Authors note:
This is my first article. So be gentle. Also, before you start ranting, I did NOT like this movie at all. I would have made my own review of the film if there hadn't been 2000 others already in this section.
But just because I hated the movie does not mean that I can't talk about it objectively. The reason I decided to write this article is because of a debate I had with another user on the site, where funnily enough, I attempted to justify the "$900M break even" statment. However I figured I owed it to myself to at least be educate on the facts, so I ended up doing a lot of research on the subject. Through this I disovered quite a lot about Box Office, and that it wasn't as simple as I originally thought. I'd also like to add that I am by no means an expert, not even close, and don't take everything I say at face value. I'm only reporting on what I've learnt. I will be sure to include links throughout the articles but I also encourage you to do your own research as well.
Anyway, with that out of the way, lets Begin....
RIght so you've no doubt heard by now, the claim that Batman V Superman needs to earn at least $800M - $900M in order for the studio to break even. This supposedly came from a report from Deadline.
Now many articles from different publishers have quoted Deadline in saying that it needs $900M to break even, however I can only find one instance of the website itself actually saying this.
It might be difficult to find, but that quote is defintley in there. However it doesn't explain how they came to that figure. Most people assume that it has to do with the over-inflated budget - and don't get me wrong - it's pretty large even for a blockbuster move. The reasoning is that, with a production budget of $250M and P&A (printing and advertising) coming to $150M that it has a budget of $400M give or take. They also say that Theatres take around 50% of the box office from the movie, and as such it would need to earn double it's production budget before the studio would start making a profit. In this case that would be at least $800M.
Are people right in saying this? Well the answer is both yes and no.
To put it simply...people are putting it too simply. There are so many factors that people have to take into consideration; costs that haven't been included in that budget, revune from other sources that have been left out completley, and figures that have been too roughly estimated. Unfortunatley I wish I could tell you that I'm here to "set everyone straight" and provide you with a comprehensive list of EVERY fact and figure that would clearly outline what the film definitlvey made and lost. But I can't. Because no one knows that. Film companies rarely give out the ALL the statistics of costs and revune, and most of the figures you see on websites like Deadline are from reports that they can find or insider information that they've managed to obtain.
There is so much "Hollywood math" invlovled in all of this that we'll likley never know the actual profit that these films make. Even "cost sheets" from Deadlne seem to vary, either leaving out important information like "P&A" from one report and "overhead costs" for others.
It might seem like trying to make sense of any of this is a fruitless endevour. However...all my research on subject did tell me something about the modern film industry. To put on my tin-foil hat for a second, something they probably don't want people to know.
Everyone seem's to be focussing soley on the box office and assuming that it's vital for a movie's sucess. But it isn't as significant as you might think. Did you know the report from Deadline reveals that, purely based on box office, the movie Interstellar actually made an estimated $173M LOSS at the box office?
Yep. In the report, if you add up all the costs including; production, domestic/foreign/Chinese revenue sharing, participations (payouts to producers basically), overhead and interest it racked up a cost of exactly $439M. Now if you factor in the revenue from domestic, international and china rentals it brought in $266M (rentals is money made to studio from box office, not box office itself). Now if you minus the cost from revenue you'll see that the studio lost $173 million based on that.
Sounds awful right? All this despite banking over $700 million at the B.O. Yet it wasn't the end for Nolan's space-flick. Global Home entertainment sales is what made up for that loss in the end. Because of the revenue earned from DVD and TV, it managed to make $47M in profit overall. Now that might seem pretty miniscule in comparrison to the massive WW box office, but its not the only film with such an unbalanced ratio.
X-Men Days of Future Past also made a LOSS of $178 million dollars if you compare only the theatrical box office against all of its costs.
Just so you can understand where I'm getting these figures, I've highlighted the relevent statstics that I compared. EDIT: I accidently circled "Residuals and Off-The-Tops" but that isn't a part of the estimate for B.O. As residuals are payed AFTER movie has hit home theatres. As was the case with Intersteller, Fox Studio's still managed to bank $77 million dollars in profit overall. And again, it was mostly to do with money made from Global Entertaiment revune - which was $255M - making up for the loss and then some. Even the massivley sucessful Ironman 3 only made $67M on its theatrical box office run, untill the GE revenue brought it up to a much more imprssive $394M for the Disney coorperation.
There is a trending pattern here.
As the demand for movies increase's, movie studios see a growing the need for "bigger" and more profitable films to compete in this industry. We live in a world where a big blockbuster movie like Batman V Superman now have to reach 1 Billion dollars to be considered a "true sucess". As a result, producers are massively over inflating their budgets for these movies, which is why at the box office these movies seem to be failing. Especially when those theatres take such a large chunk of your ticket sales.
It's only understandable, then, that they're no longer relying on B.O to compensate the money put into their movies. Let's look back at Days of Future past for second. If we compare it's revenue against box office, the studio only earnt around a measly 44% of the its world wide gross ($332M revenue divided by $748M B.O). However, they got to keep a whooping 77% of their GE revenue ($314M revenue divided by $407M total). This doesn't even factor in money made from product placements or merchandise which will earn the studio even more.
So when people say that BvS needs $900M during its theatrical run to break even...they're probably right. But the truth is, it doesn't really matter. Sure WB undoubtedly were hoping that the movie was going to be a smash sucess, and raking in the kind of dough The Avengers once did 4 years ago. But as it stands WB will make certainly make a profit on this movie. The very same article that stated Batman V Superman needed to make $900M to break even, also says on the same page that it will likely create a $200M profit for the company overall.
I write this article in the hopes to shed some light on the whole debate about box office. Since everyone has been so caught up it in recently. I can already sense there'll be a few people in the comments that won't have read my article and will post things like;
"Needs $900M to break even. Get over it"
"Troll. Stop trying to defend this movie"
There'll definitely be a someone that post those exact phrases, trying to be funny or "ironic". But honestly...I don't care. I'm not interested in trying to satisfy anyone's conformation bias. I myself have set aside my dislike for this movie in order to discover the truth. Feel free to give your own opinions on what I've written and if you provide any more relevent infromation that helps flesh out the discussion that'd be great. I'm not looking to be right. I just want to be certain.
Anyway thanks for taking the time to read and I look forward to hearing your non-trollish opinion's in the comment section!