Google Spots Blockbuster Summer Movies

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Transformers: Revenge of the Fallen, the second movie in the series about robots in disguise, exploded in its debut, earning more than $62 million on its opening day alone.

The film has been out for two and a half weeks and has grossed $339 million domestically and $670 million worldwide. With a production budget of $200 million, the return on this movie is already attractive without factoring DVD sales and television rights. Paramount Pictures, the Viacom ( VIA.B) subsidiary that distributes the film, is in for a huge payday.

Predicting which movies will blast off and which will fizzle is difficult, but a free tool from Google ( GOOG) offers some potentially lucrative clues. Google Trends allows users to graph how often people search certain words, whether they're movie titles or product names. The results can serve as a gauge of consumer interest.

Based on this data, there are several potential cash cows coming out this summer. The following graph shows the search frequency for Transformers as well as other highly anticipated movies this year.

Summer Movie Google Searches
Source: Google Trends

While the search activity for Transformers has been bigger than those for any other major summer movie, interest in Harry Potter and the Half-Blood Prince has been steadily growing ahead of its July 15 release. The film is being searched more frequently than Transformers during a similar period ahead of its release. This bodes well for Warner Brothers, the Time Warner ( TWX) unit that's distributing the film.

The company has been adapting J.K. Rowling's popular children's books for the big screen. The previous film, Harry Potter and the Order of the Phoenix, cost $150 million to make and grossed $938 million, excluding DVD sales and television rights.

After this summer's release, the sixth in the series, Time Warner can look forward to two more Harry Potter films. The series' final book will be divided into two movies, milking every available dollar out of the franchise.

Bruno, the latest movie from comic actor Sacha Baron Cohen, has also been gaining interest in Internet searches. While Bruno will likely earn less than blockbusters like Harry Potter or Transformers, it was also cheaper to produce, leading to a higher return for the distributor.

Cohen's previous movie, Borat: Cultural Learnings of America for Make Benefit Glorious Nation of Kazakhstan, cost only $18 million to make and grossed nearly $262 million. If Bruno matches that success, it would be a huge windfall for its distributor, Universal Studios, a subsidiary of General Electric ( GE).

Search interest in Bruno spiked on May 31 after Cohen made a shocking entrance at the MTV Movie Awards while in character as the gay host of an Austrian fashion show. He was lowered from the ceiling, landing half naked in the lap of rapper Eminem.

The incident jolted previously stagnant search interest, which translated into box-office success. Bruno was the top movie this past weekend, taking in over $30 million. While the per-theater average is down from Borat levels, the debut was still strong.

Unlike Transformers, another film about a popular toy line, G.I. Joe: Rise of the Cobra, has failed to generate much buzz. While its release date isn't until Aug. 7, a flop would put a mighty dent in Viacom's balance sheet. The Paramount film is saddled with a weighty budget of $170 million.

Search traffic isn't a perfect science. For example, Ice Age: Dawn of the Dinosaurs has had lackluster search interest, but took in almost $68 million during its first weekend. It's on its way to recouping its costs for distributor 20th Century Fox, a subsidiary of News Corp ( NWSA).

Still, heighted online interest is a good sign of success. Look for GE and Time Warner to cash in with the premieres of Harry Potter and Bruno.
Prior to joining TheStreet.com Ratings, David MacDougall was an analyst at Cambridge Associates, an investment consulting firm, where he worked with private equity and venture capital funds. He graduated cum laude from Northeastern University with a bachelor's degree in finance and is a Level II CFA candidate.

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