Hollywood Babble On & On #870: Whither Touchstone?

Thanks to reader ILDC who asked this question:

ILDC said... Apparently Disney is considering selling its "adult" film imprint Touchstone. Maybe it's because of different staffs, but Disney seems to be doing okay with brands like ABC, ESPN, Hollywood Records, and Marvel. Why are they so clueless when it comes to grown-up movies these days? They even seem to consider movies like Wild Hogs and The Proposal flukes, having turned down sequels.

Well, to answer this question we must delve back into the depths of history..... the 1970s and 1980s...

Back in those grey days the Walt Disney Co. was in piss-poor shape, having suffered a string of flops, flagging merchandise sales, and general malaise.  One way out was to expand their market from strictly "G" rated fare to "PG" and beyond.

However their first attempts at PG material failed on just about every level. Disney is probably the only studio whose specific "brand" actually has some sway with audiences, and those same audiences weren't buying tickets to see mature comedies and thrillers from Disney.

So the powers that be gathered and in 1984 they formed....

The purpose of Touchstone Pictures was to create a corporate identity or "brand" that was separate from Disney and capable of releasing the PG to R rated movies that Disney couldn't.  Its future looked bright when its first feature, the $8 million fantasy comedy Splash raked in just under $70 million in domestic box office, and launched the careers of director Ron Howard, and actors Tom Hanks, and Daryl Hannah. (Which got a lot of free publicity from its brief shot of Daryl Hannah's tush appearing in a "Disney movie.")

During the 1980s Touchstone Pictures and its TV division helped save the Walt Disney Company.  Their tactic was simple, get stars whose careers were either coming up, or in need of a revival, put them in a comedy or thriller that could be made for a relatively modest budget, and if they caught on, great, if it didn't, there wasn't much of a loss.

The formula was so successful that in 1990 Disney decided to do it all over again with Hollywood Pictures.

Then it all began to change, because the nature of the parent company began to change.

In 1993 Disney, it's family movie/TV biz revived and thriving, bought indie powerhouse Miramax.  Now Disney, the center of all family entertainment in North America, had 3 studios geared toward adults. (4 if you count Miramax's then genre division Dimension Films.)

Touchstone shifted its model to be mostly the distributor for Jerry Bruckheimer's productions like Con Air and Armageddon, Hollywood Pictures started to be lost in the shuffle going dormant in 2001, and Miramax chased Oscars.

Eventually Miramax was sold off, Hollywood Pictures was revived as their low budget genre arm, with some lackluster results.  Touchstone still had occasional hits, but there was a problem...

Disney didn't care about Touchstone anymore.

Disney's main business model is to make movies that kids will see multiple times in the theater, annoy their parents to buy all the related merchandise, including the DVD/Blu Ray.  

That model made it a juggernaut in the entertainment business, and if projects, like the Pirates of the Carribean franchise looked especially promising, they poached them from Touchstone for Disney proper.

Touchstone became an afterthought.

When Touchstone has hits, its Disney masters did tend to pass on sequels.  Why?  Because making a sequel to a hit movie is a pretty expensive proposition, because everyone involved will want more money.

Without the gravy of toy lines and Happy Meal deals it was better to be one-and-done and move on.

Now this policy is hurting their ability to retain talent, with most going off to other studios as soon as they can. This means that Touchstone isn't developing successful franchises on its own, and the company's output deal with Dreamworks isn't the money machine they hoped it would be. So it's not that big a stretch to imagine that they might put it on the block.

But what is the studio worth?

Well, let's look at the PROS & CONS of buying Touchstone Pictures...

PROS:

THE LIBRARY:  Touchstone has a lot of movies and TV shows in its library, some of them have a fair bit of value. 

CONS: 

THE LIBRARY:   However, a lot of them haven't aged well, and don't have that sort of intrinsic value since they're not exactly "classics" of their time. Then there's the very good possibility that Disney will simply keep the big blockbusters for themselves, and leave you with the tossed cookies.

THE DISTRIBUTION:  All of Touchstone's distribution was done through Disney's Buena Vista division. That means if you buy it, you either have to set up your own distribution, or pay Buena Vista to do it for you.  So unless Disney tosses in some sort of distribution capability with Touchstone, you'll probably be better off just using the money to start your own company from scratch, or buying Lionsgate/Summit.

I hope the answer to your question is in there somewhere. I do tend to ramble.