Quote:
Originally Posted by DaneMcCloud
What's not factored in the raw box office receipts is marketing and exhibitor fees. Movie theaters can take up to 30% of the overall take. Marketing can easily surpass $100 million.
Disney spent $175 million marketing "The Lone Ranger", so they've spent more than $400 million on a film that will never earn enough to break even.
The dirty little secret is that the studios *need* huge box office failures in order to pay less in taxes and avoid contract escalators.
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I figured there were some unlisted expenses. I wouldn't say "need", I might say there are some offsetting benefits to losers that allow them to take risks.