Film Printing

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How can a Hollywood film be considered a success or failure at the Box Office?

Let's say a Hollywood film costs 100 Million Dollars to make, we all know that in order to break even it would take more than 100 Million dollars worth of ticket receipts, but I really don't have an idea about the exact percentage to surpass in order to create profit from sales...Care to explain how the Hollywood industry works?

It's complicated. First, they give half of ticket price to the movie theatre that shows the film.

But U.S. ticket sales are only a small part of the overall profit picture. First, there's overseas box office, which for action films can often be larger than the U.S. returns. Then there are sales of related merchandise such as souvenirs, posters, books, toys, costumes, etc. Then, once the movie leaves the theatres, it follows a route that includes DVD, Blu-Ray, pay-per-view, premium cable TV, Netflix, broadcast network TV, local TV channels... with each stop paying a handsome profit to the studio.

But out of that comes the cost of making the movie, the cost of advertising the movie (which can be huge), the cost of making film prints, taxes, shipping, etc. The initial costs are so high that it's not uncommon for studios to actually lose money at the theatres, even with successful films, but then make it back via home entertainment. In recent years, studios have made five times as much profit from home entertainment (DVDs, etc) than they have made from theatre ticket sales.

So the profit for a film varies widely from movie to movie depending on a number of factors: Does it appeal to foreign audiences? Is it the kind of film that inspires people to buy merchandise? Will people want to buy it at home on disc? Will the networks want to air it? A family-oriented action film, such as the Harry Potter franchise, scores on almost every front. But other films, including excellent dramas which are considered Oscar material, such as "The Artist" or "Black Swan" or "The Social Network", often don't do as well. People admire them, but they don't run out and buy action figures based on the movies, or pick up copies of the video for their kids to watch over and over. So their profit potential is limited, despite their quality.

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