Interesting juxtaposition of movie related articles in The New York Times this weekend.
Saturday, there was a business article about looming flops this summer. There are 19 mega-budget or tent pole releases coming from the studio from May through August (there’s only 18 weekends in that time span- I counted).
Then today came an article about a disgruntled Sony shareholder who is proposing widespread organizational changes because the profit margins were ‘only 6.5%’. Never mind that Sony is one of the most stable and successful studios in Hollywood. The sin is that the profit margin was not as high as other studios despite Sony’s lead at the box office.
These articles reminded me that on Thursday, A.O. Scott wrote a think piece about how many of the recent movies released were about our lust for money and material acquisitions. (“Gatsby and Other Luxury Consumers” by A.O. Scott May 16, 2013). Reading these articles got me thinking about the subject of greed and the appeal it might have to those people deciding what we get to see on screen.
In other words, how subliminally connected is this theme of greed in the current crop of films to the companies that finance them? And by this I don’t include the filmmakers who, no matter how successful, can only make those films that excite their investors.
What else but greed could be fueling the current “shrink to profit” studio approach of reducing the overall number of movies made, but continuing only with the super expensive ones? These companies are sticking to the idea that the only thing they can do consistently well is to spend $150+ million on making a film and another $200 million on marketing that film. All of which pretty much requires the film to earn $700 million in order to recoup. In reality, only a handful of films ever hit that high a number so the risk seems quite substantial. I know we are talking about the “world market” and all of the ancillaries like streaming and what’s left of DVD, but still- that’s an awful lot of money for a two hour movie to make.
There’s really no other case I can think of where all of the leading manufacturers in an industry decide to make only the highest cost products and dump all of their more reasonably priced ones. (If anyone can think of one it’d be interesting to compare). And in Sunday’s business article, the one movie studio that continues to make a larger more diverse slate of films is being challenged by a minority stockholder!
Imagine if every major automaker of the world dumped their entire product line except for their most expensive luxury cars. Imagine any producer of any product saying they only know how to make money by taking the biggest risks possible. How can this be sound business? Yet, the mavens of Wall Street would seem to agree with the new Hollywood game plan. And we know why. The strategy of taking extremely high risks in an effort to score the biggest returns conceivable was what put the world economy into a tailspin in 2008. I believe the technical term for this type of behavior is “greed.” And I’ve got to admit, many of the folks on Wall Street have gotten richer from this.
Tragically, much of the world population has suffered as a result.
Like the world economy’s middle class struggle to survive, mid-level film budgets are becoming rare. The gluttony of big profits diminishes the number of films being made also diminishing the ranks of creative talent and give us fewer choices in the quality and variety of the films we see. Is this what we, as audiences, really want of our films today? The overly simplistic answer is that the box office speaks for itself – hundreds of millions of dollars will be earned this summer from these 19 blockbuster releases. But are the audiences deciding this is the kind of movie they want? Or are they merely selecting from a narrowing menu of choices stuffed down their throats by billions of advertising dollars?
If everyone is trying to seize the advantage by creating the same product and distributing it in the same way, will the industry as a whole suffer? The Stewart article predicts that with everyone employing the same strategy, the odds are strong that we will see at least a couple of spectacular box office failures this summer. Simply put, the article indicates that when everyone uses the same strategy someone is going to lose. Common sense would indicate that this blockbuster strategy is probably not going to succeed in the long run as the cost of the “misses” outruns the profits of the successes.
And what of the outcome for the materially obsessed characters in this summer’s films? Well, generally things don’t turn out well for them as noted in A.O. Scott’s article. We know that, on screen, Gatsby is ultimately undone by his greed.
The question remains as to whether the financiers of these films will be too. Or is it possible for them to “live with” reasonable profit margins and allow that there is value in telling a range of diverse stories?