax incentives brought it down from mid-$300s (well, Covid and that sprawling cast, with even minor players like Ludacris and John Cena making millions), how Little Mermaid hit $250 million—and it added an extra layer of cost, and thus risk, to hopeful franchise-extender films like Transformers and Indiana Jones, both of which could get crunched in the summer traffic jam. (Interestingly, Paramount still has a profit participation in Indiana Jones, thanks to its distribution of the previous films.)

Cruise certainly knows about Covid costs. The budget of this Mission actually rose toward $400 million, but tax incentives and a settlement of litigation related to Covid insurance is said to have brought that number down to around $290 million, as Kim Masters reported last year. Paramount chief Brian Robbins won’t care if the film delivers, of course, and buzz from test screenings ahead of its Rome premiere has been very positive, despite Paramount Global C.E.O. Bob Bakish declaring the film “too long” at an investor conference (a comment that drove Cruise crazy, I’m told). Early tracking shows a definite Top Gun Effect, with those who haven’t been Cruise fans now awakening to the pleasures of watching a 60-year-old man nearly kill himself for their entertainment. I’m certainly excited to see it.

And if Mission plays, as Cruise and Paramount hope it will, the film could go back into IMAX theaters after Oppenheimer finishes its exclusive run. But that’s an extra hurdle in a new box office landscape full of them, and it’s one that the extremely savvy Cruise is annoyed he needs to jump.

Got a question, comment, complaint, or a good Hamptons lobster place? Email me at Matt@puck.news or call/text me at 310-804-3198.