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Ok, so I get that a film studio would be willing to charge expenses like Lucas' promotion of Return of the Jedi 3D to their accounts, because its an investment

Ok, so I get that a film studio would be willing to charge expenses like Lucas' promotion of Return of the Jedi 3D to their accounts, because its an investment for future gross profits (but the 'investment' doesn't cost anything, because if they didn't make that 'investment' the money would go to paying net-profit-share actors instead). But how is it advantageous to them to completely waste money on destroying the freeway? The only way I can see this benefiting them is that lie in their accounting and write down the freeway expense as much more than it actually cost.

glenra 15y ago
Suppose you use the same freeway set for exactly two films: (1) the big expensive sequel _Matrix Reloaded_ (2) some cheap indie zombie film (being on an entirely empty freeway in the middle of the day is kind of creepy all by itself) ...and then the set has to be destroyed - a storm knocks it down or the land owners decide they want the space back for some other use. One rational accounting method would be to split the cost evenly between films (or perhaps you could divide it based on how many hours/days of filming was done in that location.) But film #1 (a) made a profit, (b) owes percentages of the profit to people who made the first film. Film #2 lost money and was made by people with less negotiating power than Keanu Reeves, so having it lose more money doesn't benefit the studio. Given this simple case, you'd want to allocate as much of the expense as possible to the first film, leading to court battles over exactly how the cost should be allocated. Was this set used for more hours for film #1? Was it more crucial to the plot for that film? And okay, that might still be manageable. But what doesn't work is to leave the number of films to be shot there open-ended. If the freeway set stays up, the lawyers representing Keanu Reeves can reasonably argue that you intend to make one hundred films there, so the _Matrix Reloaded_ production should only get dinged for 1% of the cost rather than all of it or half of it.
- mhb 15y ago
  I thought they could make films lose arbitrary amounts of money by charging whatever they want to their captive distribution arms.
njharman 15y ago
> completely waste money Money isn't wasted, someone earns it. The studio's want their subsidiary "Movie Construction, Ltd" earn that money rather than anyone else.

glenra 15y ago

Suppose you use the same freeway set for exactly two films: (1) the big expensive sequel _Matrix Reloaded_ (2) some cheap indie zombie film (being on an entirely empty freeway in the middle of the day is kind of creepy all by itself) ...and then the set has to be destroyed - a storm knocks it down or the land owners decide they want the space back for some other use. One rational accounting method would be to split the cost evenly between films (or perhaps you could divide it based on how many hours/days of filming was done in that location.) But film #1 (a) made a profit, (b) owes percentages of the profit to people who made the first film. Film #2 lost money and was made by people with less negotiating power than Keanu Reeves, so having it lose more money doesn't benefit the studio. Given this simple case, you'd want to allocate as much of the expense as possible to the first film, leading to court battles over exactly how the cost should be allocated. Was this set used for more hours for film #1? Was it more crucial to the plot for that film? And okay, that might still be manageable. But what doesn't work is to leave the number of films to be shot there open-ended. If the freeway set stays up, the lawyers representing Keanu Reeves can reasonably argue that you intend to make one hundred films there, so the _Matrix Reloaded_ production should only get dinged for 1% of the cost rather than all of it or half of it.

mhb 15y ago
I thought they could make films lose arbitrary amounts of money by charging whatever they want to their captive distribution arms.

njharman 15y ago

> completely waste money Money isn't wasted, someone earns it. The studio's want their subsidiary "Movie Construction, Ltd" earn that money rather than anyone else.