Marvel:

Resurrection of a pop-culture icon

A n d r - J o r d a n A N T O I N E
0 1 - 0 5 - 2 0 1 5

TABLE OF CONTENT
INTRODUCTION

MARVEL: THE ORIGINS

MARVELS GOLDEN AGE

MARVELS DECLINE

ON THE VERGE OF BANKRUPTCY

FROM ASHES TO SUPER HERO OF THE ENTERTAINMENT

CONCLUSION

10

REFERENCES

10

Introduction

Probably one the first things that comes to mind when talking about superheroes is the American media group, Marvel Entertainment, Inc. Recently
bought by the Walt Disney company, Marvel entertainment has created over
the years more than 5000 super-heroes and super-villains that are woven into
the very fabric of todays worldwide popular culture. From its very inception in
the 1930s, the Marvel machine succeeded in maintaining a dominant position
in the comics market in the USA, and is responsible for some of the biggest
movie success in the recent years regarding revenues from theatrical
exploitation. Nonetheless the companys history hasnt always been so bright
and Marvel provides a very good example of a successful strategy shift
operated around the production of blockbuster movies and the successful
integration with the Walt Disney Company. In the next pages we will come
back on the rich history of the firm, exploring the massive universe developed
by the creators of the firm, and see how it managed to become one of the
most profitable franchise of the decade even though the company nearly
collapsed in in the 90s.

Marvel: The origins

The history of the most famous comic book publisher in the world starts in
1939 with the creation of the publishing house Timely Comics, founded by
Martin Goodman. The first publication of Timely comics dates back to October
1939 and was named Marvel comics. Back then the magazine was
publishing the adventures of the Human Torch, Namor the Sub-Mariner,
and later on, those of Captain America (1940). During this period of war, the
adventures of captain America were a big success in the US. The fathers of
the character, Joe Simon and Jack Kirby, initially created Captain America as
a propaganda tool against the Nazis. The character was conceived as the
embodiment of the American patriotism, the protector of a free world
endangered by the tyranny of evil forces. However, the success of the series
started declining at the end of WWII in favor of more conventional stories.
The decline in sales caused by this market change eventually caused Timely
Comics to cease its activity in 1951. The different comics characters created
by the Goodman brothers kept on living through the publications of the Atlas
News Company, another publishing house created by Martin Goodman. Yet,
this decline in sales coupled with the fear of the pending creation of the
Comics Code Authority (CCA), which would have meant increased regulation
concerning comics content, especially for violent content, pushed the
publisher to diversify its publications towards more mundane subjects like
Westerns, humoristic short stories, and horror stories.

Comic book covers from Timely Comics

Marvels golden age

Well have to wait for the 60s to see Atlas coming back from limbo. At that
time, one of the main players on the comics market, DC comics, was
publishing a series called Justice league which was fairly successful. In
reaction to this, Martin Goodman asked a young employee, Stanley Lieber
(alias Stan lee), to create a new series featuring a group of super-heroes.

In collaboration with Jack Kirby, they gave birth to the Fantastic Four, a huge
hit, first published in august 1961. This famous duo of authors became part of
the most influential figures of the comic book industry and are to be thanked
for the creation of many comics characters like Spider-Man, Iron Man, The
Incredible Hulk, Daredevil, the X-Men, and the Mighty Thor.

First publications of the Fantastic Four and X-Men

Unlike their direct competitors, Lee and Kirby focused on creating flawed
heroes, imperfect characters subject to moral dilemmas, heroes to which the
readers could easily identify. That characteristic of Marvels heroes is certainly
one of the main factors that allowed the publisher to distinguish itself and
become so successful. In a matter of a decade, the creation of this super-hero
catalogue made its mark on history and pop-culture. As a matter of fact, the
60s are referred as Marvels golden age and as the silver age of comics in
general.
At that time, Marvel started ignoring the CCA, created in 1954. The code of
the CCA was meant to protect comics readers and banned graphic depictions
of violence and gore in crime and horror comics, as well as sexual innuendos.
Already largely unenforced, Marvel pushed the transgression even further and
was one of the first comics publishers to implement more mature themes such
as drugs (Amazing Spider-man #96-98) in its stories. The immediate success
of such stories spelled the end for the CCA.
The house of ideas (Marvels common nickname) was also the first comics
publisher to include minorities in its stories. The publisher supported the
African-American civil rights movement and since 1964, regular appearances
of persons of color could be witnessed in the stories, without them being
caricatured. As soon as 1966, Marvel created its first black super heroes with
Black Panther and Luke Cage.
During this golden age, ownership of the publishing house changed hands. In
1968, Martin Goodman sells his press group, Magazine Management, to
which he had transferred his comics copyrights, to the Perfect Film and
Chemical Corporation. In 1973, the Perfect Film and Chemical Corporation
changes its name to Cadence Industries and renames its press division to
Marvel Comics Group.

Marvels decline

The 70s marked a new era for the comic book. The audience was growing
and expected to see their favorite super-heroes grow with them. In the real
world, the Watergate scandal, the failure of the Vietnam War, and the peaking
crime rates in the US1 shaped the comics landscape. Stories became closer
to real life than fiction. Marvel tried to follow this trend and scripted major
events in the Marvel universe. The brutal killing of Spidermans girlfriend
(Amazing Spider-Man #121-122) by the hands of the Green Goblin, the
creation of cold blooded anti-heroes likes the Punisher, and the Wolverine,
are examples of Marvels attempts to close the gap between their content and
the expectations of the readers. Progressively the stories offered by comics
became darker but Marvel didnt succeed in establishing a strong storyline
around this trend and sales started declining to reach a low in 1972.

On the verge of bankruptcy

In 1986, Cadence industries goes bankrupt and is forced to liquidate its different
assets. Its press division (Marvel Comics) is sold to New World Entertainment
the same year. Retrospectively, this acquisition was a bad move for New World
Entertainment as three years later the same scenario repeats itself and the new
owner of Marvel Comics is forced to sell the publisher due to financial trouble.
Thus, in 1989, Marvel Comics and all its subsidiaries are sold to McAndrew &
Forbes Incorporated. This holding company owned the billionaire investor
Ronald Perelman buys the comics publisher for 82.5 million dollars. Perelman is
a successful financier but his view on the future of the company simply consisted
in acquiring it to own the Marvel copyrights and profit from tie-in merchandise.
In 1991 the holding company proceeds to Marvels IPO and uses the money
raised from the operation to diversify. The holding ends up buying numerous
companies that it will consolidate around Marvel to exploit the brand. The total
cost of these acquisitions ultimately pushed Marvel's debt to grow over $700

1 http://en.wikipedia.org/wiki/Crime_in_the_United_States

million dollars. Among those acquisitions we can mention the one of the PANINI
group for over 150 million dollars.

Still, all those events didnt stop the Marvel machine. The 90s were very
profitable for the publisher and we witnessed the creation of several animated
series that made a mark on every kid born in the 90s. Through the subsidiary
Marvel films, the firm created The amazing Spiderman, Men in Black: The Series,
X-Men, Fantastic Four, and Iron Man, some of the most successful animated
series created during that period.











Spiderman : the animated series (1994)
X-men (1992)


The group continues its diversification and becomes a majority shareholder of
Toybiz, a toy manufacturer. The exploitation of the brand through the sales of
toys and tie-in products is very profitable but the huge debt of the company is a
burden that the owners failed to alleviate. In December 1996 the firm officially
goes bankrupt for the first time in its history.

From then on a power struggle begins between Ron Perelman and Carl Icahn,
another billionaire investor who was interested in becoming a majority
shareholder of Marvel in order to impose his own board of directors to the
company. To do so, Icahn proceeded to buying back Marvels stock on the
market, thus achieving a 50% ownership in the company. In 1997 a new board of
directors was appointed.

During those years, Marvel was forced to sell some of its licenses to limit the
damages. Hence the loss of the cinematic rights of Spiderman, sold to Sony
Picture Entertainment in 1999. Among the other cinematic licenses sold, we can
mention those of the Incredible Hulk to Universal pictures, Iron Man to New Line
Cinema, and the X-Men and the Fantastic Four to the 20th Century Fox.

From ashes to Super Hero of the entertainment

The turmoil continues for Marvel and in early 1998, the SEC overrules Icahn
hostile takeover of the company, and he is removed from the board. Meanwhile,
Toybiz, led by Isaac Perlmutter, and Avi Arad, put together with Marvel, a merger
plan. The incentive behind that was that their financial situation depended

greatly from one another at that time. The merger was achieved in October 1998
and the firm is renamed Marvel Enterprises.
On the comics side, Avi Arad and Isaac Perlmutter recruit new editors to give a
fresh input on the Marvel comics universe. In 1998 they recruit James Palmiotti
and Joe Quesada. The former became a big name in the industry and remained
editor in chief at Marvel Comics until 2010. Together, Quesada and Palmiotti
created many new characters such as Daredevil, Black Panther, the Punisher and
the Inhumans. The comics activity started gaining momentum again and the
publisher started recruiting talented players in the industry such as Brian
Michael Bendis and Mark Millar, responsible for the reboot of the Avengers, and
authors of other great hits such as House of M, Avengers Disassembled, and Civil
War. In 2001 the company finally becomes profitable again and announces net
results of 30.6 million dollars, compared to a net loss of 4.6 million dollars the
past year.















Cover of House of M (2005)
Cover of Civil War (2006)




Regarding the exploitation of movies, Marvel was finding itself in a difficult
position, as it couldnt use most of its super-heroes in theatres because many
rights were sold in the 90s to cope with the financial difficulties the firm went
through. Other companies introduced the public with this new super-hero era
we are currently in. Hollywood found itself craving for super-heroes after movies
such as Blade (1998), X-Men (2000), Spiderman (2002), Hulk (2003), Batman
Begin (2005). Super-heroes quickly became box-office hits but the royalties
received by Marvel were still too low to allow the development of the Marvel
catalogue in theatres. Seeing the increasing volume of movies exploiting its
characters, Marvel decided to take things in hand, and in 2004, Marvel
contracted a 525 million dollar loan to buy-back its licenses and produce its own
movies. In 2005 the company is renamed Marvel Entertainment to mark its
orientation toward cinematography and the company successfully acquires the
rights for Iron-Man (previously sold to New line Cinema) and the rights for The
Hulk (previously sold to Universal Pictures). This is probably the key date in

Marvels new age. In 2008 the movies Iron Man is unleashed in theatres, grossing
more than 98 million dollar the first week of its release2.

Marvel is definitively saved from death. The firm had displayed positive net
results exceeding 100 million dollars for the past 7 years and the movie Iron Man
rocketed the Marvel studios at the top of Hollywood expectations. In the
meanwhile, Perlmutter, left in command after the departure of Avi Arad in 2006,
decided to organize what will be the greatest strategic move in Marvels history:
the sale of Marvel Entertainment to Disney for 4 billion dollars. This acquisition
is sealed in 2010 with the nomination of Kevin Feige as president of Marvel
Studios and Joe Quesada as Chief Creative Officer of Marvel Entertainment

Through the following years, Walt Disney and Marvel Entertainment managed to
buy-back most of the rights for Marvels characters except for the X-Men, The
Fantastic Four and Spiderman. The exploitable catalogue became rich enough to
launch more ambitious projects such as Iron Man 2 (2010), Thor (2011), Captain
America: The First Avenger (2011), and of course The Avengers (2012), grossing
more than 200 million dollars the week of its release. On average, the 11 Marvel
movies that were released so far have generated over 670 million dollars of
gross income3.

Disney didnt interfere with Marvels editorial line and understood the raw
potential that the publisher could bring. The deal was beneficial for both
companies. On one hand, Disney gained market shares and increased its profits
through this acquisition and unlocked the creative potential of Marvel by buying
back the licenses. On the other hand, Marvel could now produce its own movies
and gained access to the global distribution channels of Disney, namely the
Disney-ABC television group.

Disneys stock price (in blue) shows a +227% increase since the acquisition of Marvel Entertainment

http://www.boxofficemojo.com/alltime/weekends/

3 http://en.wikipedia.org/wiki/List_of_highest-grossing_films#Highest-

grossing_franchises_and_film_series

Conclusion

In conclusion, from Marvel Comics to Marvel Entertainment, the company
managed to endure through the decades and succeeded in becoming the creator
of the second most profitable franchise after the Harry potter franchise4. The
acquisition of Marvel by Disney didnt change anything concerning the editorial
line and strategy of the publisher. Today, the Marvel universe keeps expanding
through the comics series and the editors have kept control over the
development of their storyline. The success of the Iron Man movie saved the
studio from a certain death and allowed it to put together a cinematic and TV
universe thanks to the support of the Walt Disney Company. The studios have
planned a total of 9 movies for the next four years and TV projects staring
emblematic characters like Daredevil and Luke Cage are seeing daylight. It might
be too soon to tell but chances are that we are witnessing the second golden age
of the Marvel company.

References

Marvel Studios : lhistoire (2014), available at : http://disney-
planet.fr/marvel-studios-lhistoire

Marvel Entertainment, available at :
http://en.wikipedia.org/wiki/Marvel_Entertainment

Marvel Cinematic Universe, available at :
http://en.wikipedia.org/wiki/Marvel_Cinematic_Universe

Marvel to make movies based on comic books, Los Angeles Times (06/09/05),
available at : http://articles.latimes.com/2005/sep/06/business/fi-marvel6

How Perelman's Team Nearly Destroyed the Entire World of Comics, available
at : http://www.webcitation.org/5OlTv7USk

4 http://en.wikipedia.org/wiki/List_of_highest-grossing_films#Highest-
grossing_franchises_and_film_series

10