Blumhouse Productions CEO and founder Jason Blum talked with Recode’s Peter Kafka in front of a live audience at South By Southwest this year in a live taping of our Recode Media podcast.
You can listen to the interview in the embedded audio player below, or find Recode Media on Apple Podcasts, Spotify, Pocket Casts, Overcast or wherever you listen to podcasts. Below that, we’ve posted a transcript of the conversation, broken up into sections. Enjoy!
PK: Last week was the Oscars. This week is South By [Southwest]. What’s more fun?
That’s not fair. We had this conversation backstage, and now … The South By is less stressful than the Oscars. The Oscars are certainly more stressful.
PK: By the way, you’re here to promote your next set of movies, right? The “Get Out” phase is over, everyone’s seen “Get Out.”
We have two movies here, we have “Unfriended Dark Web,” which premiered last night.
PK: It’s the sequel to “Unfriended.”
Which is basically “Unfriended 2,” exactly. And then tonight, we have this movie called “Upgrade,” which Leigh Whannell, who wrote all the “Insidious” movies, and wrote “Saw,” directed “Insidious 3,” it’s his first original movie that he’s directed. And I’m really proud of both movies, and we’re here supporting and promoting them.
PK: Cool. I talked to you a little more than a year ago at Code Media. “Get Out” was not out yet, we showed a preview of it. I’m not the only one who had this reaction, I said, “I don’t know about that movie, it seems fine.”
Not sold.
PK: Not sold. So that was a few weeks before it came out. Did you know what you had with “Get Out”?
No, you never know … When a movie touches a cultural nerve like that, you … The only … I actually shouldn’t say that. I always say with “Paranormal Activity,” Oren knew. Because Oren would always say, “That movie’s going to be …” And obviously you want the director you’re working with to think that he’s got magic in a bottle. And every director always thinks they’ve got magic in a bottle. So that part …
PK: Let’s be clear, we’ll talk about your model …
But other people don’t know.
PK: We’ll talk about your model in a little bit. But one of the parts is, you test these things, right? You’re not just … Beause a lot of movies you don’t even bother to release, right, if they have to score a certain audience score.
I wouldn’t say, “Don’t bother to release.” We just release them in a different way.
PK: They do not go to theaters.
They don’t go wide to theaters.
PK: Right.
They don’t go to a lot of theaters.
PK: So, at what point with “Get Out” did you go, “Oh, this is a thing.”
Well, not at the test. “Get Out” tested B+/A-. It wasn’t … The scores of “Get Out” were not off the charts. We’ve had a lot of movies test higher than “Get Out.” The point that you’re asking about was the second weekend of release. So, it opened, it had a great open … It opened last Oscars, over the Oscar weekend. So it’s been over a year since it opened. And the opening was very solid but not incredible. But the second weekend was when we knew we had something. It’s when we knew we had something that was going to touch a nerve everywhere around the place.
PK: And what are you looking at? Are you looking at the numbers? Are you looking at …
You’re looking at the drop, the gross, the drop. And it dropped only about, less than 20 percent. And a great drop, especially for a genre movie, is 50 percent. So when the movie dropped 20 percent, we knew it was going to be a great, fun ride.
PK: So, Universal’s your distributor. At the point where you realized, “This is a hit,” is there anything else you can do? Or you’ve already done your work at that point?
Well, you can talk about it, immediately about it on an Academy campaign.
PK: Did you have to push Universal for that? Sounds like a maybe.
Maybe. I mean, I think it was … We didn’t really, in fairness, we didn’t think about the Academy campaign the second weekend of release. But after the story started coming out, after a month or six weeks into it, I definitely felt like we had a shot at that. And so we started thinking about it early.
The tricky thing about an Academy campaign in March is you can’t really … If anyone actually thinks you’re thinking about an Academy campaign for a $4 million horror movie that was released in February, you immediately get shut down. Right, it’s like, “Shut up with you. That’s never happening.” So you have to do a covert ops Academy campaign.
PK: And when did that pick up as a, “Actually, ‘Get Out’ could really win an Oscar. This could actually happen”?
Well, I don’t think that happened until way late. Until October, November. But the campaign started … We had little events, like, we did an event around the home video release, the digital release of the movie, which was March, April, May-ish, about three or four months after the theatrical release. And we had a kind of a big party for that, and we invited people that wouldn’t normally come to that. We brought the cast, we brought Jordan. And that definitely made people think like, maybe this movie will have a longer life than just this normal, traditional windows of the release of the movie.
PK: I was asking you, what was it like to sit at the Oscars, and you said, “Well, I tweeted.” So we can go back and review your tweets. What are the things you wanted to tweet but didn’t tweet, just between us and the internet here. What is that experience like, to sit there with a realistic chance of winning Best Picture?
I’ll tell you. I’ll tell you, I’ll tell you exactly what it’s like. So, in truth, the only thing you’re thinking about, or anyone in my position is thinking about, is the speech that you may or may not give. You have to convince yourself that you’re going to give this speech. So, in your mind, or in my mind, I’ve played out the whole thing: Where I’m going to walk, where I’m going to stand, where the microphone’s going to be. You have to imagine doing it, because you’re so nervous that you can’t think, “I’m not going to win,” because then you’re not going to be prepared.
So, in order to prepare … My poor wife, every time there was a commercial break, we’d go outside and I’d run through the speech with her. So by the time the award is called, I’ve won in my head. People say, “Are you surprised you lost?” I’m like, “Surprised? I couldn’t … I was shocked!” I couldn’t believe it. I had already won! I recorded and I practiced the speech five billion times, even before the Academy Awards, and I recorded it. I held up soap like this, and that was my Oscar. And I recorded a little video of me giving a speech, like, I’m such …
PK: You showed me a video on your iPhone, it looks great. You should share it.
I just showed it.
PK: It’s a good speech.
I want to tweet the speech, but I think it’s obnoxious. Someone said, “If you thank Guillermo [del Toro] and then tweet it …” But I think it’s still pretty obnoxious to give your Oscars speech that you didn’t get to give because you lost. But I sent it to a lot of people, so a lot of my friends saw it.
PK: So “Get Out” is this surprise hit, giant hit, really important culturally. It was — I might have this wrong — but I don’t think it was your biggest movie last year, was it? In terms of gross?
It wasn’t our biggest movie. “Split” was our biggest. “Split” did 280 and “Get Out” did 250.
PK: So who’s seen “Split”?
All right. Well, wait till you see …
PK: And everyone’s seen “Get Out,” right? So, it’s half the room. But “Split” grossed more. What does it say about the movie business — or audiences — that the movie with more cultural resonance didn’t gross as much as the one …
Well, that’s the world we live in.
PK: That’s the world we live in.
I mean, look at every other Best Picture nomination didn’t make … No one ever, they didn’t do any business, except “Dunkirk.”
But let me go back to the Oscars for one second. So, one of the things that I would share with you guys, to your question before about the Oscars, which is like, a complicated thing, is everyone says, “Congratulations! It’s so great, got four nominations. Jordan won best screenplay, he got an Oscar.” So on one level, you kind of have to, like, you have to pretend that that feels so great. Which, of course it does feel great.
PK: Should feel pretty good.
It does. But we also … You have to acknowledge the fact that we personally lost. You sound like such a baby if you’re like, “You know, it’s great Jordan won, but we lost.” You sound like such a spoiled jerk. But, to answer your question, that’s what’s going on in my head.
PK: This is why it’s fun to talk to Jason. But I did want to ask you a little bit more about “Split.”
You could go back to “Split,” yeah.
PK: Yeah, just, because I said before we came onstage, “Which of your movies should I see in advance of [our talk]? Because I’d seen “Whiplash” and I’d seen “Get Out,” but I don’t see a lot of horror movies, what should I see? You made me a personalized list.
Yes, I did.
PK: I don’t know how personalized it was, but I’m very happy.
You know it was, you could say, yeah.
PK: It was “Split.”
It was “Purge: Anarchy.”
PK: “The Gift.” “Purge: Anarchy.” “Happy Death Day.”
Right.
PK: “Paranormal Activity 3.”
Three. That was the best one.
PK: I got the three of them. But I did not … I remember that we talked about the fact that you were doing an M. Night movie, and that was going to be the big movie. But in my world, it came and went. No one I know has ever talked to me about that movie. Everyone I know is talking about …
“Split”?
PK: Yeah. Everyone is talking about “Get Out.”
Yeah, everyone talks about “Get Out.” But “Split” made more money, is your point.
PK: But, yeah. That is your model, by the way, right? It’s movies like “Split,” that may not have giant cultural resonance … Like, you’re not trying to win Oscars from it.
No, no.
PK: You’re trying to make movies for a price that do well in the box office.
Yeah. And I got asked about that a lot, now that that movie … And we did “Whiplash,” too. And now that the movie got, like, are you going to try and make … And that is, I feel that more than ever, that we’re definitely not trying to make movies that win Oscars. Now, in the same breath, I would say, when we make a movie and it gets recognized by the Awards or Oscars, that’s a great feeling. But we are not retrofitting movies to win Oscars, no.
PK: So the model is — and we’ve talked about this before, I think a bunch of people know this so we won’t belabor it. You make movies, generally for less than $5 million.
Right.
PK: Some of them go to the theaters, some of them don’t. And, you generally feel, even the ones that don’t, you can recoup your money through international sales or iTunes. So even worst case scenario, you don’t lose money on a movie.
Yeah.
PK: And then you get a lot of upside if you have a giant hit. Generally, horror or suspense.
Generally, yeah, genre. Exactly.
PK: I’ve been thinking about this since we talked last year. And we talked about it onstage as well, but I’m still confused. You’re really good at what you do. But this model also seems like a pretty straightforward model. Make movies that only cost X. Some of them will do really well, you’ll make money. Why aren’t other people trying to do what you do?
We did a … Harvard Business School, they do these case studies, and they’re doing a Blumhouse Case Study, which I’m very proud of. They have to, as part of the Case Study, they have to talk to the employees at the company. The senior management at Blumhouse. And one of the questions … And I get to edit it after. I just read a recent draft of it. And one of the most senior people at the company, who will remain unnamed at the moment, said in the thing, they said, “This model seems replicable, why don’t people replicate it?” And his answer was, “Yeah, I don’t know. It’s not rocket science.”
PK: So, I’m not the only idiot saying it, thank you.
Yeah, I crossed that out. The biggest reason it’s not replicated is because Hollywood is totally connected to ego. And ego does not allow for low-budget movies. They’re not cool. If you have … And I think it’s a real shame. It’s good for our business, but it’s bad for movies. It’s bad for the movies that we get to all see. That there’s this connection … And it’s so tied into the DNA of Hollywood, especially at the representation level. Agents, lawyers, managers, but also the artists, and everyone cannot disassociate the notion of, “If I have a hit, I should make more expensive movies.” Or, “more money is better.” And that sounds so silly and simple, but the longer that I’ve done this, I used to say maybe. It’s no question that’s why.
It’s like, the idea that you have a company that makes “Get Out,” and you’re not going to go make more expensive movies. Or, the idea that you have a company that makes as many hits as you have, and like, don’t you want to make a $100 million movie? Don’t you want to … And, I don’t want to do that, not for so many reasons. We obviously have the ability to make expensive movies. But I don’t want to do it, because I do believe that they’re just not as fun. The risk is so high, you second guess every decision. Every decision has to be run by a committee. When you make low-budget movies, you can move. And you might be right or you might be wrong. But we make a lot of movies. The reason we make a lot of movies is because they’re all very inexpensive.
And, to answer your question, I think there are other reasons, which — I don’t know how much time I want to take up on this question. But the biggest reason is what I just described.
PK: So we can spend a little more time on it. I’m assuming that one of the reasons that … I get why Disney doesn’t do this, right. Because in the very big studios, their business model is, spend a couple hundred million dollars on movies that will make a billion dollars. And that’s … “We are so big that we need to have giant out-sized hits to move the needle.”
But I would think someone else, who’s like Jason Blum, who considers himself idiosyncratic, or someone from the internet world would go, “I like this approach. It’s kind of intuitive. I don’t need to hang out in Hollywood, but I do want to fund a lot of movies.” You would think somebody else would’ve tried this by now.
Well, I could go through the individual ones. The studios don’t do it because they’re not built to make low-budget … Still, the best distribution in the world is done by studios. But it’s impossible …
PK: The machinery is built for these big things.
It’s impossible. The streamers eventually may. But right now, the streamers are over-paying talent, to compete. So if you’re going to do a low-budget movie, you’re definitely not doing a low-budget movie for Netflix. The reason people are working for Netflix right now is — I mean, Ted wouldn’t like it if I said this, but — right now they’re paying an enormous amount of money to these people up front. So streamers may eventually do it. But right now …
Also, the upside to our low-budget movies is they get a big, theatrical release. And Netflix doesn’t do that. And the other streamers don’t really do that, either. So that’s another reason. There’s another thing that you were just saying.
Oh, and in terms of individuals, I do really think it’s what I said. There are a lot of people who make low-budget movies, but that’s in between the tempo that they’re trying to get going. And it’s very different, as you know, when your business is solely focused on this one thing, as opposed to focused on it as a side business, along with this other business. And it’s really hard to give up that other business.
PK: I was thinking about the streamers and the stories that you see about them overpaying. Netflix writes big checks, Amazon writes big checks. Apple is now writing these crazy checks, or even HBO, which pays well, is going, “We can’t keep up with that money.”
I would assume that filters down to you, because part of your pitch to a Jordan Peele is, “You’re going to make this movie at a price. But we’re going to give you basic, near-complete freedom to make this movie.” And it seems like Jordan Peele could now go to Netflix and Netflix will say, “You can make a movie for a much bigger price, and you’ll still have freedom.”
It filters down to us. The market for talent, for artists making TV and movies, is super wonky right now, because it’s not correlated to profitability, so it’s much, much, much more competitive. The thing that we can still offer is a big, theatrical release, which you can’t get at any of those other streamers. But, yeah. And we can also offer, if your movie hits, you’ll do … It’s much, much, much, much, it’s seven times more lucrative to work with us than to work with them.
PK: Because we’re going to give you a piece of the profits.
Exactly. It’s many, many more times. But if your movie doesn’t hit, of course, it’s much more profitable to work with them.
PK: So when you’re pitching them, when the next Jordan …
Because we don’t pay up front. And they pay up front.
PK: Right. And the next “Get Out” comes your way … First of all, is it even coming to you? Or do you have to go grab it from Netflix, go fight Amazon for it?
We, you know, we think about that a lot. We just bought a spec on Tuesday of this week. We bought another one yesterday. You have to fight for it. You have to fight for it. Then the fight is easier, sometimes. But we have to fight for it.
PK: And your sort of ace in the hole is, “Look, you could be up for an Oscar. We can bring you to the theaters. You’re going to get buried in the Netflix queue.”
Your ace in the hole, see, that question is very frustrating. Your ace in the hole, it’s like, I’m on the phone with the guy who wrote this script that we bought on Tuesday. And I’m explaining … And the script is built for our company. It’s the movie, it can be made for low-budget, a genre like, it’s … I get it, if it’s an Oscar movie, I got to fight for my life. Because, first of all, we wouldn’t be fighting for it. But second of all, we’re probably not the company for you.
But this movie is like, if I’m on the other end of the phone, who the hell else are you going to talk to? But I’m still hearing like, “Well, I like this one, and I like this one,” and you have to … So I still have to say, “Look, we did all these things, and this is how we’ll take care of you.” And like I said, it’s easier, but they don’t just come in the door.
PK: And the flip side, right, is that Amazon, Netflix are buying stuff from you, right? The stuff that you’re not sending out theatrically goes to them, oftentimes.
Correct. We sell a lot to Netflix, a lot to Amazon. We’re actually, funnily enough, premiering a movie that … We did the live action, new live action version of “Benji.” So, there hasn’t been a “Benji” movie since the early 2000, 2001, 2002.
PK: It’s not a horror film.
It’s not a horror film, I keep getting asked that. It’s not a horror film. I can tell you why we’re doing “Benji,” if you want to hear.
PK: Yeah, I do. The dog lives.
No, no, no. It’s a fully kids movie. And the premier is tomorrow in LA, and we sold it to Netflix. And the reason we’re doing “Benji” fits to a lot of exactly what we’re talking about.
The man who invented it, came up with “Benji,” is still alive. He’s 79, 80 years old. And in the early ’70s, he wrote the script to “Benji,” brought it to Hollywood. They laughed him out of town, said get out of town. And he said, “I still believe in this.” It’s kind of like “Paranormal Activity.” Put up his own money, made the “Benji” movie, brought the “Benji” movie to Hollywood. Everyone did exactly the same thing as “Paranormal Activity.” Laughed him out of town. On the finished movie, he went back and he distributed the movie himself. The movie was like the “Paranormal Activity” of 1972. It was in theatrical release for a year. It did like, $36 million — which today is $200 million or whatever the hell it is. And the family went on to make many movies and a “Benji” TV series.
He had a son named Brandon Kemp, who’s my age. And Brandon came into my office two years ago and told me that story, and said, “I want to write and direct the ‘Benji’ movie, but I want to do it 100 percent on my terms. I and my family understand who Benji is. My family understands how to make this movie. When I go to other places, they tell me Benji has to talk now, or Benji has to do this, Benji has to do that. We know what Benji has to do, and we know you’ll protect Benji.” And it sounds so funny. And we did. And we did. And we made a pure “Benji” movie, exactly like he wanted to make. I’m very proud of it. It has nothing to do with being scary, but everything to do, but everything to do with … We have two brands. We have our consumer-facing brand, which is scary movies. We have our industry-facing brand, which is, we protect the artist.
And in this case, the artist was Brandon and “Benji.” And we gave him total freedom to work within a limited parameter, to do exactly what he wanted to do with “Benji,” which a studio wouldn’t have let him do. And that movie, we sold to Netflix. And we had to make a decision, is it better as a theatrical or better as a Netflix movie? We could’ve gone either way. And in that case, we chose Netflix, because in my opinion, that’s where kids are watching movies. It remains to be seen whether or not we made the right choice or not. But my gut is we absolutely did. And I’ll let you know next time we talk, if we did or not.
PK: All right, we’ll talk in another year.
How do you decide when you want to branch out? You make scary movies, right? That’s what you’re good at, that’s what you make the most of. You occasionally take bets, like a “Benji” or a “Whiplash.” How do you decide, “We’re going to break out of that mold here, we feel comfortable making that bet.” Because you could do it all the time, right?
No, and again, you may say I’m rationalizing, but to me, we’re making a low-budget version of “Benji.” We’re giving all the creative control to the people who created “Benji.” And that is a Blumhouse movie. Again, industry, not consumer-wise, right. “Whiplash,” to me, even the content of “Whiplash” … If there’s such thing as a Sundance or independent version of a scary movie, “Whiplash” is very scary.
PK: It’s super tense.
The way that I define, especially on the television side, we haven’t talked about that. But we have a big TV company and we make a lot of television. And the way we describe the TV company is things that scare us. So we’re doing a scripted series on Roger Ailes. Now, he scares me, so he fits in our television brand. That’s kind of how we define what we do. And I really feel like “Benji” and “Whiplash” fit in very much to the DNA of the company.
PK: There’s this constant discussion in Hollywood, and branches into tech, about going to see movies in theaters, and are we going to continue doing that, and why don’t we get to see movies the same day and date they’re released in theaters, at home. There was a lot of movement toward it recently, and then seems like that stopped now, because Disney’s buying everything and Disney wants to put their movies in theaters. How do you feel about the theater-going experience versus watching at home? Ideally, you want people to see it in the theater, right? The movies you are most excited about, you put in the theaters.
Well, I’m glad you asked. I have a very specific feeling about this. It happened, you could say, windows. It happened. Will Smith is doing TV movies on Netflix. So in my opinion, we in the movie business kind of missed the boat. We seceded control to the people who don’t have deals with exhibition. And Netflix is making 50 theatrical movies a year that aren’t going theatrically.
So this idea that we had, windows were going to collapse, and it didn’t, and we held our ground. It’s a myth.
PK: You think it’s a done deal.
That’s not my opinion. Netflix is making $100 million movies starring Will Smith, that are playing on television. So while we couldn’t figure out an agreement to let people do what they wanted to do, Netflix said, “You guys keep fighting. We’re going to give the consumer what they want. And we’re going to give them movies at home.”
I really disagree with filmmakers telling the audience they have to see a movie in a movie theater, and I think it hurt. What that did, in my opinion, is make television series much more culturally relevant than movies. It gave television a leg up, and it gave streamers a leg up. I think the notion, in 2018 or 2019, of telling the consumer where … Telling an 18-year-old where he should see what you made is preposterous.
PK: So Netflix is spending a lot of money on movies, they’re hiring Brad Pitt, they’re hiring Will Smith. But they haven’t had “Orange Is the New Black.” They haven’t had “House of Cards.” They haven’t had a big, sort of cultural hit. They’ll tell you that lots of people saw .. Or I guess, Nielsen will tell you lots of people saw “Bright.” Why do you think they struggle with movies?
They just started.
PK: It’s too early for them.
Give them a chance. In six months, in 12 months, they’re going to have that movie. It takes time. Movies, you get to the “Get Out,” or the culturals that were the hits. You have to have a slate. And in six months, they’re going to have it. Or in 12 months, they’re going to have definitely the movie equivalent of “Orange Is the New Black” or “House of Cards” on Netflix. For sure.
PK: I thought you were going to tell me, there are some kinds of movies, especially the ones that you do, that work better when they work in a theater. It’s a shared experience. That “Get Out” was a much bigger hit because people saw it in the theater. People, when they reacted to it, there’s a special alchemy there that you don’t get on your couch or on your phone.
That’s true.
PK: Okay. That’s a good podcast. I just talk to myself.
I don’t think one happens at the exclusion … I’m not saying you have to tell the kid, “You have to watch it at home.” You can watch it in the movie theater or you can watch it at home.
Listen, my entire business is built on theatrical exhibition. Totally. And that’s how our movies are monetized way more than any ancillary streaming or anything else. I think it’s a vital part of the ecosystem of the movie business. But I think it’s a shame that we, all of us, couldn’t figure out an agreement. Because what it did was give the advantage to all the streamers. They have a financial advantage, and now they have a business model advantage.
PK: The horse has left the barn. The train is out of the station.
The horse is gone.
PK: What happens to “Get Out” or “Split” if you release them in theaters and you can stream at the same time? Are they more successful? Less successful?
Right now, they’re less successful, because that would be a one-off. But if there had been … if there was an agreement across … If “Split” was treated the same way as “Avengers,” and I don’t know what the right … I don’t know if it’s three weeks in a theater and then at home. It’s certainly not three months or four months. I don’t know what the right, perfect, perfect model is. We’d have to play with it. But you’d have to play with it collectively, not with one-offs.
It’s been tried, and one-off doesn’t work. They tried it with the Universal. People have tried it in one-offs. You have to kind of get together and make an agreement that isn’t, that’s legal. And then you’d have to play with what the model is. But the model as it is now just gives streamers a huge advantage.
PK: Back to the Oscars, you were there. You saw Frances McDormand give her speech. When she said “inclusion rider,” do you know what she meant?
I have no idea, but I’m all for it.
PK: Okay. So, the rest of us, we’re all Googling “inclusion rider.” You figured out what it meant. Is that realistic?
An inclusion rider? I think is realistic. I think it’s realistic, absolutely. I actually think it’s a good idea.
PK: Do you think your talent will be asking for it?
If a director asks me for an inclusion … They’re the one who has to do all the hiring. So if a director asked me for an inclusion rider, we would do it in a second.
PK: And what do you think of … JJ Abrams has a different version of this, which is all our stuff has to have some level of diversity of production and casting, and we’re going to try to … I’ll let him speak for himself. But he’s got it sort of mandated, built in to Bad Robot from here on out.
I think actions speak louder than words. I’m not familiar with enough, with JJ’s output. But our movies, first of all, our company is 50 percent women. And if you look at our movies, they’re very, very focused on minorities and women in a profound way. And I think actions speak louder than words. So look at the people’s work as opposed to mandates for us. But I do think Ryan Murphy has a bigger company than us. His mandate that he gave, I think it’s spectacular.
PK: You spent five years at the Weinstein’s?
I spent … It keeps growing.
PK: It keeps growing? How many dog years?
It’s been about three-and-a-half years.
PK: So, in the last year … All the stories … Have you re-thought, either what you did then or how you want to behave, and how you want your company to behave going forward, in the light of that experience?
Yeah, I don’t think anyone running a company in entertainment has not re-thought the way their company has to behave. If they say they haven’t, they’re not telling the truth. Yes, we have. And we’ve concretely done a bunch of things to address our thinking on it. And you know, happily, we haven’t had any incidents at the company, but I think everyone is super mindful of it. And I think that’s a very, very positive change.
PK: I was reading a Maureen Dowd article where you said you don’t meet with actresses without someone else in the room. Does that pre-date the Weinstein stuff? The Weinstein recording from last year?
Yeah, and that wasn’t about … I don’t like to meet an actress, when I meet an actress, I don’t like to meet them alone in the room. Now I sound like Mike Pence. But I really do, I don’t do that for two reasons. I do that because I have found over the years that it’s that thing … It’s more true, I don’t discriminate like this, but it’s certainly more true of younger actresses than actresses who’ve been doing it a while. But a younger actress who feels like they have to perform and feels like they have to impress, it’s a very awkward thing for an actress to walk into your office on a general meeting.
Because the actress is saying, “See how great I am,” or, “See how pretty I am,” or whatever. It’s awkward, and you can look what I’m looking at the actress who’s 23 years old. They look uncomfortable. And as soon as you put another person … We have a woman named Teri Taylor who casts all our movies. And I found years ago, if I would bring Teri into the room, we’d just have a more productive meeting.
PK: So you’re saying it’s not a #MeToo thing. It’s not you protecting yourself from a lawsuit, or from accidentally harassing someone. But it is a #MeToo thing, it’s addressing a power dynamic, right? There’s an inherent …
It’s about addressing … It’s really a business thing. If I’m in my office with an actress, it’s because I want to work with her. It’s because I’m interested in working with her. And we’ll have a much more productive conversation about working if there’s someone else there. And she feels less pressure and I feel less pressure. And I find that it’s more productive for commercial reasons, which is what I’m having the meeting for in the first place.
PK: “Benji” is coming out. What else are you extraordinarily excited about this year?
I’m really … So our movies this year, we have “Truth or Dare,” which comes out Friday the 13th, my favorite day of the year. Sometimes there are two on that year. I always like to have a movie on Friday the 13th. “Happy Death Day” was Friday the 13th in October. I’m very, very … I hate the word excited … Proud of, eager for the world to see the movies that we’re here with. The “Unfriended Dark Web” and “Upgrade,” which we’re screening tonight.
PK: Midnight.
Midnight. Leigh Whannell is this incredible writer. He’s written so many great movies, a lot of them with us. He directed “Insidious 3,” I felt like he never got enough credit as the director of “Insidious 3,” he did such a good job.
PK: Leigh, you want to take a bow? He’s right there.
Oh, he’s right here. Buddy, you’re here. Hi, Leigh Whannell, ladies and gentlemen.
PK: Here he is.
Poor Leigh is sitting through my garbage. Thank God I didn’t see you. Anyway, I think he’s an extraordinarily talented director, and he really gets to show that in this movie “Upgrade.” So I’m really, really psyched, so I really hope all of you see it here either tonight or at the subsequent screenings.
And then, very happy about the new “Purge” movie, which we take on a new topic in “Purge” world. It’s the first “Purge,” it’s the first “Purge” that ever existed, and it just took place on Staten Island as a government experiment.
PK: Good Staten Island joke.
And then in the fall we have “Halloween,” which is amazing.
PK: Is it, you’re remaking “Halloween”?
I’m not even quite sure. Whatever I say is wrong. But I’ll tell you …
PK: But Jamie Lee Curtis is in it.
It’s a new “Halloween” movie. John Carpenter executive produced, Jamie Lee Curtis is in it, David Gordon Green directed it, Danny McBride and David wrote it, and it’s awesome.
PK: All right, I’m watching it. And then you’re going to do another M. Night movie, right?
And then we have “Glass,” which is the follow up to “Split.” So “Unbreakable,” “Split,” “Glass,” which is sick, I just saw the trailer for that.
PK: So when you do a movie like that, when you’ve got a director and it’s done really well, the budget goes up, right?
Sequels, our budgets are almost never five. Sequels, our budgets are more like 10 and sometimes 15.
PK: But you’re still holding it to a certain level.
By Hollywood standards, our sequels are still extremely inexpensive. But they’re not … The rules of our original movies and budgets do not apply to sequels, because sequels … The release rules don’t apply either. The sequels, we have a release before we start. So we know it’s going to be wide release. We have IP that we know works, and the budgets are higher as a result of that.
PK: That’s next year.
“Glass” is the beginning of January, yeah.
PK: I’ll watch it. I have more questions, but you guys can ask your own questions for Jason. We can do microphones. We’ll do a microphone. We’re recording this, so speak up.
Scott: Hey, I’m Scott Glosserman from Gathr Films. Going back to the question of why people aren’t replicating your model, you talked a lot about ego, and this ties into it. But there’s also an economic calculus, a lack of discipline, historically. Even the Morgan Stanleys of the world, who are lending the money, you typically get a big star all of a sudden who wants to be in a low-budget movie. And then everybody thinks they can just increase the budget exponentially.
So if someone like The Rock wanted to be in one of your low-budget movies, and it changes the economic calculus of the film, do you pass? Or how have you dealt with that?
We work with John Travolta, with J.Lo, with Ethan Hawke, with Patrick Wilson, Rose Byrne, we’ve had a bunch of … No one as big as The Rock.
Scott: How do you factor them in?
We don’t treat them any differently. And we’ve paid them an enormous amount of money, because the movies we’ve done with all of those people have been very successful. But they get paid exactly the same as everybody else up front, which is scale. And if they refuse to do that, even The Rock, we wouldn’t do it. We stick to our model no matter what.
Look, another answer to that question is, because Hollywood is so twisted around with money and budgets, there is this thing. And people say, you’re Roger Corman. And I love and admire Roger Corman’s work, and him. I think he’s an exceptional person. Our business model and Roger Corman have nothing to do with one another. He was making super-low-budget movies with kids who are just starting. We make super-low-budget movies with people who really know, who are very experienced, really know what they are doing. Possibly, they’ve done four movies and the last movie they did wasn’t a big success. James Wan and Leigh had done “Saw” together, and they came in my office and pitched “Insidious.” And James had done two movies for Universal that hadn’t worked very well.
I think Hollywood judges all of us, producers, writers, directors, so much more harshly for their last work as opposed to their body of work. But we work with people who really know what they’re doing, are willing to work for a cut of the profits in exchange for creative freedom. And that goes for all the actors too, in terms of paying them scale.
PK: So everyone gets scale up front, and then there’s profit sharing when there’s a hit.
Yes, and their share of the profits depends on what they’ve gotten in the past. So if you’ve never, ever been paid more than scale on a movie, you’re never getting more than scale on one of our movies. But if you’ve made $5 million on a movie, then we’re going to get you, if the movie is very successful, we’re going to get you to $5 million. And if it’s “Get Out,” we’re going to get you past $5 million.
PK: Is there a fixed percentage that you’ll distribute to talent?
No, it varies depending on what …
PK: So the overall pie. The overall pie could be …
The overall pie is fixed.
PK: Okay.
I get one piece of very, very generous pie like this. And I dole it out however I want. So I could hire all children and keep the pie. Or I can work with someone as great as Leigh, and say we’ll split the pie, and take thirds off the top.
My theory — very un-Hollywood — is I’d rather have a small piece of what I anticipate to be a much bigger pie than a big piece of what I anticipate to be a small pie. Not Hollywood thinking. Most people who had my deal would say, “I’m going to keep all of it, and I’m going to hire people who don’t have a lot of history because I don’t have to pay them anything.”
Case in point — sorry to go on on this. The reason why so many horror franchises go south is because — specific to horror, very, very specific to horror — there’s a hit horror movie. The producers or the studio or the financiers behind the horror movie says, “I got a hit. Let’s fire anyone who had anything to do with the hit, use the title, rehire people. We’ll keep more of it.” They do keep more, but generally it’s diminishing returns. That’s why most sequels of horror movies get worse and worse and worse. And where I’ve made a very conscious effort …
PK: Keep the band together.
Keep the band together. Or, James Demonaco, he wrote “Purge 1,” “Purge 2,” “Purge 3.” Now that was very expensive to do. But every “Purge” movie has gone up. “Insidious 4” made more than 1, 2 or 3. And that’s because the original people involved with “Insidious” are still very involved. Not only because we like each other, but because we’re financially incentivized to do that.
PK: You give good answers. Other questions?
A couple more back here.
Speaker 4: First off, I love your business model, because I think too many movies in Hollywood are overly developed, overly stylized.
Me, too.
Speaker 4: But I wonder, what’s keeping you from going into comedy? Because when I think of successful low-budget comedies, I think of “Caddyshack,” “Groundhog Day,” “Super Troopers,” “Bad News Bears.” What’s keeping you from branching this business model into comedy?
Name a theatrical comedy made for under $5 million in the last 15 years that’s made over $15 million at the box office. That’s what’s keeping me out of comedy. So and the reason for that, if you want my theory — it’s only my theory — is that low-budget comedy cannot compete with our movies. There’s a great place for low-budget comedy and limited releases. There’ve been tons of them. “Patti Cake$,” by the way, although it didn’t do business, is a spectacular movie. And the people who put up the money for “Patti Cake$” did great because Amazon bought it for so much money, even though the movie ultimately didn’t make that much money at the box office.
Comedy, my opinion, when you pay your $12 or $8 or $10 for the ticket, you have to have … You must have The Rock or a huge movie star or Kristen Wiig or whoever it is. Horror movies actually work better with people who aren’t super recognizable. Comedies, I think the audience wants a person that they know is really funny already in it, before they go to the Multiplex and buy a ticket.
Now, that comedian gets $10 million. Or The Rock, I don’t know what he gets, a gazillion dollars. Why would he ever work for scale when he can make all that up front anyway.
PK: Is “Superbad,” does “Superbad” fit in that category? There were no giant stars when that was made. Those guys were not giant stars.
“Superbad,” I think, was about 20 million. It’s an amusement park $20, $25 million movie. “Superbad” had scope to it. And I also think comedies, you need set pieces, you need scope. And you don’t get that for five million bucks.
PK: Other questions. You’ve sated all needs.
I’ve answered every question in the movie business.
PK: Everything has been answered. This’ll be our last question of the day.
Speaker 5: So Walt Disney says, we don’t make movies to make money. But we make movies to make money to make more movies. The horror genre has some of the highest ROI in film, and “Get Out” was pretty artistic, critically acclaimed, box-office success. So how do you balance the art of making movies with the business of making movies? And where is Blumhouse on that spectrum of maybe Relativity Media on one end, all the way to Annapurna Productions on the other end.
What was the last part? Where is Blumhouse on the spectrum …
Speaker 5: On the spectrum of, let’s say Relativity Media is the ultimate business model of a film. And Annapurna Productions is more of an art house. Where is Blumhouse on that? How do you balance art and business?
Think about it every day, of every decision we make. The way that I … I give a different answer to this question all the time, which just shows you I haven’t figured it out yet. I’m still thinking about it a lot. But I think a different way to answer the question is we do low-budget movies so that if we see something that we think is going to be great or different, we don’t have to think about how much money it’s going to make.
What low-budgets allow us to do is respond to stuff that we think is interesting and cool without having to run a model. So that’s not to say that first and foremost we need to make profitable movies to keep the lights on and keep doing what we’re doing. Because we love doing what we do. But I also think that one of the reasons the company is successful is we don’t run models. We don’t say, “I could do this, I could do this, I could do that.”
PK: Your model is your model, right. Your model is, worst case scenario, we get our money back.
Exactly. Our model is, if this doesn’t come out great, we’re going to recoup and let the upside take care of itself. And so I think that’s not exactly how we answer your question. I think Disney’s answer is a lot better than mine. But that’s because he’s Disney.
We really try as hard as we can to think about it as art and to give ourselves parameters not to let the business stuff creep into that decision-making. And then stick really, really firmly, and with a ton of discipline, to the model that we have. That’s the best answer I can give to that.
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