- Joined
- Apr 16, 2017
@BoomerDenton I'll make Absolutego's potential mistake and treat you as a non-troll.
Also remember that while TFA made 2 billion at the box office, TLJ made 1.3, both on budgets around 250 million. So you'd thing 2+1.3-0.25-0.25 = 2.8 Billion, but remember that is from net box office receipts. Hollywood goes above and beyond to keep actual profit numbers hidden by playing lots of game (which is a whole other rant) but you can assume that for any blockbluster, less than double the budget is a loss.
(Compare this to say Deadpool which pulled $800 million on a $60 million budget)
As @Absolutego points out, the box office totals are nice, but as Lucas presciently figured out for starwars, that's small potatoes compared to merch. And those are in the toilet and declining. (If you have Netflix, there is a docuseries "The Toys that Made Us" and the first episode is about the Star Wars toys.) Part of this is Disney cannibalizing their own market - Marvel and SW audiences have large overlaps of Man children, and they have been saturating the market with both.
But the other part is that the Didney Waz movies just isn't getting or retaining adult fans, especially ones that buy merch; Marvel is selling, pre-buy out Star Wars is selling, but no one gives a fuck about Holdo and Rey.
Also remember that Disney bought Lucasfilm back in in 2012, 7 years ago, for 4 billion; lets just round up to 10 to give TRS a chance to drop, go to DVD, and accounting to complete. I don't want to sperg too deep into business math, but forgetting the cost to build Galaxy's Edge for a moment, if after 10 years Disney only makes back the 4 billion on the films, it will be a huge failure and Iger will be feeling pressure to step down.
You might be thinking "That doesn't make any sense, they made the purchase price back and still own the rights, so any dollar they make after that is a dollar in the black". But you'd be forgetting that investment math is different - if you just break even its been a failure, and was a bad risk. After 10 years, and given what Lucas was pulling from SW before the buyout, investors will be looking for at least double returns and probably more.
Disney isn't exactly in the poorhouse - 'not making as much money as hoped' is a far sight from 'losing money' - and even if all 7 billion people in the world suddenly decide "You know what? TLJ was a mess and I hated what they did to Luke. I'm done." and TRS never makes a single dollar, that's not going to put Disney under.
But what it IS going to do is make the investors pissed and demand a toll in blood and heads from the executives.
tl;dr Disney will survive TRS being a bust. Iger won't.
I doubt Kennedy is any sort of Lucas-sent assassin, despite how horribly she's fucking up.
But if we're going the Machiavellian Lucas route, its more likely that Lucas probably recognized she was worthless, but made sure she'd stay at the helm after the hand over, and just decided to let nature take its course.
Lucas by all accounts wanted Didney Waz to be a success; why wouldn't he? Just sit back let other people do the work and deal with angry nerds, and just collect the fat checks. Disney's attempts to muscle him out of his percentage backfired.
So, here's a graph from earlier showing off sales. I'm pretty sure this is sales revenue, and not total profit for Disney
View attachment 898058
So that's, (rounded generously for Disney) about 26.2 billion dollars in all sales. Assuming they take 60% of all of this (generous assumptions), they come away with 15.72 billion dollars, which they can then turn around and alleviate their debt of 10 billion, leaving them with a profit of about ~5.72 billion dollars.
View attachment 898079
Here is a very quick, very poor investment for Star Wars. This is 2% compound interest yearly over the same time period. This abysmal investment comes away with about ~1 billion dollars profit, but the numbers are starting to rack up. In another 4 or so years, this would outpace Star Wars in terms of investment, and certainly in terms of reputation.
I found this interesting article on the shit hole that is the io9 collective detailing the profits for a film and how little of it a studio may actually get to keep. It was written in 2011 but I'm sure it still applies when adjusted for inflation.
In short, according to the article, a studio is lucky if they even get half of the box office revenue while the rest goes to the distributor, and the more money a film makes, the more the distributor gets. And what foreign distributors get may even be more than US ones since foreign governments don't want all of their country's cash leaving their country, so they may even impose tariffs upon US studios.So generally, how much of the domestic box office revenue goes to the studios?
The percentage of revenues that the exhibitor takes in depends on the individual contract for that film — which in turn depends on how much muscle the distributor has, according to Stone.
These deals often protect the theaters from movies that bomb at the box office by giving the theaters a bigger cut of those films. So if a film only makes $10 million at the box office, the distributor will get only 45 percent of that money. But if a film makes $300 million at the box office, then the distributor gets up to 60 percent of that money.
You can actually look at the securities filings for the big theater chains, to look at how much of their ticket revenues go back to the studios, points out Stone. So for example, the latest quarterly filing by Cinemark Holdings, shows that 54.5 percent of its ticket revenues went to the distributors. So as a ballpark figure, studios generally take in around 50-55 percent of U.S. box office money.
Is it better if a movie makes more of its revenue in the U.S.?
The highest profile example of a film that bombed in the U.S. but made tons of money overseas was The Chronicles of Narnia: Voyage of the Dawn Treader, which made only about $100 million domestically but made about $270 million overseas. And a similar thing happened with the previous Narnia movie, Prince Caspian. Another big film that made way more money overseas than domestically was Terminator Salvation.
So if a film does incredibly well overseas but flops in the U.S., does that make it a hit? As with everything else to do with box office, the answer is "it depends." But generally, domestic revenue seems to be be better for studios than overseas revenue, because the studios take a bigger cut of domestic revenue.
According to the book The Hollywood Economist by Edward Jay Epstein, studios take in about 40 percent of the revenue from overseas release — and after expenses, they're lucky if they take in 15 percent of that number.
Domestic revenue just counts for a lot more than overseas revenue, says David Mumpower with Box Office Prophets:
But still, overseas box office does matter, more and more. And stars who have a huge global following are more likely to open a movie than ones who are only famous in the U.S. — just look at the fact that the world-famous Tom Cruise is still starring in movies, despite his ongoing backlash in North America. Mumpower points out that Cruise's Knight and Day only made about $76 million in the U.S., against a production budget of $117 million. But since Knight and Day made $262 million overseas, chances are it will end up being profitable once home-video revenues are factored in.The reason for this is simple. Collecting revenues abroad is a trickier proposition since the dollar fluctuates against foreign currencies. There are also tariffs from these governments in place in order to keep as much money as possible from leaving their countries and going abroad, which is an understandable practice. While the global conglomerates such as Fox, Disney and Time-Warner that run major Hollywood studios can secure sweetheart deals with various local governments, it doesn't happen for each film. As such, international box office revenue is much less reliable than in North America.
Adds Mumpower:
A shocking number of 2010 releases did better abroad than in North America, which makes sense when we consider population numbers. It's just a relatively new phenomenon for the industry. Avatar's performance is a great demonstration of global expansion. It earned $760.5 million domestically, which is (almost) a drop in the bucket compared to the $2.02 billion it accrued in international box office. Only 27% (i.e. roughly a quarter) of Avatar's box office was earned in North America. That's how important the global picture has become to Hollywood studios.
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