About Business and Distribution Nowadays

Hollywood is certainly one of the most extravagant, artificial, exciting and unpredictable industries in the world. Every day, hundreds of meetings between producers, directors, writers and studio executives take place all over the country in order to bring a project to life. Making a film is certainly a similar process like opening a new business in town. You need to hire the right people to help you bring your vision to life, you need to advertise it, promote it, sell it and most importantly; convince everybody to come over and purchase something from the business. In the film industry ticket sales used to be the only way where films could make a profit or hopefully at least break even when the movie wasn’t as successful as planned. It was until Star Wars changed the game in the industry by also taking advantage of its merchandising and licensing deals that made producers realize the great horizons that big blockbusters could be capable of reaching. Nowadays the distribution and sales game in movies has expanded and has become broader to the point where studios can release films simultaneously at the theaters, stores (DVD’s) and on the internet through our various well known Video On Demand platforms. In fact, a lot of new companies through out the last few years have become incredibly powerful and self sustainable (Netflix, Hulu,etc) to the point where they are not only distributors or VOD platforms, but they are also able to produce and distribute their own content without having to reach for a third party in order to promote their new projects.

It is clear that having a built in audience is certainly what a lot of producers hope whenever they put their hands on a project that is about to go into production. Star Wars, The Hunger Games and Harry Potter are just a few good examples of the importance of having a built in audience that will consume anything with the name of the brand on it, including a film. As I previously talked about the new strategies that studios use with all the franchises that exist, it is clear that the markets have become very stable for the biggest studios that have been blasting the audiences with continuous sequels and other related films in order to increase the number of franchises and hopefully see good results reflected in their Box Office numbers. As an example, it is clear that the purchase of Lucas Film done by Disney back in 2012 was another solid move from the studio in an effort to combine a business strategy with an entertaining and long-time creative vision from CEO Robert Iger. Studios nowadays are making tremendous efforts to secure what could become the new franchises all the way from novels, scripts and other pitch ideas taking place in the industry.

Bob Iger posing with the Millennium Falcon. (Photo By Fortune)

 In the other hand we also have the independent films and their filmmakers, who strive to make the best deals with other bigger distributors in order to improve and hopefully expand the number of outlets for the total revenue of the film. “Little Miss Sunshine” is an example of this. The film was bought by Fox Searchlight when it was exhibited at the SundanceFilm Festival. With a budget of only $8 million, the film went on to make around $60 million only in domestic theaters. This is certainly another reality of this amazing industry where even the smallest film might always have a chance to attract distributors and become a winner in the blink of an eye.

The "Franchisetic Formula" In Hollywood.

A franchise is an intellectual property that through out the involvement of some characters, settings and different trademarks taken from an original work, is used or adapted into visual, audio and tangible content such as films, tv series, shows, etc. When it comes to planning and creating a franchise there is usually a rule of thumb that dictates that the bigger the franchise, the bigger the names of the stars that will have to be part of the cast of such project. However, there is also another rule that points out the importance of bringing equally talented individuals to take over the planning, logistics and other important creative decisions and input for the project. The director, cinematographer, producer and people of this nature are brought on board of these projects in order to intensify and increase the dimensions of success that the project could potentially reach. 

                                                                                             

           

There is usually a continuos battle in the industry where studios have tried to focus a lot in securing deals and auctioning the rights to adapt several books and novels into screenplays that could potentially become blockbusters and gold mines for the companies. Franchise is a great word in the film industry nowadays, specially when it comes down to talking about gross sales and box office numbers. Just this year Furious 7, one of the most anticipated films of the year broke an unprecedented record at the box office making $1 billion in the first 17 days after the film was released back in April 3. Also, Jurassic World, another film from the worldwide known franchise Jurassic Park owned by Universal studios had the most amazing performance at the box office in Universal's history raising over $1.6 billion worldwide. Taking into account the fact that both films had a production budget of $190 million and $150 respectively, it is safe to say that the return on investment for Universal this year was historic. James Bond, Harry Potter, Pirates Of the Caribbean, Star Wars Transformers, Batman and the Marvel Cinematic Universe are just a few other examples of this elite group of billion dollar franchises in the film industry.

We are currently facing a period of time where studios have been exploring and sometimes overusing this "fantastic" formula, where there is no need to create original content anymore, and all it takes to drive audiences to the theaters is to either reboot the content from previous films or purchase distribution rights from other key franchises once they finish their respective deals with other studios. However this method of generating massive revenue for studios is not beneficial for everybody since a lot of studios slowly push away the chances and opportunities for other filmmakers with original scripts to produce their stories. At the end of the day this is a business and it takes place in a competitive industry suffering the consequences of not taking any risks on other type of projects and therefore, becoming more dependent on a formula that even though it works perfectly fine at the moment, it might not last forever.