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Smurfs Buoy Sony With Their Blue Movie

The blue stars of the unlikeliest box-office hit of the year may have made some serious enemies on Wall Street, but they have bolstered the fortunes of Sony Pictures.

Actors dressed as Smurfs on the floor of the New York Stock Exchange during morning trading on July 29 promote the film 'The Smurfs in 3D,' before markets went into a tailspin.
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Actors dressed as Smurfs on the floor of the New York Stock Exchange during morning trading on July 29 promote the film 'The Smurfs in 3D,' before markets went into a tailspin.

When a group of actors dressed as The Smurfs gleefully rang the opening bell of the New York Stock Exchange at the end of July, the US markets went into a tailspin in the days that followed.

But while traders may see the Belgian cartoon characters as harbingers of economic doom, Sony Pictures Entertainment, the studio that released The Smurfs movie last month, has been laughing all the way to the bank.

The film passed $425m in global box-office receipts in the past few days, while this weekend was the fourth in succession that The Smurfs was the highest-grossing movie in countries outside of the US.

The international market used to be an afterthought in Hollywood but more than two-thirds of The Smurfs’ takings have come from outside the US. The film opens this week in Scandinavia and the Middle East and will hit screens in Italy and Australia this month, ensuring that the studio will earn a hefty return on its $110m production budget.

The Smurfs is notable for its lack of big-name stars but its success means Sony Pictures has a new family franchise on its hands. Michael Lynton, chairman and chief executive of the studio, told the Financial Times the company planned to release a sequel in 2013.

“The Smurfs shows that we can make big family movies,” he said in an interview. “We’ve made family films in the past but never had one [that has performed] to this level, and not internationally.”

“The economics of the family business is better than other types of movies,” he added. “You don’t necessarily need to have big stars and the multiple between the film’s opening weekend and its total performance is much bigger [than a non-family film].”

Hollywood was initially dubious that a family film based on obscure comic book characters could succeed. “There’s always been a snooty factor for movies like these,” said Brandon Gray, chief executive of Box Office Mojo, which tracks film performance.

Paramount Pictures held the rights to The Smurfs but never made a film. But when 20th Century Fox scored an unlikely hit with Alvin and the Chipmunks in 2007, Mr Lynton, a Dutchman who grew up with The Smurfs and Tintin, thought a film based on the characters could work.

Paramount then sold the rights to Sony . “[Paramount] had an opportunity to come in on the international distribution [of the movie], which they chose not to do,” said Mr Lynton.

Sales of Smurfs-related merchandising sales have gone well, according to Mr Lynton. “Everyone underestimated it at retail but it all sells out so you don’t know what the true potential could be.” One of the benefits of making a sequel is that the studio knows a second movie – and its related merchandise – would have a ready-made audience, he added.

Sony has made another international bet on a family film this year, having acquired the international distribution rights to the new Tintin movie being made by Steven Spielberg and Peter Jackson. The studio will also distribute the next two releases from Wallace and Grommit creators Aardman Animation: Arthur Christmas and Pirates.

“It shows our commitment, that we really want to be in [family film] business,” said Mr Lynton. “It was important with The Smurfs that we made something that succeeded around the world so we can turn this into a big business for us.”