> 6. Tricky Hollywood Accounting To film _Matrix Reloaded_, they built a fake freeway on the Alameda naval base in San Francisco. I drove on it (as an extra in the movie); it was really really cool. The company originally thought of keeping this set around for a while to use in driving scenes for other film projects, but they ended up destroying it instead. Why? Because the film was likely to be profitable! A film se…
Why the film industry needs disrupting
41–50 of 58 posts
Re: Why the film industry needs disrupting
#42Unfortunately I want to the other article, the one that I cannot get anyone in the 'movie biz' to fess up to. That is what would it be like if it were perfect? Would there be a mandatory licensing fee for scripts? Would there be non-discriminatory rights for theatres? What?
Someone needs to sit down and design a way to disrupt Hollywood. That requires three things, production disruption (how movies get made), distribution disruption (how they get distributed), and consumption disruption (how they get consumed).
The good news is you might have an ally here in the form of NetFlix or Amazon. They can handle distribution and consumption, which is to say they can 'sell' views via their networks. You might also get some traction with 'Fathom Events' which rents out digital theatre projectors for pay per view events.
You don't yet have a way of disrupting production.
To do that you probably need to re-create the old 'studio' model where you have a staff of production people and actors. A couple of sound stages with solid green-screen technology, and your own 'pocket' CGI capability for putting together scenes. That is your 'back lot' equivalent.
More importantly you need a disruptive business model. That is because as it stands bankers and other sources of capital understand exactly who gets rich and who gets screwed in the movie industry, in your new model they won't know and they thus they won't be able to understand how much (or how little) risk there is to their capital. And you will need a lot of capital to make movies or 'serials' (Think of them as sporadic TV shows where the episodes don't necessarily come out every Tuesday at 8PM)
This is going to take some strategic planning and understanding exactly what things really cost. I worked on this sort of project to understand how the periodical publishing market was to be disrupted (and to identify business opportunities in the disrupted market) and its painful. There was no source of 'how much do editors make?', 'journalists?', 'folks who run printing presses'? 'folks to drive vans to drop off papers/magazines?' You really need to open up a business from the inside, and dissect it to understand how it works, where the money goes, and what the leverage is of each of the individual pieces. But understand that doing this sort of dissection gives you to knowledge of how to disrupt and that means the person sharing it with you, if they aren't already committed to joining the revolution, is writing their own death sentence. Ouch!
The best you can hope for is to approach the problem like the CIA trying to infiltrate an enemy government. Develop assets, interview people who are fired or leave, do forensic accounting on suppliers and contractors and unions. Not easy, you are a threat, the people who have the power know you are a threat and they will do things to slow you down or stop you.
So take the current players and develop a parallel track. It will be hard, and it will be expensive, and it will be beset with issues the entrenched folks throw at you. But you do need a solid strategic plan and good backing.
Re: Why the film industry needs disrupting
#43Re: Why the film industry needs disrupting
#44Earlier quoted context omitted.
Ok, so I get that a film studio would be willing to charge expenses like Lucas' promotion of Return of the Jedi 3D to their accounts, because its an investment for future gross profits (but the 'investment' doesn't cost anything, because if they didn't make that 'investment' the money would go to paying net-profit-share actors instead). But how is it advantageous to them to completely waste money on destroying the fr…
Suppose you use the same freeway set for exactly two films: (1) the big expensive sequel _Matrix Reloaded_ (2) some cheap indie zombie film (being on an entirely empty freeway in the middle of the day is kind of creepy all by itself) ...and then the set has to be destroyed - a storm knocks it down or the land owners decide they want the space back for some other use. One rational accounting method would be to split t…
Re: Why the film industry needs disrupting
#45How can a cartel be disrupted? While this article makes me angry (especially as a consumer, where the limiting of choice has a definite impact) I don't see a way for anyone to 'disrupt' this behavior. Tech- and entrepreneurial-minded folk like to look for disruption opportunities and while they may exist in theory, these are industries supported by mind-boggling displays of corruption. In this case, you couldn't touc…
There are lots of arthouse and Indy films, for example.
Re: Why the film industry needs disrupting
#46> 6. Tricky Hollywood Accounting To film _Matrix Reloaded_, they built a fake freeway on the Alameda naval base in San Francisco. I drove on it (as an extra in the movie); it was really really cool. The company originally thought of keeping this set around for a while to use in driving scenes for other film projects, but they ended up destroying it instead. Why? Because the film was likely to be profitable! A film se…
Ok, so I get that a film studio would be willing to charge expenses like Lucas' promotion of Return of the Jedi 3D to their accounts, because its an investment for future gross profits (but the 'investment' doesn't cost anything, because if they didn't make that 'investment' the money would go to paying net-profit-share actors instead). But how is it advantageous to them to completely waste money on destroying the fr…
Money isn't wasted, someone earns it. The studio's want their subsidiary "Movie Construction, Ltd" earn that money rather than anyone else.
Re: Why the film industry needs disrupting
#47While I do believe the film industry needs "disrupting", I do not believe this was the point of the article, nor does it make any good arguments to back up a thesis of "disruption". "6. Tricky Hollywood Accounting" - this is purely a contract negotiation issue, and it is is no way a hollywood-specific problem - in all lines of businesses you will find companies which try to setup "royalty fee" or similar buyer-contro…
USA is the country with the most choice also, and yet consumer is strangled. Well just guess how it is for the rest of us, Netflix doesn't even remotely exists anywhere else. anywhere
Based on this I have the tendency to trust the article author on the other points (which I don't know about)
Re: Why the film industry needs disrupting
#48Well, the most important item is not on this list: Hollywood doeant have a frigging clue about what makes a film successfull (except some obvious metrics, like big names, that anyone can think about), they're completely divorced from the audxience reality. There are many movies that become blockbusters to the great suprise of producers and vice versa, despite the many preview audience screenings, market research, etc…
Re: Why the film industry needs disrupting
#49How can a cartel be disrupted? While this article makes me angry (especially as a consumer, where the limiting of choice has a definite impact) I don't see a way for anyone to 'disrupt' this behavior. Tech- and entrepreneurial-minded folk like to look for disruption opportunities and while they may exist in theory, these are industries supported by mind-boggling displays of corruption. In this case, you couldn't touc…
Find a substitute product. Or just stop buying this one and wait. There are lots of arthouse and Indy films, for example.
Almost everything that comes out of Hollywood is slavishly derivative anyway.
Re: Why the film industry needs disrupting
#50When he signed the contract for The Godfather to be made into a movie the royalties he'd receive were to come from the net income of the movie, not the gross. Due to the accounting practices described in the article the film hardly made any money on paper (it grossed a lot but had exaggerated expenses). Already wealthy, Puzzo bet his royalties (a fraction of what he expected) on a roulette spin and walked away. The moral is to always get a percentage of the gross, not the net.