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%'s 26 Oct 2005 18:36 #11151

  • SamCat
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What are the normal % costs from film distributors worldwide?
Like USA, Europe, Australia, etc
Also are they charging you more % for King Kong, than a normal big block buster movie like Lord of the Rings etc?

Have you found that %'s are gradually increasing over the term of the movie? eg Week 2 and 3 %'s are staying higher? What was it say 20,10,5 years ago?
Why is changing?
Are the minimum weeks also getting longer compared to years ago?
If there are reports that the movie attendance is declining and distributors are making more money on DVD, Cable etc then why are making it harder for exhibitors?
Especially with increased property costs, wages, rents, etc.
Do you think digital will change %'s and minimum weeks to run prints?

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Re: %'s 27 Oct 2005 02:28 #11152

  • outaframe
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Well, you do ask a TON of questions, and I can't answer all, but for whatever it's worth, here goes...

When I bought this business (leasehold, inventory & "blue sky") in 1970, here was the situation... This theater had been part of a midsized statewide chain since the early 1930s, and the chain had been broken up in 1957, at which time the individual theaters (leaseholds mostly) were sold, usually to those who had been managers of that particular theater at the time of the breakup... In this particular location, the business had been sold to my boss, who had started more than 20 years before that as one of the staff at this location, but ended up as head film booker for the chain... He came back here and operated this theater as a family run independent (in 1957), and the guy who had been his assistant, at the time of the breakup, made an arrangement to book for most of the theaters which had been part of the chain (now in the hands of its former employees)... My boss also "went along" with his former assistant, and payed him to book this theater, as did most of the others... (are you still with me?)...

While he had booked the chain, my boss had established a SLIDING SCALE film rental agreement (with nearly all of the distributors) for each of the individual theaters in the chain that was based on a 10 unit week, with weekdays being 1 unit, Saturday 2 units, and Sunday 3 units... So, if you played a picture, say, Wed-thru-Sat, that would be a 5 unit playdate, and a 7 day run would be a 10 unit playdate... First run pictures were settled for with the distributor, using that scale... Up to so many $$ GROSS per unit, the film rental was 25%, between X amount and X amount GROSS per unit, the film rental was 27 1/2%, and so forth, up to a certain amount of GROSS per unit which was 60% (the total gross for the run divided by the number of units in the playdate, equals the gross per unit)) so 60% would be the maximum film rental, and 25% would be the minimum... You payed a variable % based on how well the film performed in your theater... AN ARRANGEMENT FAIR TO ALL...

My boss used his former assistant to book this theater in order to keep this sliding scale arragement in place, as did most of the others who now owned the thearters they had managed for the chain... (Are you still following this?)...

When I bought out my boss, I too retained his former booker for nearly two years, for the same reason... You have to understand what "first run" meant at THAT TIME... There were FAR fewer prints made for each new release then, maybe only 20 prints in each film exchange for certain pictures, so your "first run" in your location could be 2 to 6 months after that picture had opened in the major markets in the area... Some of the Roadshow pictures could be as long as a year later, if the picture was a huge success and was held over for months somewhere... On lesser pictures, you MIGHT get it on the break, or a week or two later, depending on how well it did in the major markets... BUT that wasn't a disadvantage because IF THE PICTURE HAD LEGS, you could buy it at a fraction of the % someone paying firm terms had paid, and even it was a door buster, you weren't going to pay more than 60%... THOSE were the days when creative booking paid BIG dividends...

Well, within a couple of years things changed... My booker and I didn't agree on a number of things, several of the distributors were balking on "scale" rental terms, and the market was changing... I started booking the pictures myself, and playing a mix of first run, later run, re-releases, and flats fitted to my audience, local events in competition, the school calendar (including the local college), the expected weather, a lot of seat-of-the-pants intuition, etc. and increased BOTH the grosses and the net bottom line by a considerable margin... IT WAS BOTH FUN & PROFITABLE...

This is turning into a Russian novel, so I'll try to summarize and condense it a bit... Today I'm paying about 12% MORE of the gross as film rental than when I first bought the theater... I play few (hot) pictures on the break any more, because I won't contract for more than a 2 week run (but have held some over which warranted it) and won't pay high firm terms for something I doubt will do boffo business, or wouldn't have earned that %, based on the old sliding scale chart above... There are no Roadshows, and really no genuine re-releases, and flats are almost a dead item because of cable TV... We are left with playing whatever is in release before it goes to all the ancillary markets, so the only choice you really have is play it first run, or play it sub-run before Wal-Mart has it on the shelf... You have very little "wiggle room" to play a mixture tailored to your particular audience... Why is it this way: because the studios are nothing more that releasing companies and don't make the pictures, just help with the production costs in order to secure the distribution rights, and because their only interest is the bottom line: where ever they can get the most, the fastest and easiest... Will Digital make it better: No, it'll probably be worse... Happy Trails!...

[This message has been edited by outaframe (edited October 27, 2005).]
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