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How Movies Make Money: Exploring the Complexities of Box Office Success
In this episode of the podcast, host Brian Koppelman delves into the fascinating world of movie economics with special guest John Mass, the president of Content Partners. Together, they unravel the mysteries behind how movies make money and why a seemingly unsuccessful film can still turn a profit.
Mass sheds light on the various revenue streams that movies generate, starting with the traditional theatrical exhibition. He explains how box office numbers are just the tip of the iceberg and that a movie's financial success extends far beyond its initial run in theaters.
One of the key factors they explore is electronic sell-through (EST), where viewers purchase digital copies of the movie for personal use. They also dive into the realm of premium video on demand (PVOD), subscription streaming services (SVOD), and television licensing, all of which contribute significantly to a film's revenue.
Profit participation deals, a common practice in the industry, are also discussed. Mass and Koppelman examine how actors, directors, and other talent negotiate their share of the profits, often based on a film's performance at the box office and other revenue streams.
The conversation then shifts to the changing landscape of the film industry, with the rise of streaming platforms and the impact they have on movie profitability. They explore the emergence of buyout models and the challenges faced by traditional distribution methods.
To illustrate their points, Mass and Koppelman analyze the recent blockbuster film Mission Impossible: Dead Reckoning Part 1. They dissect its revenue sources and discuss how it managed to surpass expectations, despite initial concerns about its box office performance.
As the episode concludes, the duo makes predictions about the upcoming films Blue Beetle and Strays, speculating on their potential box office success based on the current market trends and revenue models.
If you've ever wondered how movies truly make money and why some seemingly unsuccessful films end up being profitable, this episode is a must-listen. Join Brian Koppelman and John Mass as they unravel the complexities of box office success and shed light on the ever-evolving film industry.