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When's the last time Hollywood film studios 10x'd their revenue? Even looking at global box office, it increased from 23.1B in 2005 to 42.3B in 2019 pre-Covid.
by majormajor 4y ago
When's the last time Hollywood film studios 10x'd their revenue? Even looking at global box office, it increased from 23.1B in 2005 to 42.3B in 2019 pre-Covid.
That's not a growth rate that would attract a VC. Not a lot of new VC-founded studios, as a result. Would you count Quibi?
Netflix, HBO Max, Hulu, Amazon, cable networks, and movies are all competing for a finite set of attention, and there are more other things competing for that attention than ever before too. Netflix has aggressively expanded to compete globally in a way US cable never did, but that still has a ceiling.
If you ten-x'd the amount of 200-million-budget films made in a year you'd similarly hit a wall. At a certain point all you're doing is raising the bar necessary to attract consumer attention, vs attracting new attention and dollars.
- tomcam 4y ago> When's the last time Hollywood film studios 10x'd their revenue? We actually don’t know. They veil the real numbers for each movie in complicated shell and subsidiary corporations and private arrangements that can’t be audited by the public.
- majormajor 4y agoYour claim now is that not just the internal PnL for films is obfuscated but both global box office numbers + public company reporting top-line revenue is as well? If you want to raise a bunch of VC money to open a movie studio because of that, good luck to you, but... doesn't seem like you'll get a lot of bites.
- tomcam 4y ago> Your claim now is that not just the internal PnL for films is obfuscated but both global box office numbers + public company reporting top-line revenue is as well? Where did I make a claim about the top line numbers? > If you want to raise a bunch of VC money to open a movie studio Wut? At this point I’m not sure you’re actually responding to my comment but cheers
- majormajor 4y ago>Where did I make a claim about the top line numbers? The claim I made was about "their revenue" - that's the top-line number. You disputed that by saying we don't know.
- oceanplexian 4y agoIt’s not VC money but you pretty much described Amazon, Netflix, and so on. If they are dumping money hand over fist into original content they probably have a good economic argument for it.
- Invictus0 4y ago..? Hollywood film studios don't 10x their revenue the same way VCs don't 10x their revenue. VCs bet on companies that 10x their investment, and studios bet on movies that 10x their investment. The wins are so big that they enable risk taking on bets that might be flops. It's no different in book publishing or the music industry.