Getting comedies onto the big screen has become a sobering business in Hollywood.
Once one of the movie industry's most successful genres, with stars such as Eddie Murphy and Will Ferrell boasting $20-million paychecks, comedy is now among the most challenging propositions for the studios that bankroll them.
The fact that they typically aren't popular overseas — where culturally specific humor can be difficult to translate — has become a larger obstacle in an increasingly global film business. But even more significant is that comedies have been hit particularly hard by the dramatic slump in sales of DVDs, which have long accounted for the majority of profits on most movies.
DVD revenue for the average comedy plummeted 63% from 2006 to 2010, according to research firm IHS Screen Digest, compared with a 39% decline in the overall market.
"A lot of the income generated from comedies was because people were buying an enormous amount of DVDs," said Judd Apatow, one of the most powerful producers in the slumping comedy business. "That has slowed down, and where it affects us is 'What are the budgets of these movies?'"
Just a few years ago, live-action studio comedies frequently cost more than $50 million, with much of that money going to pay big-name stars and directors. The new model for Hollywood is the recently released hit "Bad Teacher." Sony Pictures spent only $19 million to produce the film. Star Cameron Diaz took an upfront payment of $1 million compared with the roughly $8 million she collected for co-starring with Tom Cruise in last year's "Knight and Day," according to a person with knowledge of the actress' compensation, who requested anonymity because of the privacy of the contract.
"Because of the weakening DVD market, even when we love the material it doesn't make sense for us to make a creatively risky or daring comedy for much more than $25 million," said Doug Belgrad, president of Sony's main film division, Columbia Pictures.
The only other option, studio executives say, is to aim for more money overseas. Animated family comedies such as "Rio" and "Kung Fu Panda" remain hugely popular around the world, but live-action ones are a tougher sell. That means filmmakers need to include creative elements in their comedies — be that in the casting, storytelling or setting — that are specifically designed to appeal to foreign audiences.
With this Friday's release of "Zookeeper," Sony is hoping star Kevin James will buck his weak track record overseas because he's surrounded with computer-generated talking animals, which traditionally have been popular internationally.
At Paramount Pictures, the studio is prioritizing comedic concepts that can play well abroad. Next May's "The Dictator," for instance, features "Borat" star Sacha Baron Cohen as a Saddam Hussein-like autocrat.
"We're trying to find comedies that travel internationally, which tend to be more physical or situational," said Adam Goodman, president of Paramount Film Group. "Comedy based on speech patterns and jokes have a harder time overseas."
Comedy can still can bring surprise breakout hits, such as this year's "Bridesmaids" and 2009's "The Hangover." The sequel "The Hangover Part II" is so far the highest-grossing movie of the year in the U.S. and Canada, with $245 million at the domestic box office.
But studios have also lost significant amounts of money in the last few years on comedies produced for more than $50 million. Such expensive disappointments have included director James L. Brooks' "How Do You Know," the Vince Vaughn-Kevin James buddy comedy "The Dilemma," the Will Ferrell fantasy comedy "Land of the Lost" and Steve Carell's "Dinner for Schmucks."
For comedy producers — those who make their living selling movie ideas and scripts to studios — the business has simply gotten tougher.
"There used to be a lot more confidence that studios could make money, and a $60-million budget for a comedy was fine," said Paul Young, a partner at comedy management and production company Principato-Young Entertainment. "Now they're buying fewer projects and putting pressure on costs."
Young said his company recently shopped a comedy project with two well-known stars, whom he declined to identify, that was expected to cost more than $60 million. Studios responded that they could buy the script only if the budget was less than $50 million, which he said was impossible given the talent involved.
As a result, he said, the project fizzled. "That would have been a slam dunk five years ago," he said.
Increasing concern about the economics of comedies has also led studios to increasingly rely on well-known names with track records. That's why Apatow, Adam Sandler and "Hangover" director Todd Phillips remain among the busiest people on Hollywood's comedy circuit.
"There's a small power elite in the comedy world who can increase the likelihood of a sale," said David Friendly, who has produced such comedies as "Little Miss Sunshine," "Big Momma's House" and "Meet Dave." "I was at lunch with a studio head who said, 'Bring me that idea with Ben Stiller and we'll do it.'"
As digital distribution becomes more popular, it could provide a boost for filmmakers who want to make people laugh. Comedy is the No. 1 movie category for video-on-demand rentals, according to Rentrak Corp. The most popular on-demand title of all time for Universal Pictures is the 2009 Vince Vaughn comedy "Couples Retreat," which beat stronger box-office performers such as "Fast & Furious" and "Despicable Me."
But the people who run Hollywood aren't giving up on big-screen comedies. The many executives and producers who grew up on classics of the 1970s, '80s and '90s like "Animal House," "Ferris Bueller's Day Off" and "Groundhog Day" say they're determined to keep the genre alive despite the challenges.
"It takes some discipline and clarity early in the process to get over the internal hurdles we have now to make a comedy," Belgrad said. "But most talent now are willing to make creative deals and producers are rising to the occasion so we can make the movies work."
Times staff writer Rebecca Keegan contributed to this report.