Entertainment Business News
Hi Folks,
Miscellaneous musings on the business of entertainment .
A) Something that I had always thought about to be true. There is REALLY NO CORRELATION between marketing dollars and end results (of course I may add, at a high level, there is a huge correlation from the low to high level). Here are some stats posted by Variety, which reveal just that:
Films with the biggest ad budgets in 2006:1. Cars (BV)
Total spend: * 53.5
Domestic B.O.: * 244
Ad spend as % of B.O.: 22%2. Superman Returns (WB)
Total spend: * 45.5
Domestic B.O.: * 201
Ad spend as % of B.O.: 23%3. The Departed (WB)
Total spend: * 44.7
Domestic B.O.: * 132
Ad spend as % of B.O.: 34%
4. Happy Feet (WB)
Total spend: * 44.3
Domestic B.O.: * 198
Ad spend as % of B.O.: 22%
5. Casino Royale (Sony-MGM)
Total spend: * 44.3
Domestic B.O.: * 167
Ad spend as % of B.O.: 27%
6. Poseidon (WB)
Total spend: * 43.4
Domestic B.O.: * 61
Ad spend as % of B.O.: 71%
7. Over the Hedge (Par-D’Works)
Total spend: * 42.7
Domestic B.O.: * 155
Ad spend as % of B.O.: 28%
8. The Da Vinci Code (WB)
Total spend: * 41.7
Domestic B.O.: * 218
Ad spend as % of B.O.: 19%
9. Mission: Impossible III (Par)
Total spend: * 41.5
Domestic B.O.: * 134
Ad spend as % of B.O.: 31%
10. Blood Diamond (WB)
Total spend: * 41.3
Domestic B.O.: * 57
Ad spend as % of B.O.: 72%
* in millions of $
In an intersting tidbid that I was having with a VP in Warner Bros, a surprising fact was revealed. Very few, if any movies, break even at the their THEATRICAL run in the box office. And studio executives know that and are ready for it. Theatrical is the “shelf space” that “buys” them the real profits on DVD/Cable/Other including airline sales, where the profits are really made.
B) India suddenly happens to have become the PLACE for independents. In a development that is far ahead of most cinema loving countries, multiplexes in India are now open to showing ANY INDEPENDENT feature length film, on a revenue sharing model. This is a big boon for independents since the revenue sharing does away with the upfront cost associated with Theatrical. Also this gives the opportunity for independents to truly showcase their products and who knows, walk away a commercial winner. Now if only the box office reporting in India would improve? Currently it is an arbitary “Hit” “Flop” “OK” with no regard to the cost of making it, revenue as a percentage of investment, etc.
C) South Asian audiences in the US continue to be divided in their preferences. Earning power has no correlation to spending power when it comes to movies. Hence a Toronto, or a NY, may not have the per capita income of the Silicon valley (San Francisco and San Jose), but it certainly has more of a “movie going culture.” Theaters in LA are far apart for Desi films, but audience turnout does not seem to be impacted by it. Toronto and Chicago has more sever weather than Silicon Valley, but a better audience turn out, most times, for Bollywood films. Vancouver is also upthere with Toronto and Chicago.
Region wise rankings of where most money is spent on Bollywood films
(1) New York area (including NJ)
(2) Los Angeles area (including Orange County)
(3) Toronto
(4) Chicago (although for Tara Rum , Chicago was numero uno on opening numbers)
(5) Vancouver
(6) D.C. and surrounding areas
(7) Dallas
(8) Bay Area
Whereas per capita Desi Income appears to be
(1) Bay Area
(2) New York
(3) Los Angeles
(4) Chicago
(5) DC
(6) Dallas
(7) Vancouver
(8) Toronto
Goes to show, that money does not always correlate to outstanding ticket sales
Sincerely,
Vivek “Google,EBay,Yahoo,Apple may be here, multimillionaires may be here, but film culture is definitely not in the Bay Area” Kumar
Anurag Kashyap
Abhay Deol
Dibakar Banerjee
Hansal Mehta
Khalid Mohamed
Kundan Shah
Anish Kuruvilla
Jaideep Verma
Manish Gupta
Navdeep Singh
Bhavani Iyer
D. Santosh
Onir
Ashvin Kumar
Ramu Ramanathan
Sudhir Mishra
Pankaj Advani
Revathy
Saurabh Shukla
Shilpa Shukla
Sujoy Ghosh
Suparn Verma
Santosh Sivan
Shashank Ghosh
Shivajee
Pavan Kaul
Partho Sen-Gupta
Prroshant Naryannan
Sam Langoria
Satish Kasetty
Hey Vivek, very interstng post ya!!
Could not understand that region wise ranking, do u imply to say that people of Bay area earn but do not spend on outlandish Bollywood films .is it
Interesting stuff, which can possibly lead to multiple threads of discussion…
Very interesting stuff Vivek. I’ve always wondered if the type of films doing good business differs from region to region. I mean, will a Tara Rum Pum do better in lets say Chicago whereas a Guru will perform better in Toronto? I mean, given a certain track record can that be analyzed? I can imagine its worth it for distributors to look into that sort of thing… mind you, they probably just take the advice of the local exhibitors who know their market well…