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Book Report
by
Sean Silverthorne
Perhaps
we are no longer shocked when we read in Edward Jay Epstein’s
engaging look at the business behind Hollywood that most
films lose money at the box office yet still produce profit
through licensing and marketing deals to get those films
into the home.
But
what is surprising after you read this book is that any
good movie ever gets made by a major studio. In business
journalist Epstein’s Hollywood, movies are crafted
for kids and teenagers—they being the ones who control
parents’ spending and who buy all the throw-off products
that movies produce, such as toys, soundtracks, cereals,
clothing, and the like. And can a good movie really emerge
after a scriptwriter is told by a studio exec to make the
villain a martial arts master because kung fu movies are
“hot in Asia”? Or told by the movie star to
include “lots of hardware, huge action scenes”?
Or told by a vice president to carpet bomb the entire concept
and start over?
Close glimpses like these into the sausage-making details
of filmmaking are what really animate an already animated
account and make The Big Picture perhaps the definitive
work on the modern film industry.
Another
compelling aspect of this book is Epstein’s ability
to get his hands on actual studio business documents. We
are told that Disney’s Gone in 60 Seconds, which was
touted to have grossed $242 million at the box office, actually
lost Disney over $160 million after figuring in production
and distribution costs ($206.5 million), the cut from receipts
taken by theaters ($140 million), and Disney’s employee
and interest costs ($59 million).
The modern era in filmmaking actually began in 1937, when
Disney released Snow White and the Seven Dwarves—the
first movie that generated income not only from ticket sales
but also from the music soundtrack and merchandising tie-ins.
Disney invented the future of the industry, says Epstein,
whereby “the real profits would come not from squeezing
down the costs of producing films, but out of creating the
intellectual properties that could be licensed in other
media over long periods.”
Later, he notes, “By 2003 the studios were taking
in almost five times as much revenue from home entertainment
as from theaters.”
Interestingly, the industry has always been vertically integrated:
Studios in the first half of the twentieth century owned
the equipment, studios, actors, and movie theaters. Today,
those assets may reside elsewhere, but the six entertainment
conglomerates that own the major studios—Disney, Sony,
Time Warner, NBC Universal, Viacom, and News Corporation—do
own music and publishing houses, television programming,
and other properties that can take advantage of synergistic
licensing deals.
The book’s epilogue looks at the dawn of the digital
movie, a phenomenon that does away with film, dramatically
decreases distribution costs, lessens the need for those
pesky human actors, and broadens the possibilities for ancillary
products (ring tones anyone?). All of this is bad news for
the adult movie-going public, says Epstein. “To be
sure, there still may be movies made for grown-up audiences
to see in theaters, but they will play an ever-smaller part
in the big picture.”—Sean Silverthorne
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