Q&A: How to movie companies make money off movie theaters?
Question by Jason Kidd: How to movie companies make money off movie theaters?
Like how much does a movie company sell the right for a theater to play its movie? How do they get the movie in the theaters? What precent of ticket sales goes to the movie company? I have to answer all these questions and find out how X-man first class will make money by putting it in theaters. Just please try to help me as much u can. Thanks so much
Best answer:
Answer by Neil
When movie making was first developed the Studios owned the theatres and independent producers had to go town to town with projectors, but even they were for forced out by conglomerates. The independents sued studios such as Paramount in an anti-trust suit (anti-monopoly) which opened the door to private ownership of theatres.
Now, major corporations (with ties to the studios) own theatre chains. The basic economics is that theatres only take in about 40% of the ticket sales but make most of their money in concessions (90% profit). In return, the THEATRE pays for all technical upgrades (3D, seating, digital projectors) while the studios pick up the tab for P&A (Print & Advertising). A studio will actually pay MORE than the cost of making the movie to promote it.
What is little known is that these major chains will negotiate (0) percentage of ticket sales and even a smaller percentage of concession sales to get extended screening rights for blockbusters like Avatar or X-men first class. Some people say the studios own the theatres again (though this is unproven).
Movies had been shipped to theatres in 35mm/70mm formats for decades. This was expensive and complex because the prints were mostly useless at the end of a run. Foreign distributors also demanded dubbed/subtitled prints with outdated formats (16mm, cinemascope). Today a movie can be distributed via hard drives, optical disks (such as DVDs) or satellite and projected using a digital projector instead of a conventional film projector. Digital projectors were first deployed in 2005.
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