Critically acclaimed at its release and considered a benchmark for sequels thirty years later, Terminator 2 is considered a classic of Western cinema. Originally released on 3-7-1991 in the United States and on 16-8-91 in the United Kingdom, it generated little controversy, but it did raise concerns within the film industry as it approached release. If it proved to be commercially successful, there were worrying ramifications for the future of filmmaking. Arnold Schwarzenegger’s (1947-) character had turned from villain to hero in the storyline of the film, but would Terminator 2 be a villain the film industry would rather avoid?

Approaching release, Terminator 2 was seen as a potential blockbuster in the summer of 1991. In the months between Memorial Day (24^th May) and Labor Day (2^nd September), film studios would make 40% of their annual revenue. 1991 was going to be a competitive summer, with 51 major releases compared to 31 the previous year. In the early summer, Robin Hood: Prince of Thieves took $57 million in its opening two weeks; City Slickers took $47m in its first three; Thelma and Louise had been a sleeper hit. 1989s summer success had been Tim Burton’s Batman, which grossed $200 million, and many wondered if Terminator 2 could break the record.

It would release during a dark patch for Hollywood. The previous year, big expensive sequels had been outperformed by smaller films. Die Hard 2 (1990) had been moderately successful, as had Days of Thunder (1990). Problems at major studios, including Paramount and Colombia, effected their releases. Even Disney films were struggling to gain traction. There were predictions of a financial crash in Hollywood despite greater global markets and home viewing options increasing revenue streams.

Despite these worries, cinema chains hoped Terminator 2 would be the saviour of the summer. It could drive box office sales, prove that sequels and big stars could still be commercially successful, and challenge the monopoly of the big studios. With the opportunity to set new records and generate unprecedented revenues, why were some worried the impact would be negative?

Commercial success and the filmmaking industry: the impact

If Terminator 2 was going to make its money back, it would need to break the record. Including advertising and promotion, the cost of the film was estimated to be around $125 million (£74 million). This was the first concern: if it were commercially successful, it could encourage studios to focus too much on big budget action films, seeing an ‘easy win’ formula that could replicate the success each year. Another commercially successful action blockbuster could be disastrous, stagnating the output of studios in attempt to make easy money.

The rise of big budget special effects films could start a wave of spiralling costs. In 1991, the average film cost $26.8 million to produce and around $22 million in global marketing: only 30 would make over $20 million at the box office. If films like Terminator 2 were financially successful, it could encourage the industry to become economically irresponsible. Terminator 2’s production company Coralco were criticised for their free-spending approach to making films, offering exorbitant wages to actors, and operating with significant debt. Cynicism among investors led to fluctuating share prices, and their expenditure on global promotion ballooned costs. Success could set an example resulting in more studios and production companies becoming financially negligent.

At the time, their business model was as innovative as it was risky. On one hand they relied heavily on high grossing, big budget successes for revenue (exemplified by their previous income from 1982’s Rambo: First Blood and 1990s Total Recall). On the other hand, these high grossing films funded straight-to-video releases and promotion in international markets for the blockbusters, increasing the income they could generate. Their innovation was combining action-led, dialogue-light movies that could easily run in non-English speaking markets with broad international distribution networks that could sell them effectively.

It could also increase expectations among the audiences which would drive up the cost of filmmaking. Terminator 2 had shown it was possible to deliver advanced special effects and post-production on a schedule, which previous attempts had failed. This caused two problems. Firstly, audience expectations on post-production could push companies into ever greater costs, further destabilising finances. Secondly, the special effects were central to the film, putting it at risk of financial failure if they were not well received. These two problems combined into a larger issue around risk and reward, and whether studios would increasingly gamble on higher costs of new effects techniques on unpredictable returns.

There were concerns over the wider social impact as well as economics within the industry. The Entertainment Research Group monitored the content of films to determine if the rating accurately and sufficiently managed the expectations of potential viewers. They believed films were becoming more graphic, but the ratings were not adequately reflecting the trend. The UK’s British Board of Film Classification agreed that information provided with ratings was too vague, and this transatlantic trend was worrying as graphic content seemed to make film more popular (and therefore commercially successful). As a result, filmmakers would be encouraged to make increasingly graphic films, and it was in the film industry’s interest to make sure ratings did not reflect it, exposing more people to potentially negative influences.

­Given Arnold Schwarzenegger's political aspirations, Terminator 2 also fit into the ongoing debate around films and political influence. There were concerns popular films could spread political ideologies and influence voting in the upcoming elections, especially as Arnold’s endorsement of George Bush was cited as a contributor to his presidential victory[1]. The two blockbusters of the summer were political: Robin Hood: Prince of Thieves was a vehicle for Kevin Costner’s liberal views, and Arnie’s Republicanism is reflected in the Terminator as a defender of American liberties.

Despite the concern that films could spread ideologies to an unknowing public, the overall lack of response to Hollywood’s apparent agenda showed it to have little validity. Surveys and polls had shown a rise in right-leaning attitudes in America through the eighties, despite Hollywood’s dominant left-leaning sentiment, having increased its anti-corporate, anti-militarist, pro-LGBTQ output.

While the ideology of a film may have little impact, the rising influence of individual actors might. The star’s politics could become more prominent in a film than those of the writers, and as stars became increasingly politicised and outspoken it could move the film industry deeper into political influence, for better or for worse. Arnie already had significant power when it came to his films. He could decide the director, signing off on Paul Verhoeven (1967-) as the director of Total Recall having previously turned it down, only agreeing to that film because he got to decide the director. His decision to be in a film could influence a company’s decision to buy the script and rights: Carolco bought both for Total Recall because Arnie wanted them to. Terminator 2 took seven years to arrive due to Arnie’s lack of desire to work with Hemdale again, the company that oversaw the first Terminator film. Arnie told Carolco to take advantage of Hemdale’s fragile position to get the rights so a second Terminator film could be made.

As the star was the draw rather than the film itself, studios would have to placate the actors and actresses they wanted to play lead roles in their films. Films were increasingly vehicles for the stars, meaning the tone and message of the films themselves would have to change to mirror theirs. As Terminator 2 was a vehicle for a Republican with overt and public political aspirations, the film might not follow the left-leaning Hollywood mould, and there was concern that a widely seen reflection of Republican ideals could turn the tide of votes in the upcoming election.

As it approached release outside the United States, the link between politics and star power gained prominence as a talking point. Terminator 2 was not a success because of big production budgets, special effects, or stunt work: America had paid over $100m to see Arnie. Arnie’s place in Terminator 2 was likened to an event during a politician’s campaign, an opportunity to craft their public identity. Terminator 2 could set a dangerous precedent for stars controlling films, demanding greater input into elements beyond the production, such as advertising and merchandising. Films could become little more than a means to an end for actor’s public status and image.

Terminator 2 did not outperform Batman’s opening day, but it did break box-office records in the U.S. for the first five days. It took a record $52 million ($32 million), beating 1989’s five-day record set by Back to the Future: Part II ($43 million). Carolco’s shares fell though, dropping to levels seen when the company was first floated in 1986. Despite this, it looked like it would be successful. $91 million had been gained in distribution rights, and the share of box-office payments suggested that it could recoup (and possibly make profit on) the estimated $100 million production cost.

What is the legacy of T2 30 years on?

The film industry still relies on major summer blockbusters for commercial security, and film companies still rely on big revenue releases to cover the cost of smaller films for more niche audiences and the films designed to appeal to awards juries. Terminator 2 helped Carolco in 1991, but their business model reached its inevitable end. Four years after Terminator 2 released, Carolco filed for bankruptcy and closed in 1995. Running in constant debt and relying on big-budget films to return huge revenues caught up with them, and failed mergers left them financially fragile. Although it did not change the film industry, it did serve as a warning that the high risk-reward model was not sustainable as a long-term practice, especially for the challengers to the big studios who could absorb such losses.

Its success did encourage studios to keep faith in sequels and the draw of leading stars, starting the trend toward franchises and the multiverses we see thirty years later. Since the turn of the century, it has become a common expectation for a film to be released solely to test the audiences desire for a multi-film series. The major companies will go out of their way to purchase the rights to intellectual properties solely because they can make multiple films (and extensive merchandising) from them, notable examples being Harry Potter and the various Marvel and DC properties.

Seeing this as a negative result depends on an individual’s love of the franchise in question. Poor quality films can make huge financial returns if the IP is popular enough. It is harder to argue that the increase of lazy cash-in films is a positive outcome. Many franchises outstay their welcome, becoming long-running conveyor belts of new additions made purely to take advantage of an IP’s popularity for as long as possible. The Terminator has become a franchise and fallen foul of the result: diminishing returns in revenue and increasingly poor critical reception as more cash-in’s get released.

It certainly raised the bar for special effects and post-production, and it set expectations higher for audiences. Special effects and post-production techniques have become part of a film’s promotion, and multi-million subscribed YouTube channels are dedicated to analysing successful and failed special effects. In a major industry shift, the quality of post-production can severely impact a film’s reception if they are not up to the expected standard.

It is debatable if the influence of stars has come to pass, and no one has achieved it to the degree attained by Arnie. This is likely due to the landscape of film production over the past thirty years, which has changed significantly. It is increasingly dominated by mega-companies formed through mergers and acquisitions, making it very difficult for any actor or actress to be able to overrule or influence them. Some stars like Tom Cruise managed to gain levels of control over their films, but the trend has reduced over time.

Of all the commentary at the time, one outcome is clear: it helped Arnie build his public persona and formed part of his long campaign to successfully enter politics. While the idea that films could help shape elections and swing votes through ideological spread continues to be viewed with skepticism, the ability of stars to use films as vessels for their own social and political profiles has inarguably increased. Rumours have circulated that Dwayne “The Rock” Johnson might launch a presidential bid, and many notable actors and actresses have challenged the political establishment, including Harry Potter’s Emma Watson on women’s rights and Star Wars’ John Boyega during the Black Lives Matter movement.

Some concerns for the industry did prove valid. Films are increasingly vehicles for stars who use them as platforms to enter bigger debates and social arenas. The cost of making films has increased, and the studio reliance on big, special effects-filled blockbusters to cover the cost of smaller projects has not diminished. Audience expectations for high-quality post-production often overtake the story of a film as the center of attention as technology improves, and the ‘easy win’ of sequels for existing properties has evolved into the battle of multi-film franchises conceived as such from the outset.

Broader industry issues are still unresolved, and thirty years later films such as Terminator 2 are still mentioned in the debates. Film ratings are still contended and debated, especially as the limits of graphic content are still pushed. The ability of films to influence social and political discourse is still questioned, though it has receded into the background as video games have become the focus of this conversation. Whether or not Hollywood has maintained its left-leaning position or steadily moved more in line with social trends is also debatable. It is still quick to distance itself from anyone who crosses lines deemed risky, but studios willingly change the presence of black actors on promotional materials for different parts of the world.

The legacy of Terminator 2 is mixed. In some ways it was a hero the film industry needed, bringing in significant revenues and setting some new standards in filmmaking. It was also a villain, as some of these standards continue to be problematic three decades later. It contributed to changes within the industry that have had a mixed reception, most notably the content of the film becoming secondary to the stars in it. Like the Terminator itself, it sits somewhere in the middle: an antihero that caused damage for its version of the greater good.