How Hollywood stopped making movies in Hollywood • Hacker News Board

Re: How Hollywood stopped making movies in Hollywood

#31

Post by wahern » Mon, Aug 03, 2026, 4:18 PM UTC

noja wrote: post #15

AlexB138 wrote: post #13

The article repeatedly mentions how production moved to Atlanta due to tax incentives. Even that is a race to the bottom, as Disney moved production of Marvel movies out of Atlanta last year to the UK where they got better tax incentives. Even the undercutting cities are being undercut.

Why though? I thought Hollywood had their own accounting rules which always meant movies made a loss. What are they paying the tax on?

Tax incentives these days include transferable tax credits. Even if your net tax rate was 0%, you can sell the credit to someone else, typically a bank. IOW, states and countries give you money, not simply give you a tax rate break.

Re: How Hollywood stopped making movies in Hollywood

#32

Post by OJFord » Mon, Aug 03, 2026, 4:19 PM UTC

fryanyway_swe wrote: post #28

I mean, kind of good maybe? As someone not in the USA who loves movies, it is too easy to get sick of LA and desert locations everywhere.

A lot of non-LA/desert scenes are LA sets.

Re: How Hollywood stopped making movies in Hollywood

#33

Post by vjvjvjvjghv » Mon, Aug 03, 2026, 4:23 PM UTC

AlexB138 wrote: post #13

The article repeatedly mentions how production moved to Atlanta due to tax incentives. Even that is a race to the bottom, as Disney moved production of Marvel movies out of Atlanta last year to the UK where they got better tax incentives. Even the undercutting cities are being undercut.

The whole tax incentive business is a big race to the bottom. Sports teams also abandon their taxpayer funded stadiums once somebody else offers a better deal.

Re: How Hollywood stopped making movies in Hollywood

#34

Post by coliveira » Mon, Aug 03, 2026, 4:23 PM UTC

dotBen wrote: post #27

An interesting read but also feels like the rearranging of the deckchairs on the Titanic given the forthcoming disruption from generative AI in this industry. I spent some time last month with a relative in the industry (camera operator and producer) and he already uses some very sophisticated AI to map out scenes and shots in gen ai full video before they shoot IRL. It's mostly a cost saving exercise as well as occa…

What will probably happen is that they'll buy the rights to use faces of famous people (actors or not) and use AI (or cheap actors) to do the real scenes.

Re: How Hollywood stopped making movies in Hollywood

#35

Post by schlauerfox » Mon, Aug 03, 2026, 4:24 PM UTC

throwup238 wrote: post #19

noja wrote: post #15

Earlier quoted context omitted.

Why though? I thought Hollywood had their own accounting rules which always meant movies made a loss. What are they paying the tax on?

Hollywood accounting rules are regular accounting rules (GAAP). The only reason “Hollywood accounting” is a thing is because of a bunch of actors who didn’t know the difference between “gross” and “net” points got screwed over. Everyone involved still pays their taxes, but the special purpose vehicle used to organize the production is essentially a passthrough entity.

Movie Money Understanding Hollywood's (creative) Accounting Practices 9781879505865 This is THE book on the subject. There's a lot more to it than that. Sometimes productions get creatively charged by the studios costs that may not be directly related to shift losses. Sometimes contracts redefine common terms so your points structure is completely misleading.

Re: How Hollywood stopped making movies in Hollywood

#36

Post by WalterBright » Mon, Aug 03, 2026, 4:24 PM UTC

throwup238 wrote: post #19

noja wrote: post #15

Earlier quoted context omitted.

Why though? I thought Hollywood had their own accounting rules which always meant movies made a loss. What are they paying the tax on?

Hollywood accounting rules are regular accounting rules (GAAP). The only reason “Hollywood accounting” is a thing is because of a bunch of actors who didn’t know the difference between “gross” and “net” points got screwed over. Everyone involved still pays their taxes, but the special purpose vehicle used to organize the production is essentially a passthrough entity.

I presume that what happens is if a movie is too profitable, other business expenses are shifted to the ledger to reduce the profits. This works because a movie is not a separate accounting entity.

Re: How Hollywood stopped making movies in Hollywood

#37

Post by WalterBright » Mon, Aug 03, 2026, 4:26 PM UTC

harrall wrote: post #23

The cost of housing is probably the #1 reason and, in my opinion, California’s biggest problem. California as a whole is still doing pretty well but high housing cost is slowly pulling out the rug from under the state. But the California legislature does know that and has forced many cities to start building housing but there is still a lot work still in flight.

The flood of immigrants into California inevitably pushes up housing prices.

Re: How Hollywood stopped making movies in Hollywood

#38

Post by bsenftner » Mon, Aug 03, 2026, 4:27 PM UTC

harrall wrote: post #23

The cost of housing is probably the #1 reason and, in my opinion, California’s biggest problem. California as a whole is still doing pretty well but high housing cost is slowly pulling out the rug from under the state. But the California legislature does know that and has forced many cities to start building housing but there is still a lot work still in flight.

I'd say it is the size of the population, far far too many people try to make it in Los Angeles without any specialized educations, so the car washers have 40 people that dry your windows, and the wait staff jobs are exponentially Orwellian. When I finally moved away, I was living over an hour away from Santa Monica, paying $4K a month for rent, and the entire neighborhood lights up every night like a gangsters' paradise. Street racing, graffiti everywhere, sidewalk food vendors everywhere, the local high school kids are covered in tattoos, including their faces. No thank you.

Re: How Hollywood stopped making movies in Hollywood

#39

Post by pixelesque » Mon, Aug 03, 2026, 4:28 PM UTC

AlexB138 wrote: post #13

The article repeatedly mentions how production moved to Atlanta due to tax incentives. Even that is a race to the bottom, as Disney moved production of Marvel movies out of Atlanta last year to the UK where they got better tax incentives. Even the undercutting cities are being undercut.

I mean, the VFX part of the Film industry (and actual location shooting to some degree) has been chasing subsidies / tax credits since around 2002 with the Harry Potter movies that mostly were shot and produced (and more specifically the VFX were done in London, rather than in California) in the UK.

Since then Canada and the UK in particular (and NZ and Australia) have had various different fluctuations in subsidies for various parts of filming / doing post-production of movies over the intervening years.

Re: How Hollywood stopped making movies in Hollywood

#40

Post by coliveira » Mon, Aug 03, 2026, 4:32 PM UTC

ramesh31 wrote: post #8

>"If this has all drifted into bummertown, it’s because many of Hollywood’s problems can be traced back to a single economic theory of everything: the rent is too damn high. From there, everything else starts to unravel." It's really understated just how much this is behind absolutely everything today. The only reason it became normal for SV software companies to pay 100k+ salaries to interns in the 2010s is because…

Also, a lot of real estate is owned by the Hollywood investors or their close friends, so this is a circular economy where they get rich, then buy property in that place and get even richer with real estate increasing in value. The same thing happened in Silicon Valley, Wall Street, and many other places.