The New Math

 Pages PREV 1 2

Jingle Fett:


Jingle Fett:
The $30 million might be just a fraction of the budget...but as of today, Pacific Rim has already made $178.5 million, which means it's getting really close to breaking even, without the DVD sales. That's only after the second weekend too, I expect if we give it another week or two that number will be even higher, and it will probably end up making a profit on its own without the DVD sales. Which will make me really happy if it does :D

It's not even close to breaking even. The boxoffice numbers are the gross figures, or how much money people have handed over to the cinemas. The cinemas take their cut, which the common rule of thumb is 50%, which puts the amount of money WB/Legendary will receive so far under $100mil vs. the reported $190mil budget.

On top of that, the budget is only the production budget and does not include the costs of Prints and Advertising. When the MPAA stopped releasing data on P&A budgets in 2009 the average spend per movie was $65million - you can imagine for a summer movie positioned as a blockbuster Pac Rim's budget would be much higher than that, and costs would have probably increased over the last 4 years instead of decreased. So all-in the cost of Pac Rim would probably be in the region of $300mil and would need ~$600mil in boxoffice gross to break even just from ticket sales.

You're right, my numbers were low and I was just looking at the raw production budget and Pacific Rim does need to make quite a bit more to break even. In the interest of accuracy, I consulted with a family member who works in the industry to see if you were right about the numbers and while my numbers are too low, yours are too high. By your numbers Man of Steel (having a higher budget than Pacific Rim and all) would have to make even more than $600 million just to break even, yet its already been considered a big commercial success.

The %50 cut figure isn't completely accurate, it is in most cases but the big studios have different arrangements and in the case of big studios like Warner Bros, its often closer to a 30/70 split rather than 50/50 (reason is because more people go to the bigger well known movies).
And with the Prints and Advertising costs, the costs in general have actually decreased. Advertising cost has remained about the same, but the print costs have gone down because most movie theaters are digital now, they don't have to print out as many film rolls.

But anyways, the rule of thumb for how much a movie needs to make to breaks even (including all th P&A stuff) is actually that it has to make back double the production budget, so in Pacific Rim's case it'd actually be around $380 million to break even.

True, in the US larger studios can command a higher split for the opening weeks (which then changes in favour of the cinema for later weeks), but for international the split can be even less than 50% - studios have extraordinary trouble getting money out of China for example. Hence the 50% rule of thumb.

Also, "my" math was breaking even on ticket sales alone - you're correct that double the production budget is usually a sign of profitability. But that's because the assumption is that theatrical covers the production costs and ancillary covers the P&A. The common thing in movie threads is someone says a movie is already in or close to profit due to ticket sales (which is what your original claim was), which is pretty damn rare (and usually reserved for low budget Saw/Paranormal Activities, or the billion dollar Hobbit/Iron Man/Avengers club).

What I'm saying is that Pac Rim still has a way to go before profitability. While it's true that it is doing well in international, just to keep it in perspective it's a grand total of $1mil ahead of where Battleship was for international at this point - and we know how the success of that movie was perceived.

 Pages PREV 1 2

Reply to Thread

Log in or Register to Comment
Have an account? Login below:
With Facebook:Login With Facebook
Not registered? To sign up for an account with The Escapist:
Register With Facebook
Register With Facebook
Register for a free account here