James Bond distribution rights a licence to thrill film studios

The distribution rights to James Bond, one of the most high profile franchises in Hollywood, are to go up for grabs.

James Bond: Spectre. Picture: Metro-Goldwyn-Mayer Pictures/Columbia Pictures/EON Productions

The distribution rights to one of the movie industry’s highest profile franchises are about to go up for grabs, leaving Hollywood shaken and stirred.

Following Spectre — which opens this week — the current deal for Sony Pictures Entertainment to release James Bond movies will expire. Several studios are planning to pursue those rights, according to sources, even though there is surprisingly little profit in releasing Bond films.

For the past decade, Sony has distributed the 007 films under a deal with co-owners Metro-Goldwyn-Mayer and Danjaq, a British company run by the family that has produced 24 of the 26 films in the series since the 1962 original, Dr No.

MGM makes movies, but no longer distributes them to ­theatres, so it needs a major studio partner.

All four Bond films released and marketed by Sony have performed well, with 2012’s Skyfall grossing $US1.1 billion worldwide, the highest ever for the series.

But not much of the profit has stayed with the studio, thanks to what Sony’s former movie chief described in an email leaked last year by hackers as “a one-sided deal with MGM”. Sony made just $US57 million on Skyfall, according to another document released by the hackers — a small sum for a movie with such a huge box-office performance.

MGM made about $US175m while Danjaq, headed by producers Barbara Broccoli and Michael Wilson, made $US109m, according to the same document.

Spokeswomen for MGM and Danjaq declined to comment.

Since Walt Disney acquired Lucasfilm, producer of Star Wars, in 2012, James Bond has been Hollywood’s biggest movie brand not controlled by one of the six major studios.

In an industry where megafranchises and megaprofits typically go hand in hand, the question is how major studios will view an opportunity to gain the former without the latter.

Whichever distributor wins the Bond rights will gain prestige but have to devote resources that would otherwise go to potentially more profitable films it owns.

Warner Bros, Paramount Pictures, and Twentieth Century Fox are all interested in releasing ­future Bond films.

A Sony spokesman said it, too, wants to continue its relationship.

“Bond is one of the most enduring franchises in film history and we have had great success with it,” the spokesman said.

Under its current deal with MGM, Sony funds half the Bond movies’ production budgets, as well as the advertising costs, and then gets 25 per cent of the profit after recouping those costs. MGM keeps the rest of the profit while Danjaq receives a hefty portion of the films’ revenues. Along with its disproportionate share of the profits, MGM retains television and home-video rights.

In the same leaked document, a Sony executive projected that if Spectre were to cost $US250m ($352m) to produce and repeat the same box office as Skyfall, Sony’s profit would be $US38m.

The budget for Spectre is just under $US250m, said a person close to the movie, compared with $US209m for Skyfall. For the Bond movies’ theatrical distributor, there are benefits beyond the small but near-certain profits, however. Having a billion-dollar-grossing film on its slate helps a studio to negotiate more favourable terms with movie ­theatres and other partners and to attract top creative talent.

“In addition to a nice profit, it’s a great calling card and gives you increased leverage,” said an executive at one of the interested studios.

Further complicating Bond’s future, star Daniel Craig has given conflicting indications in interviews whether he will return in future instalments. A spokeswoman for the actor couldn’t be reached.