Worst performance at US box office in 10 years… what does this REALLY mean for filmmakers?

I am sure you have seen the headline “Worst performance at US box office in 10 years” (http://www.bbc.co.uk/news/entertainment-arts-19541737) and maybe you saw this as further proof of disaster for our industry. I asked Stephen Follows to do an analysis of this article as some of it felt a little headline grabbing to me.

Stephen is also running his Seven Step Producer workshop in a few weeks – get £40 off with the code CHRISJONES. Full site here… http://www.sevenstepproducer.com/

Over to Stephen…

As filmmakers we need to be able to understand the headlines beyond “the film business is screwed”. So let’s break it down…

1. Why were box office takings so low last weekend?
A few reasons spring to mind…

  • Cheap, unappealing movies – There were no ‘box office draws’ that could be relied upon to lead audiences into cinemas.  And the producers of these movie knew this as the budgets of the new movies were low – “The Possession” was $14 million and “The Words” just $6 million.
  • It’s an historically poor weekend – In the US the weekend after Labor Day has always been a poor time to release movies and is often the weakest of the whole year. In previous years this slot has had niche movies such as Tyler Perry’s “Can Do” and the western “3:10 to Yuma”.
  • Seasonal elements also play their part, including the good weather, the Paralympics and US Open.

2. Is this proof that the box office numbers are falling overall?
No.  We only have to look back a few months to see some huge box office weekends. In fact, 2012 had the biggest weekend opening of all time (“The Avengers”).

During the weekend just gone the box office figures totalled $52 million. Compare this with the weekends starring “The Avengers” ($250 million), “The Dark Knight Rises” ($224 million) and The Hunger Games ($204 million) and you can safely conclude that one weekend is not alone enough to draw judgement.

3. Is this proof of piracy ‘killing’ the industry?
Well, kind of. It’s certainly not proof that piracy is destroying cinema releases. But it does show that Hollywood studios are segmenting their movies more in answer to piracy. They’re reducing budgets on most movies, and ploughing more resources into their major titles (which they call ‘tent pole movies’). When these ‘tent poles’ open they become events and all the marketing encourages you to see it first. You don’t want to be the one person on Monday morning who hasn’t seen the new movie.

And this works for the Studios (The Dark Knight Rises has earned over $1 billion and The Avengers is up to $1.5 billion) but is it really better for the consumers wanting more choice?

4. What do these numbers mean, anyhow?
Much less than you might think!

The press and public often equate box office figures with success but the truth is much more complicated. A film which costs $100 million and then which ‘takes’ $100 million at the box office is not necessarily in profit.

The producers of the films will only receive a percentage of this figure as there are many deduction to be taken out of the box office before it can start going to pay back the budget.  These include VAT, the cinema’s fee, advertising costs, the prints cinemas project, distributor’s fee, sales agent’s fee, sale agent’s costs, gross-profit participants… the list goes on!

So with all those people taking money out of the box office figure how films return money?  Through their other income streams; DVD, TV (network, cable, terrestrial and library value), airlines, hotels, pay per view, video on demand, online streaming, merchandising, product placement and so on!

So just quoting the box office figure is not much use in working out profitability.

5. So what will the industry learn from this historically low weekend?
Almost nothing.  It’s not massively shocking, it doesn’t reveal much and don’t forget the industry watchwords no one knows anything.

Thanks Stephen, and remember Stephen is running his Seven Step Producer workshop in just a few weeks – £99 for two days with discount code CHRISJONEShttp://www.sevenstepproducer.com/
Onwards and upwards!

Chris Jones
My movies www.LivingSpiritGroup.com
My Facebook www.Facebook.com/ChrisJonesFilmmaker
My Twitter @LivingSpiritPix

One Response to Worst performance at US box office in 10 years… what does this REALLY mean for filmmakers?

  1. Mark September 12, 2012 at 10:33 am #

    First films were larger than life but actor led

    Then Super size me Sly and Arnie as super fit heroes They evolve into into marvel comic super hero’s who now star in effects driven extravaganzas.

    Even 007 now has to have special super powers. Indiana Jones 4 had an older indiana character fly with his whip and crash through windscreens and quip “My timing was off” his son MUTT with the power to talk to animals and swing through trees faster than cars.

    Having painted themselves into a corner where to now?

    There could be a huge opening for character led films that we all used to love and stay within the realms of believable.

    Star Wars was unbelievably believable in its genre and in so doing made the life and death struggles relevent and personal to an audience. Summer blockbusters tryi to AWE the audience by showing them the impossible. You watch EXCITED at the trailer and then bored stiff as the film plays and the in your face special effects become BORING.

    The fight to overcome obstacles by an old age pensioner (IE Harry Brown)can be more exciting than the fight between Batman and a super villain. Clint Eastwood in the spaghetti westerns showed how effective style music wardrobe and ACTING can be.

    Or comedy characters like Laurel and Hardy, Abbot and Costello. Character/Actor led horror films that DONT need to verge on video nasties. Generation films of our time are missing. Yes effects have moved things on but they should only serve the story NOT the story serve the effects.

    Maybe the demand for high quality movies could be bigger and better If the right actors, Writers, and film makers had opportunities. They don’t need much either.

    Sometimes I see a glimpse of what is missing. Michael Caine in Harry Brown. Even today his talent as an actor makes a film cinema worthy and a new director cast and crew an opportunity Where is the NEW talent?

    Spielberg was given a chance and he made Jaws. The right music. The right actors. The right story. The right promotion. Where was the super SFX? Oh yes a rather badly made shark that was terryfying thanks to the director actors music and story.

    Could that be the reason the film industry is not doing as well as it could.

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