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David Poland

By David Poland

A Little Clarity On A Billion Dollar Year

The actual fact: Paramount Marketing is the first studio marketing group to generate a domestic gross of over $1 billion this year.
I hate these stats. The idea of market share in the movie business – especially domestic only – or hitting $1 billion is a throwback to the pre-VHS movie universe. Silliness.
That said, of all the majors, Paramount has had the leanest year, in terms of movies that the studio produced or financed. Specifically, none of the three big hits are anything but service deals with the studio for distribution and marketing. Remove the two DreamWorks Animated films (8%) and Marvel’s Iron Man 2 (10%) and the studio has generated under $256m with movies that Paramount has produced, the biggest of which is Shutter Island, which was produced in-house.
In fact, I believe that Paramount, with the three big hits, is the only major other than Universal with MacGruber, that has done any service deals for a domestic studio release this year. So Sony (not counting Screen Gems) is the second lowest domestic grosser of the majors so far this year, with about $300 million on in-house movies. Universal is third from the bottom with about $350m. Disney is near $800m. WB is around $850m. And on top is Fox, with just short of a billion… all from movies in which the studio invested.
Now… Paramount will earn about $122 million from their three big hits, on theatrical distribution and marketing fees alone. They will make more on Home Ent. So it’s not nothing.
But when Fox hits $1 billion – today, perhaps – it will not only earn distribution fees, but a lot of profit on the 4 highly profitable hits… not to mention the losses on their three films on which they may need to eat a loss. (Three other films are somewhere right near breakeven or minor loss or slight profitability.)
Disney and Warners are also likely to pass The Full Billion by the end of July as well.
I don’t know. Maybe I am not being fair to Paramount. But I just think that these kind of stats need context and their context is not like any other studio… until Disney starts emulating it in earnest in 2011.

11 Responses to “A Little Clarity On A Billion Dollar Year”

  1. IOv2 says:

    Let me channel Lex for a moment and state… AANG POWER! YEEEEEEEEEEEEEEEEAWWWWWWWWWWWWWW!!!!

  2. marychan says:

    Warner Bros has also released “Splice” as a service deal with Dark Castle.

  3. David Poland says:

    Do we really consider Dark Castle a service deal?

  4. IOv2 says:

    That’s what she said.

  5. hcat says:

    Isn’t the 10% they make on the Marvel deal a hell of a lot better than the losses they were incurring making Shooter and Sahara? I understand you wanting to put this in perspective and you should, outlets that are just going to run that press release sight unseen are doing lazy reporting, but isn’t Paramount having more success lately by doing less?
    And I don’t know how important this really is but a significant portion of that billion goes to the theater owners, doesn’t a box office hit, no matter who put down the original coin, help ingratiate Paramount with the people who are deciding who gets the screens?

  6. EthanG says:

    Good post…though why you wouldn’t include Screen Gems but count New Line for WB is confusing to me.

  7. David Poland says:

    Because WB ate NL whole and Screen Gems is on its own leash at Sony. Screen Gems is, for me, much like Sony Classics or Searchlight or Focus.

  8. David Poland says:

    hcat… both DWA and Marvel have been great for Paramount. I’m not saying otherwise. And sure, better than failing.
    But we’re talking about perspective and throwing around Billion like it matters.
    You know, in analyzing Fox, I take points off for them selling off a significant percentage of Avatar. WB’s leadership has survived in no small part because in bad years, they have sold off half of the losses and benefited from distribution coming off the top.
    This particular piece was about BILLION.
    I am not a big fan of the idea of studios being service businesses primarily. But Disney is heading there too, so…

  9. LexG says:

    Kind of a side issue, but per hcat’s post…
    I sort of miss THAT Paramount. The early-00s era where they released like EIGHT movies a year, and three of them were super-generic, steely Mace Neufeld-type military potboilers OR Ashley Judd thrillers, two were Ashley Judd/Monica Potter domestic peril movies, two were bad SNL-level cheapo comedies, and their ONE big blockbuster would be some 1992-style, NO-FILTERS, NO-SHEEN nuts and bolts action movie like Tomb Raider, The Saint, Italian Job, Sahara, etc.
    Now it seems like they just make seven of those cheap-ass comedies and do one big blockbuster, and half the time that big one is really just a DreamWorks movie.
    They still have to be the least prolific studio. I’m sure DP would have a pie chart to prove me wrong, but it does seem like Uni, Sony and WB release a new movie EVERY SINGLE WEEK, or at least every other week, whereas whole months go by with nary a Sony release.
    Come to think of it, that stretch between DATE NIGHT and MARMADUKE/A-TEAM seems like the longest Fox has ever gone without a release, but I’m sure 17 Searchlight movies dropped during that frame.

  10. LexG says:

    “…nary a Par release,” sorry.
    Seriously, I swear every single trailer I ever see, ever, is Uni or Focus. Just the other day, THE AMERICAN and THE ADJUSTMENT BUREAU trailers back to back, movies that probably come out back to back, movies that ARE THE EXACT SAME MOVIE… both Universal.
    You never see Paramount doing that. Or doing something like dropping GROWN UPS two weeks after KARATE KID (Sony), or GET HIM TO THE GREEK two weeks after MacGRUBER, flooding the market and rushing out their own shit right on top of their last thing.
    That’s why as a DVD-biz lackey, I always wanted to work for a company that handles Paramount’s shit… It would mean 30 less movies a year I’d have to have immediately destroyed or cheapened by having to work on them two days after they’re released to theaters.

  11. hcat says:

    David – I see why you want to pull aside the curtain on the release, and that kind of analysis is exactly why I visit the site. But you can hardly fault Paramount with putting out a good news press release. Its their job to spin any numbers there way, the press’s job to shoot holes in it. I can’t imagine the publicity department thinking “We just hit a billion in receipts, but we really didn’t earn it lets just keep it quiet.”
    Lex – Paramount lived in the eighties long into the middle of the last decade. Every time they looked like they might get past the star driven action drama or comedy they would have some out of nowhere cheapie hit like Double Jeopardy that would just reinforce their behavior. It just seems to be the last few years that they decided to spend the money to compete with the others, though I do miss the simple assembly line pleasures of Summer School, Heartburn and Black Rain.

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