Comments on: Note: Oscars Don’t Finance Films

By: tres miah

tres miah — Fri, 14 Jan 2011 04:16:49 +0000

Great breakdown Pierre. I was wondering you (or anyone else here) have heard of a company called B.D. Fox Independent?

They claim to be using a new model for better [producer's] compensation. I’d be curious to know what your thoughts are in querying them about the specifics breakdown of the films they have handled using this new model seeing that you can spot the devil in the details. Please share with Jeff.

Jeff. Have you heard of them? And, what do you think of their new model?

Thanks,

Tres

By: Craig Shell

Craig Shell — Fri, 17 Dec 2010 05:28:59 +0000

I would be curious to know if the the other independent film Crazy Hart (I use the term loosely) which received Oscars (best actor, best song) Recouped?
Production Budget 7M
Worldwide Gross 47M

By: Jeff Steele

Jeff Steele — Thu, 16 Dec 2010 01:01:38 +0000

Thanks for the detailed breakdown Pierre. The model definitely needs to change. Fortunately, change, sometimes in the form of radical, transformative shifts, is the defining characteristic of our existence.

By: Jeff Steele

Jeff Steele — Thu, 16 Dec 2010 00:51:55 +0000

Perhaps in some foreign territories. But overall, not to my knowledge.

By: ANAND VARMA

ANAND VARMA — Wed, 15 Dec 2010 22:12:42 +0000

Hi Jeff, great article again. I attended a panel of producers, distributors, sales agents and theater owners in London. Apparently their new DVD sale points are supermarket stores and they get “impulse shoppers” picking up DVD’s of racks and they love movies with “Dragons”. They indulge in price acquisition in these stores like Tescos, Sainsbury. Also in the U.K. I saw they have a flat fee territory price for a film license. No overgages, no expectations. One lump sum.
Thanks for the lovely article again.
Best,
Anand

By: Joe Orlandino

Joe Orlandino — Wed, 15 Dec 2010 22:10:16 +0000

Great analysis.

By: Pierre Lapointe

Pierre Lapointe — Wed, 15 Dec 2010 18:09:03 +0000

Great post, Jeff.

Another reminder of the reality of the marketplace and the moral of the story as you so aptly put it is so accurate and true.

Nice work.

By: Pierre Lapointe

Pierre Lapointe — Wed, 15 Dec 2010 17:57:31 +0000

Joe,
According to BoxofficeMojo, ww gross on Hurt locker is $48.6M, the numbers.com has it at $47.3M; domestic is $17M with US DVD sales of about $32M.

I have absolutely no idea how the deal was structured, but if you go a very traditional way then roughly half of the theatrical gross is what the distributor gets (excluding taxes, currency exchange, possible profit participation, etc.), ballpark figure distrib gets about $24M.

Not sure what the marketing costs were but according to bom, widest release was 535 screens. Say a very conservative $10M marketing budget including approx. $750k in prints alone (535 * $1400), then distribution fees of maybe $8M (approx. 35% of $24M), sales agency fees of about $3.6M (say 15% of $24M) and you’re left with about $2.4M (which I think is still generous and probably not even close).

The budget was $15M, but financing required was probably closer to $20M and interest continues to accrue.

Given this positive scenario (which again is more than unlikely), the production is still in the red for $17.6M.

Calculate distribution fees and expenses, sales agency commission and guild residuals for the DVD sales and yes the production is still very much in the red.

Until this distribution model changes radically, the end result will always be that the picture will never generate any “profit.”

By: BenL

BenL — Mon, 13 Dec 2010 22:09:21 +0000

@ Jeff – Great post. I really appreciate the context you put this issue in. GAP is critical to so many projects. What issues do you see for the near future regarding GAP funding?

This issue reminded me of your Robert Halmi post. Do you have an update from the bankruptcy of Robert Halmi International Entertainment that took out US Bank’s entertainment division? Is JP Morgan’s entertainment division still dealing the with aftershock? How are your predictions unfolding?

Thanks again for sharing the great insight.

By: Shawn

Shawn — Mon, 13 Dec 2010 21:47:10 +0000

This is one of my favorite articles. Thanks for sharing the inside info for all of us on what is going on. I would have never even thought about 80% of the things you brought up. I’m glad you exist. Also, I heard that the movie was not fiscally a success.