Why does Hollywood keep making sequels? A new book explains film's obsession with the same-old stories. (exclusive excerpt)

Go to the movies any weekend and you're almost certain to find a sequel, a reboot or a film based on a book, a game or some other known property in the lineup. This year's Halloween offerings include both Saw X, an addition to the long-running Saw franchise, and The Exorcist: Believer, a sequel to 1973 hit The Exorcist. Outside the straight-forward horror genre — but terrifying in its own way — is director Martin Scorsese's Killers of the Flower Moon, which is based on author David Grann's 2017 bestseller of the same name. The movie brought in $23 million in its first weekend in theaters in the U.S., plus another $21 million internationally.

In his new book, You Are What You Watch, author Walt Hickey explains just why Hollywood's practice of churning out endless spinoffs, sequels, prequels and reboots shows no signs of stopping. Of course it's about which films make the most money, but it's not quite that simple.

As the Pulitzer Prize winner tells it, movies like those in the Rocky franchise, such as Creed and its two sequels, are more likely to hit the multiplex than an original story because they're less likely to lose money.

But back to the book, which is packed with colorful charts and graphs that illustrate the sequel phenomenon and other fascinating topics, such as what happened to the parents in Disney movies and the superpowers of characters in Marvel Comics. It also covers the subjects of how movies and TV shows influence what we name our kids, what breed of dogs we own and even where we vacation.

The following is an exclusive excerpt from the section on the prominence of sequels:

Reboots are not new. In fact, the concept of reimagining an old story is almost as old as the original stories they steal. The Aeneid? A reboot of Homer with a more likable protagonist. All's Well That Ends Well? Since this is Shakespeare, most of his material is repurposed from Plutarch as though he apprenticed under him. The US Constitution? A reboot of the Articles of Confederation, albeit an improvement on the original.

Still, the primary motivation for a reboot, a sequel, a prequel is financial. There are plenty of reasons why a director may want to return to a franchise after time away. Maybe they want to revisit the world they built and expand on it. Perhaps the themes they wanted to address could be accomplished only by getting everyone back together except Robert Duvall and then casting their daughter in a starring role. We can probably conclude that a person who spent most of their life boxing in Philly would want to confront their own looming senescence by way of a film about an underdog fighter. Maybe we really need to address exactly where the Minions were between the years 1939 and 1945?

But the real reason there are so many reboots is that they're more reliable moneymakers than original films.

This doesn't mean reboots automatically make more money than original films, though. It's a common misperception that the only things Hollywood executives care about are profits. This is not the case. The top priority of most producers is not to make a lot of money, but rather not to lose a lot of money. Nobody ever got fired for making a modest bet on a beloved franchise, but many people have gotten fired for making a modest bet on an unknown script with big potential. The incentive is risk aversion, not profit seeking.

The average original film, the kind of movie that is not built off of a preexisting intellectual property, has made 2.8 times its budget back at the global box office since 1980. That's pretty good, the kind of return on investment that puts a film in the black. It's even a little better than a nonsequel film based on a screenplay adapted from another property—a comic book, a television show, a news story, or a magazine article—which on average made back 2.5 times their budget. Your conclusion might well be that original screenplays outperform adapted material.

But the average sequel has made back 4.2 times its budget at the global box office since 1980. Sequels based on original concepts did even better, earning back 4.7 times their budgets at the global box office. This makes sense, of course. All the work done to establish the first movie rolls into the second, and as the overall cost of advertisements and reaching an audience rise, so too does the cost of promotion. But sequels give you momentum. There's a reason why the people who get to make the most original films— companies like Pixar or Studio Ghibli, directors like Christopher Nolan, M. Night Shyamalan, or Quentin Tarantino—are able to do so based only on the inherent strength of their corporate or individual brand, and in some cases at substantial personal financial risk.

But if the single best box office performers are sequels to original movies and original movies make a profit on average, why don't studios invest in new originals with an eye toward establishing new franchises more often?

It comes down to shareholders and return on investment. If your spending on an original movie nets you 2.8 times return on your investment, those dollars actually represent what you're not spending on a sequel, where you can count on an average 4.2 times return on investment. That's how investors and stockholders think, anyway. There's also the inherent risk of not earning back your budget, which perhaps a director could survive if it happened only every once in a while, but it can and does spell the end for the studio exec who greenlit the project. Just 44 percent of nonsequel films make back their budget domestically, and just 21 percent double their budgets in profit domestically, which is the rule of thumb for breakeven. Those figures are pretty much the same for both adapted and original screenplays.

Meanwhile, 66 percent of sequels make back their budgets and 29 percent double them domestically, with 92 percent of the sequel films earning their budget back globally. So, betting on a sequel has three times the odds of making back the budget Stateside.

Sure, there are some pockets that overperform when it comes to nonsequels, but you'll never guess which ones. When it comes to films that aren't sequels, spin-offs make back their budget 77 percent of the time, and remakes earn it back 58 percent of the time. Pretty much everything else is in the red compared with the average film overall.

And when you think about who is starting franchises, it's actually rare for the majors to be willing to take that kind of risk. Sure, they'll distribute them, and if you do strike gold, they'll fund the sequels, but peruse any major recent franchise and it's uncommon to find a studio that signed a big check first.

Avatar was released by 20th Century Fox, but it wasn't funded by them, with James Cameron and two private equity firms putting up the funding. The Bond franchise was started by two independent producers and is still tightly controlled by the Broccoli family. Tyler Perry had to build his own Hollywood in Atlanta to get his myriad and consistently successful franchises made. The Marvel Cinematic Universe was started by an independent, self-funded comic book company that only later was bought by Disney. And the Star Wars prequels remain the largest and most successful independent films in history, financed by George Lucas preselling the toy rights. Peter Jackson's The Lord of the Rings adaptation was the result of the director waging a vicious war with convicted rapist Harvey Weinstein to get the funding for his movies. The Hunger Games' $88 million budget was cobbled together by a studio in desperate need of a hit by preselling the international rights and getting an $8 million tax break from North Carolina.

All those improvised fundraising efforts paid off. And when those concepts are proven, the start-up is bought by a big studio, which invests directly in high-ROI sequels. The budgets for the second films in those franchises were likely assembled with considerably fewer checks. The point being that studios are disincentivized to create new things but encouraged to exploit proven properties. And as Hollywood continued to consolidate and the cost of promotion became too onerous, the inevitable result was fewer and fewer original films.

There's an obvious business incentive to make sequels and reboots, but why is one never enough? Why do audiences appear to want reboots? Why are they willing to spend yet more money to return to a place where they have already been and, thanks to digital media, can technically revisit at any time?

You Are What You Watch is available Tuesday, Oct. 24 at bookstores.

Excerpted from You Are What You Watch (Workman) by Walt Hickey. Copyright © 2023. Data visuals copyright © by Heather Jones (art) and Walt Hickey (data).