by Ben Fritz
Their prospects for turning into hit movies looked dubious. Certainly, they didn’t seem like a lineup that a new company starting from scratch could use to compete with the likes of Warner Bros., Disney, and Sony. No matter how savvy the financial structure, it was easy to dismiss Marvel Studios’ new aspirations as hubristic folly.
“If you needed to launch a Hollywood franchise—are those the superheroes you would really turn to?” asked a skeptical Los Angeles Times.
But luck was on Marvel’s side.
A project based on Iron Man had been stuck in development hell for years. Initially optioned by Fox in the 1990s, it was picked up in 2000 by New Line Cinema’s president of production, Mike De Luca (the future production chief for Sony). New Line went through several different writers and spent nearly a year trying to sign the director Nick Cassavetes, who was hot after 2004’s weepy romance hit The Notebook, but couldn’t seal the deal. At the same time, Tom Cruise became interested in playing Iron Man. But “interested” and “committed” are two very different things for Tom Cruise. And when a star of his magnitude is flirting with a project, all other plans grind to a halt as everyone waits to see what the capricious A-lister will do.
Even under the best of circumstances, adapting Iron Man for the big screen would be no easy feat. The character was goofy on the outside but troubled on the inside. Created in 1963 by Stan Lee and the writer Larry Lieber, with artists Jack Kirby and Don Heck, Iron Man was not technically a superhero but rather a super suit, made of metal, which allows its wearer to fly and shoot lasers and missiles. The man under the armor was Tony Stark, a weapons designer with a devil-may-care attitude and a Howard Hughes–esque lifestyle, who secretly battles self-hatred and alcoholism.
New Line’s co-CEO Bob Shaye was not a true believer. Though his executives had convinced him the character was valuable and he could see Sony’s grosses for Spider-Man films, he maintained that nobody would buy a character in a bulky metal suit soaring through the air. “I’ll never make a movie in which Iron Man flies!” he told Arad during one of several arguments the duo had. “It just doesn’t make any sense! Steel cannot fly.”
It was a typical attitude for a Hollywood producer who thought movies had to be relatable to the average non-geek and understandable for anyone not immersed in the world of comic books. But it also illustrated Maisel’s point—nobody understood Marvel characters better than the people who worked at Marvel.
So when New Line’s option on Iron Man expired in late 2005 and it tried to renew the deal, as it had done before, Marvel pounced. Arad and Maisel refused to extend the agreement, which was within their rights but certainly not standard decorum in Hollywood, where contract renewals are usually little more than a formality. New Line executives were shocked, and mad, but they had no choice.
“It was a great gift,” said Maisel.
It wasn’t the only gift to come Marvel’s way that year. After hemming and hawing about making a sequel to 2003’s Hulk, which grossed a mediocre $245 million at the box office and was panned for director Ang Lee’s overly psychoanalytical approach to the character, Universal agreed to give Marvel back the movie rights to the giant green monster, so long as it could release the film instead of Paramount.
In addition, Maisel and Feige finally prevailed upon Arad to include Thor, a Norse god who becomes a human superhero, in the Marvel Studios slate. Arad had initially been hesitant because he didn’t believe a proper film about the character, who spends much of his time in the mythological and expensive-to-produce world of Asgard, could be made within the $165 million maximum budget of the debt facility. But as Marvel’s plans accelerated and the group started discussing an idea that would leave the character stranded on Earth for most of the movie, Arad relented.
Now, instead of starting the slate with Captain America, as had been Arad’s initial plan, Marvel had options. Sure, none of them were on par with Spider-Man and the X-Men. But between Iron Man, the Hulk, Thor, and Captain America, the company at least had multiple characters with a little name recognition outside comic book shops.
To decide which film to make first, Marvel convened focus groups. But they weren’t convened in order to ask a random cross-section of people which story lines and characters they would most like to see onscreen. Instead, Marvel brought together groups of children, showed them pictures of its superheroes, and described their abilities and weapons. Then they asked the kids which ones they would most like to play with as a toy. The overwhelming answer, to the surprise of many at Marvel, was Iron Man.
“That’s what brought Iron Man to the front of the line,” said a person who helped to decide which movie Marvel would self-produce first.
Marvel executives in New York went ahead with plans for a slew of new Iron Man toys set to come out in 2008, while Arad, Maisel, and their team, including the fast-rising Feige, got to work on a movie intended to sell those toys.
Though they were technically using the bank’s money, every dollar they spent was an extra dollar they’d have to pay back, which meant Marvel Studios still had to play by Ike Perlmutter’s rules. The same scrutiny that kept employees sweltering in the summer, freezing in the winter, and retrieving paper clips from the trash meant Marvel couldn’t spend anything close to the $200 million-plus that Sony had put into 2004’s Spider-Man 2 and Fox into 2006’s X-Men: The Last Stand. Iron Man cost only $109 million—$30 million less than Sony had spent on the first Spider-Man six years earlier.
That meant no A-listers who could demand big salaries or, even more abhorrent to Perlmutter, gross points—revenue off the top before Marvel made its profits. In other words, there was no longer a chance that Tom Cruise would be Iron Man.
Jon Favreau, who had only three directing credits, none particularly big budget, and whose latest release, Zathura, had been a flop, was everyone’s first choice to direct. He impressed Arad with his knowledge of the character and his plan to balance the story’s political elements with comedy. Because Marvel wouldn’t be spending a lot on big action scenes, it was critical that the director bring energy to characters standing around talking. Favreau, who wrote Swingers and directed the comedy Elf, had proven skills in that arena.
Maisel and the Marvel executives in New York, meanwhile, liked that Favreau wasn’t particularly powerful in Hollywood, meaning that if battles over costs or creative choices arose, and they needed to push him around, they could. “We would never have a final cut director,” said Maisel. “Our movies were not the director’s fiefdom.”
Terrence Howard, who had recently been nominated for an Oscar for Hustle & Flow, was the first actor cast, as Tony Stark’s best friend, and paid the most of anyone in the film: $3.5 million. The company figured it needed one somewhat prestigious actor to attract other talent, and by putting him in a supporting role, they could spend the least amount possible doing it.
According to Marvel’s philosophy, the characters, not the actors, were the stars, and pretty much everyone was expendable. Indeed, when Howard later demanded $5 million to return for Iron Man 2, he was replaced by the more affordable Don Cheadle.
Casting Iron Man was tricky. Marvel considered Colin Farrell and Patrick Dempsey, but Feige really wanted Robert Downey Jr., whose own public struggles with addiction matched Tony Stark’s demons. Marvel certainly liked the fact that his career, hot in the 1980s, had cooled considerably and he would be a bargain. The question was whether he was worth the headache, particularly when it came to getting insurance for the film. But Downey was so eager that he agreed to audition for the role, showing up in a tuxedo and wowing everyone in the room. Marvel relented, agreeing to pay him $2.5 million (he and the rest of the cast would earn more from bonuses based on the movie’s box-office performance).
After considering making the Mandarin, a mustache-twirling Asian villain from the comics, Iron Man’s first foe, the new studio instead decided on Obadiah Stain, played by Jeff Bridges. He was less fantastical, had a more personal connection to Downey’s character,
“and saved us $10 to $20 million we would have had to spend going to China,” noted Maisel.
The first twenty minutes of the movie take place in a cave, and there are surprisingly few scenes of Iron Man flying or doing battle in his combat armor, which kept the budget down. Nonetheless, Perlmutter kept as close an eye on the script as he did on office supplies. When a convoy attack at the beginning of the movie was supposed to include ten Humvees, the frugal executive said, “No, too many, too expensive, we can do it with three.” Another scene, in which Iron Man saves villagers from a group of terrorists, was going to cost $1 million, and Perlmutter wouldn’t authorize the money until the last minute, figuring it could be trashed if costs rose elsewhere.
All of this backseat driving by Perlmutter, who became Marvel’s CEO in 2005, drove Arad insane. Arad was now head of a Hollywood movie studio. So what if he wanted to have nice offices, fly first class, and make his own decisions without constant oversight? Nobody was looking over Amy Pascal’s shoulder every moment, questioning every penny she spent. He thought the leadership team in New York didn’t understand Hollywood, and he particularly hated it when they tried to get involved in creative matters, such as the time a board member gave him notes on a script that was “boring.” Board members and other executives at Marvel, meanwhile, privately called Arad a greedy “pig” who cared more about his own ego than the company’s bottom line.
Even within Hollywood, Arad was a divisive figure. Some admired his bravado and his undeniably successful track record, while laughing at his personal eccentricities. Others thought he was a blowhard who didn’t truly appreciate Marvel superheroes and relied on subordinates like Kevin Feige to do the real work. Maisel and Arad, meanwhile, clashed with increasing frequency over creative issues, financial control, and who deserved the most credit for Marvel’s burgeoning movie business.
When push came to shove, it wasn’t a contest. New York favored Maisel, the Harvard MBA, who spoke the board’s language and, though he privately harbored an ego more akin to Arad’s than Perlmutter’s, wasn’t nearly as flamboyant and obnoxious as his rival for power.
So in May 2006, Arad quit, selling Marvel stock worth nearly $60 million and setting himself up as an independent producer who would work on, among other projects, Spider-Man sequels. He remained close to Perlmutter, his friend since the mogul took over Toy Biz in 1990, but few at Marvel were sorry to see him go. Marvel Studios was now officially the purview of Maisel, who was named its chairman in 2007.
Increasingly, though, the power was shifting to Feige, who had risen from being Arad’s bag boy to the president of production. As personally geeky as Maisel and as socially adept as Arad, but without the outwardly apparent ego of either, he made the perfect ambassador for the brand both within Hollywood and to the outside world. With Maisel and others, he plotted out what would become the Marvel cinematic universe, in which superheroes all exist in the same fictional reality. After each was established in his own film, the plan was for them to join together in a blowout Avengers-style team-up. It was Feige who came up with the scene at the end of Iron Man in which Samuel L. Jackson, as Nick Fury, first tells Tony Stark that there’s a wider world of superheroes out there.
Nobody at Marvel was yet using the term “cinematic universe,” but they knew the movies would interconnect, for creative and business reasons. Loyalty to the source material was paramount, after all, and in Marvel comic books, most of its superheroes soar, swing, or drive flying cars in New York City, where they regularly team up or throw punches at each other over misunderstandings. Marvel Studios also had the business insight, completely new at the time, that by linking movies with different characters, it could get the benefit of sequels without having to wait two or three years to reunite the same actors.
“One of the best businesses in movies is sequels because you can better predict the revenue and the costs,” said Maisel. “I knew by interspersing our characters, I was making every movie a quasi-sequel.”
At most studios, the “president of production” oversaw ten to twenty movies in a given year, with dozens more in development. He or she relied on producers like Jerry Bruckheimer or Joel Silver or Brian Grazer to handle the grunt work of spending every day on set and ensuring the films were done on time and on budget, with the original creative vision intact. Maisel, who had been around Hollywood for nearly two decades but had never before worked at a studio, thought the traditional divide between production executives and producers was wasteful and illogical. “Forget how things have been done,” he said of his approach. “How should they be done?”
And so Kevin Feige became Marvel’s sole producer. This change in the typical way of doing things appealed both to Perlmutter’s cost-consciousness (producers could easily earn millions of dollars per picture) and to Maisel and Feige’s belief that the best people to make Marvel movies were the people who worked at Marvel. The unusual arrangement was doable because Marvel had just two movies scheduled for 2008: Iron Man and The Incredible Hulk. The fledgling studio prioritized the latter project because Marvel’s deal with Universal meant it had to move ahead ASAP or lose the rights, even though Ang Lee’s Hulk had been a bust just five years earlier.
The pre-production offices for both films were located at Marvel’s Beverly Hills office, in rooms that required a key card to enter, so the company could precisely allocate costs.
Production on Iron Man went well. Shockingly so, in fact; under Favreau’s direction, Downey was improvising and adding more comedy and joie de vivre than anyone expected in a superhero movie. The recent Spider-Man and 2005’s Batman reboot, Batman Begins, were known for their darker undercurrents, but Iron Man would set a tone of almost sitcom-esque playfulness, more similar to Stan Lee’s comics in the 1960s. This differentiation would become a trademark of Marvel Studios movies, which fans loved. Sometimes, as it turned out, it was OK if superheroes had fun.
Still, Marvel executives in New York were worried. Iron Man was a big gamble in a business they knew little about. And toy manufacturers and retailers were not jumping on the bandwagon as they had hoped. Marvel Studios was an upstart with no track record, after all, and Iron Man was a seemingly goofy and not particularly popular character. Marvel tried to force companies that wanted toys tied to 2007’s Spider-Man 3 to make and stock Iron Man toys for 2008 as well, but few agreed. “We couldn’t give Iron Man away, nobody wanted it,” said one Marvel executive. “So there was not very much merchandise on the shelves for the first movie.”
Marvel’s business plan to break even on the movies and make big profits from toys was not looking promising. Iron Man would actually have to be a hit at the box office. But initial projections called for it to gross only $100 million in the United States, which meant it would make barely any money.
But as Iron Man‘s May 2, 2008, release approached, expectations grew. A trailer at Comic-Con in 2007 convinced fanboys that Iron Man would be a pitch-perfect adaptation of a character they loved. Later, more mainstream advertising began to draw in a broader audience interested in a big action movie with robots, tanks, and visual effects. To others, Iron Man looked like a fun romantic comedy with two actors who had great chemistry: Downey and Gwyneth Paltrow, who surprised many at Marvel when she agreed to play the love interest, Pepper Potts, at an affordable salary.
The movie was such a huge deal for Marvel that the obsessively private Perlmutter, who never gave interviews to the press or allowed himself to be photographed, showed up at the premiere at Hollywood’s Chinese Theatre. He wore glasses and a fake mustache so no one would recognize him.
The opening weekend ended up blowing away everyone at Marvel and throughout Hollywood. Its $99 million domestic debut was the second highest ever for a non-sequel, behind only Spider-Man. Its $97 million launch overseas was spectacular as well.
Not coincidentally, Marvel scheduled its quarterly earnings call for the Monday after Iron Man opened. The company raised its profit and revenue projections for the year and announced
it would release Iron Man 2 in 2010. Its stock jumped 9 percent in a single day. The movie would ultimately gross $585 million globally and generate more than $100 million in profits, not to mention spurring toy companies to finally jump on the bandwagon and make Iron Man a popular action figure.
Perlmutter was so thrilled, he allowed Maisel to buy Downey a Bentley and Favreau a Mercedes as thank-you gifts.
Iron Man‘s success more than made up for that July’s Incredible Hulk. The result of Marvel’s most difficult production right up to the present, the second Hulk film starred Ed Norton, who proved a terrible fit for Maisel and Feige’s philosophy that studio executives should be the ultimate creative authority. Undeniably one of the best actors of his generation, Norton is also famous in Hollywood for being “difficult” and highly opinionated, refusing to allow artistic choices he disagrees with and seeking to rewrite scripts he doesn’t like, which is what he did on The Incredible Hulk.
The clashes intensified in post-production, and the director, Louis Letterier, sided with Norton over the studio. They both learned who has the ultimate power at Marvel, though, when Feige took control of editing. He excised many of the darkest scenes, including a suicide attempt meant to portray how much the scientist Bruce Banner wants to rid himself of the curse of transforming into the Hulk when he’s mad.
The resulting movie was still darker and more dramatic than any other Marvel Studios production and not different enough from the Hulk movie of 2003. It grossed only $263 million at the box office and barely broke even, the worst performance for any Marvel Studios film to date.
The Incredible Hulk never got a sequel, but the character has returned in Avengers films, played by the easygoing Mark Ruffalo. The usually cheerful Feige stated that the decision to recast the role was “rooted in the need for an actor who embodies the creativity and collaborative spirit of our other talented cast members.”