How do films make money

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List of Partners vendors. Your Money. Personal Finance. Your Practice. Popular Courses. Key Takeaways While there's a lot of money to be made in the film industry, the economics of movie-making are far from simple. Theater attendance in the U. Ever since Star Wars, merchandising has played a major role in revenue for films that appeal to children.

Television rights, video-on-demand, and streaming services are increasingly important sources of income for movie studios. Some American films make more money internationally than they do in the United States. Article Sources. Investopedia requires writers to use primary sources to support their work.

These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. Search Submit. How to start a cinema 10 The economics of the operation Cinemas have operated along largely the same business lines for many decades, but these are starting to change as the industry adopts new ways of presenting films.

Home How to start a cinema The economics of the operation. Income Cinemas derive their income from several sources, the most important being: Ticket sales and membership income if applicable Food, drink and merchandising sales Advertising revenue screen and brochure Public funding The majority of their income though, is from screening new release films and selling confectionery, food and ice cream to the audiences who attend.

Ticket pricing Ticket pricing should take account of a number of factors. Marketing and publicity Premises costs: rates, insurance, maintenance, heat and light, cleaning, security Office costs and licences Performing Rights Society, etc. The market is unlikely to bear much more than your local multiplex and you may need to charge less if your technical facilities are inferior. These vary considerably according to what you can offer distributors. Staffing levels will be dictated by legislation and the layout of your building.

Next Chapter 11 Operational matters. Previous Chapter 09 Capitalisation. Guide What licences do I need? First Name. Last Name. What region are you based in? What would you like to receive emails about? Come day of release, the titles were there, but Amazon had shut down any pre-sales. The various Sky Movies channels make for an interesting study here. They have their high-profile, premiere splashes, with new and big-name films advertised and given good slots on the schedule.

Then they fill up their schedule with… other films. Of all kinds. Even crummy old films are pushed on TV stations, and charged for. Another small screen outlet will be up in the air. Movies are also licensed for those smudgy little panes on the back of airplane seats. You should. Uwe Boll certainly has. Australia has recently agreed to welcome the next Pirates Of The Caribbean movie to its shores. And the Australian government know it, so they made sure it was going to happen by offering a tax incentive.

From their press release:. That package had been offered to Disney by the previous Labor government to film the 20, Leagues Under the Sea remake in Oz but that project was shelved after director David Fincher departed.

Have you seen the sheer volume of Pigs merchandise they produced? And then Star Wars. And then the wall of figures, dozens upon dozens in the range, taking over the toy shop and the department store. Yeah, you. The fat one. Buy me. Buuuuuuuuuy meeeeeee. Theater attendance has been challenging over recent years, making it even harder for studios and distributors to profit from films. The percentage of revenues an exhibitor gets depends on the contract for each film. You can see the securities filings for large theater chains to see how much of their ticket revenue goes back to the studios.

Studios and distributors generally make more from domestic revenue than from overseas sales because they get a larger percentage. Still, overseas ticket sales are incredibly important, especially today.

Independent filmmakers can actually make money if they have a great foreign sales agent who can sell their film in key overseas markets. Once upon a time, it was all about DVD sales. Films have to leave the theater at some point, but they can remain evergreen on TV. As the saying goes, nobody knows anything in Hollywood. In Hollywood, there are no guarantees.