Fantastic riches and where to find them: how to grow a $22bn franchise

Fantastic Beasts is not just a new outpost for the Harry Potter empire. It is a pivotal moment in the creation of The Wizarding World of JK Rowling and it could give the gold-gobbling niffler a run for its money. We go over the books

A film franchise is like a shark: it must keep moving forward or die. Now that the goldmine of Harry Potter has been largely exhausted after eight phenomenally successful films, the baton has been picked up by Fantastic Beasts and Where to Find Them. Fantastic Beasts is not simply a new outpost of the Harry Potter empire, it is a key plank in the extension of a universe that has given itself considerable elbow room with its retooled brand-name, The Wizarding World of JK Rowling. Encompassing films, books, videogames, websites and theme-parks, the Wizarding World is one of the most valuable brands in the entertainment industry.

Conceived and written by Rowling herself (and taking its cue from the Hogwarts school textbook mentioned in Harry Potter and the Philosophers Stone), Fantastic Beasts was quickly reconfigured as a five-film series, starring Oscar winner Eddie Redmayne as its magizoologist protagonist, Newt Scamander. Rowling has set the film in the US, from where the vast majority of the Wizarding Worlds revenue has so far derived.

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Box office analysts in the US are suggesting it will open there on $75m or so, far lower than Deathly Hallows 2s $169m but Fantastic Beasts, of course, doesnt have a huge-selling series of books behind it to bolster its central character. Still, says David Hancock, senior cinema analyst for IHS, a franchise slowdown is nowhere in sight: The studios are looking to achieve more financial control over what they do. With franchises they can plan ahead: five years, 10 years.

In some ways, Potter has been the template for this: a structured series of entertainments with seemingly endless opportunities for cross-platforming and repurposing for a huge (and fanatical) fanbase. Hancock says: Without Harry Potter I dont think youd have the Marvel films, the new Star Wars series or Star Trek operating in the same way. But the films wouldnt be made without the merchandising; that can make more than the box office.

Potternomics of the $22bn wizarding universe

1. The books $8.2bn

JK Rowlings manuscript for Harry Potter and the Philosophers Stone was famously sold to Bloomsbury for a 2,500 advance; it was published in June 1997 with a 500-copy print run (most of which were sent to libraries). The following year, Scholastic published it in the US and Canada (with a change of title, to Sorcerers Stone), after paying $105,000 for the rights. The sales figures over the years have been eye-watering: Philosophers Stone is among the 10 bestselling books of all time, with 450m copies of the series reportedly sold up to 2013. The totals have been bumped up by constant reissues, box sets and adult editions, as well as colouring books, jigsaw books, audiobooks and pull-out posters; the most recent figures from AC Nielsen suggest that sales in the UK currently stand at around 270m (part of a non-US tally of around $504m). But the giant share has been in the US, which is estimated to have earned $7.7bn.

2. The films $11.6bn

Rowling had sold the rights to Warner Bros in 1999, and Steven Spielberg was initially interested; however he dropped out to make AI: Artificial Intelligence, and the job went to Chris Columbus. Seven Potter books became eight films (the last one, Deathly Hallows, was cut in two, in a franchise-prolonging move copied by Twilight and The Hunger Games). In total, the series has taken $7.7bn worldwide with the final entry, Deathly Hallows Part 2, proving most successful with $1.3bn. As a whole, the Potter series is the third most successful franchise at the US box office, behind Marvel and Star Wars. Fantastic Beasts will add to the total; and therell be short odds, if the box office holds up, on a further series of Beedle the Bard movies. More money has arrived via home entertainment DVD, Blu-Ray, streaming which is estimated at $3.9bn, as well as syndicated TV rights. NBC recently purchased the latter, giving Warner Bros $250m for the right to show all Potter and Newt Scamander films in JK Rowlings Wizarding World franchise.

3. Games $1.5bn

More than 80 different games have been licensed, including straight adaptations for PlayStation, Xbox, Gameboy; Lego Harry Potter; and Quidditch World Cup. They have shifted some 44m units in total, across all formats, with an estimated figure of $1.5bn. Early titles Philosophers/Sorcerers Stone, Chamber of Secrets have sold much better than the later ones, reflecting the upwardly trending average age of gamers, who may not be so interested in film spin-offs.

4. Merchandise $7bn

All those Dobby tote bags, character wands, and Slytherin T-shirts are the bedrock of what has been described as the Harry Potter economy. It really is impossible to quantify, given the global reach of the product, but the general consensus is that Harry can lay claim to around $7bn behind Toy Story, Cars and the juggernaut that is Star Wars.

5. Plays $650m

The two-part Cursed Child written by Jack Thorne and featuring a middle-aged Harry Potter with kids, appears to be selling over 40,000 tickets per month for its run at Londons Palace theatre, where it premiered in July 2016 (totalling, very roughly, 6m). Big for theatre, not so big for Potter. The Cursed Child book, however, has broken sales records for play scripts, with more than 680,000 going in the first three days in the UK, and more than 2m in 48 hours in the US. Current totals stand at 1.3m copies in the UK (representing 14.4m) and 4m in the US ($624m).

6. Theme parks $2bn

For decades, Disney has dominated the theme-park market, but in the last five years Universal has staged a healthy comeback after acquiring rights to The Wizarding World of Harry Potter. As TWWHP acts as a land, or a subworld, of each larger Universal resort it is attached to, its hard to directly measure its revenue. But reports suggest that since the first TWWHP opened at Universals Orlando park in Florida, the company has added $1.8bn to its revenue; this has to be set against the $250m each TWWHP costs to build, the tens of millions in licensing fees and 12% of merchanding income said to be paid each year to Warner Bros. These are, however, not the same as the Potter-branded attraction at Leavesden studios just northwest of London, where the standing sets for the films were built and much of the shooting took place; this is a separate operation, run by Warner Bros, and is technically a studio tour, rather than a theme park. Opening in 2012, it earned 57m in its first full year.

7. Pottermore $62m

The website set up by JK Rowling in 2011 is the outlier in the Potter universe. Owned and run by Rowling herself, it presented itself as an official response to obsessive fan interest in the Potter books, giving users an inside experience of TWWHP. More cannily, it is the vehicle for the digital publishing rights that Rowling kept hold of personally, and where she places material not thought consequential enough for full book publication; it was also, for some time, the only place Rowling sold ebooks and audiobooks to readers. That function has, however, been opened up, and figures show that last year its income dropped alarmingly, from 31m to 7m, for a 6m loss. The decline, apparently, was due to the end of a royalty agreement with Sony, which had been worth 24m the year before.