7 ms·

Definitely a well known phenomenon but I'm glad to see more industry professionals acknowledging it and speaking out. I think a lot of the industry's professio

Definitely a well known phenomenon but I'm glad to see more industry professionals acknowledging it and speaking out. I think a lot of the industry's professionals are looking for innovation and a way into the future while the industry itself refuses to provide.

TheCapn 15y ago
I'm glad Wil Wheaton is so vocal about his distain for the industry practices. He holds a lot of respect in many "geek's" minds and is a good spokesperson for many people to get behind. If enough people start raising questions then hopefully we can see more public debate regarding these practices from the general public.
- talmand 15y ago
  As stated before you, this is already a rather well-known practice. What I would like the public debate to be about is how exactly do these people manage to get away with what is essentially fraud and why law enforcement continues to ignore it? Almost every case I've heard of where an actor or director sued the studio for cooking the books; the studio loses. Why is this not considered a criminal practice? If I were an IRS agent, flying-spaghetti-monster forbid, I think I would make a call to the studio after one of these cases to ask about auditing those cooked books. Of course, I've heard stories of studios keeping one set of books for the government and another set for people they owe money. Which goes back to that whole fraud thing. Also, it's not just the movie/tv industry that does this. Just about any major industry that involves a content creator having a relationship with a content distributor you likely see the distributor stealing from the creator.
  - felipemnoa 15y ago
    I believe that they spend all of their money on other companies that they own. i.e. Like a TV station where a lot of advertisement is done. Those TV stations have to pay taxes of the money earned. Even if money is lost by the film the contracting companies still have to make money (or their employees), and those are the ones that pay taxes. As long as they report where all the money is going it probably is not a problem. Somebody eventually makes some money and as long as that money pays taxes the IRS is probably OK with it. Knowing that this is how the game is played the actors just have to ask for a big pay check so that it works out the same at the end, more or less.
    - talmand 15y ago
      For years now I've assumed that's why A-list actors get such huge paychecks upfront, because they know they'll miss out if they're supposed to get percentage on profit. But advertising costs has been one of the "excuses" I've seen why a movie fails to make money. I find that doubtful since the majority of advertisement spending is at the beginning of a movie's lifespan. Many movies continue to generate revenue years after theatrical release due to sales outside of movie tickets such as DVDs or streaming licenses. In the end, I still have to wonder why such practices are continued to be ignored when they seem so suspect to begin with. Don't forget that the IRS is probably willing to spend a million dollars to squeeze that extra thousand bucks out of you, so I doubt they would just be OK with what they get.
      - felipemnoa 15y ago
        They could be pulling a Madoff. I still wonder how he got away with it for so long.
        talmand 15y ago
        If run correctly a Ponzi scheme can last a long time. As long as you can keep new people paying into the scheme then it keeps going. Ultimately the scheme falls apart when either someone takes a good hard look at the books or people quit paying in. The key is to not let anyone realize it's a scheme to begin with. Hollywood accounting isn't quite like that since almost everyone understands that they do it.
  - dblohm7 15y ago
    By the studio "losing," in the majority of instances it's because the studio settled. They don't want to actually have this kind of stuff exposed and proven in court.
    - talmand 15y ago
      I'm too lazy to dig them up but I'm pretty sure these practices have been proven in court. I want to say the lawsuit against Newline by Peter Jackson did go to court and the court found that Newline did in fact hold money back from Jackson by a rather large amount. But it's been a while and I'm hazy on the details. Regardless, as we've said, this is already a rather well-known practice so it's not like it has to be proven that much anymore.
- untog 15y ago
  Devil's advocate: would Wheaton be speaking out in this way if he were more successful actor? I don't for a second mean to talk down his accomplishments- he's an author, blogger and even TV personality these days- but now that he doesn't rely on his acting career he can talk out against Hollywood accounting. I would imagine that other middling-successful actors would worry about doing that, as Hollywood could easily refuse to hire them and destroy their career. I guess what I would like to see is someone like George Clooney, Brad Pitt, etc. speak out about this kind of stuff. They're big enough that I don't think Hollywood could shut them out, and they're also successful enough that I don't think Hollywood accounting affects them so much personally. But they could speak out on behalf of lesser known actors.
  - ThomPete 15y ago
    Does it matter?
  - Natsu 15y ago
    > Devil's advocate: would Wheaton be speaking out in this way if he were more successful actor? How successful? Courtney Love also complained about this ages ago: http://www.techdirt.com/articles/20100712/23482610186.shtml http://www.techdirt.com/articles/20100712/23482610186.shtml And Wikipedia also has a whole list of lawsuits over it: https://en.wikipedia.org/wiki/Hollywood_accounting https://en.wikipedia.org/wiki/Hollywood_accounting For example, on paper, Harry Potter and the Order of the Phoenix lost $167 million dollars. How bad is that? Well: "Order of the Phoenix is the unadjusted 15th highest-grossing film of all time, [...] The film opened to a worldwide 5-day opening of $333 million, fourth all-time, and grossed $939 million total [...]" But you have a point. The people who aren't that successful can't afford to rock the boat. But the people who are successful have less incentive to want to, because it no longer affects them as badly. They can demand cash up front and worry less about the alleged financials of the work.
  - blahedo 15y ago
    > They're big enough that I don't think Hollywood could shut them out, Most of us on this board are probably too young to remember the blackballing of (accused) communists in the 50s and 60s, but that put a permanent end to the career of some fairly big stars of the time. The context is somewhat different, but I think if the (perceived) threat is big enough that there isn't really any actor that's too big to shut out.

TheCapn 15y ago

I'm glad Wil Wheaton is so vocal about his distain for the industry practices. He holds a lot of respect in many "geek's" minds and is a good spokesperson for many people to get behind. If enough people start raising questions then hopefully we can see more public debate regarding these practices from the general public.

talmand 15y ago
As stated before you, this is already a rather well-known practice. What I would like the public debate to be about is how exactly do these people manage to get away with what is essentially fraud and why law enforcement continues to ignore it? Almost every case I've heard of where an actor or director sued the studio for cooking the books; the studio loses. Why is this not considered a criminal practice? If I were an IRS agent, flying-spaghetti-monster forbid, I think I would make a call to the studio after one of these cases to ask about auditing those cooked books. Of course, I've heard stories of studios keeping one set of books for the government and another set for people they owe money. Which goes back to that whole fraud thing. Also, it's not just the movie/tv industry that does this. Just about any major industry that involves a content creator having a relationship with a content distributor you likely see the distributor stealing from the creator.
- felipemnoa 15y ago
  I believe that they spend all of their money on other companies that they own. i.e. Like a TV station where a lot of advertisement is done. Those TV stations have to pay taxes of the money earned. Even if money is lost by the film the contracting companies still have to make money (or their employees), and those are the ones that pay taxes. As long as they report where all the money is going it probably is not a problem. Somebody eventually makes some money and as long as that money pays taxes the IRS is probably OK with it. Knowing that this is how the game is played the actors just have to ask for a big pay check so that it works out the same at the end, more or less.
  - talmand 15y ago
    For years now I've assumed that's why A-list actors get such huge paychecks upfront, because they know they'll miss out if they're supposed to get percentage on profit. But advertising costs has been one of the "excuses" I've seen why a movie fails to make money. I find that doubtful since the majority of advertisement spending is at the beginning of a movie's lifespan. Many movies continue to generate revenue years after theatrical release due to sales outside of movie tickets such as DVDs or streaming licenses. In the end, I still have to wonder why such practices are continued to be ignored when they seem so suspect to begin with. Don't forget that the IRS is probably willing to spend a million dollars to squeeze that extra thousand bucks out of you, so I doubt they would just be OK with what they get.
    - felipemnoa 15y ago
      They could be pulling a Madoff. I still wonder how he got away with it for so long.
      - talmand 15y ago
        If run correctly a Ponzi scheme can last a long time. As long as you can keep new people paying into the scheme then it keeps going. Ultimately the scheme falls apart when either someone takes a good hard look at the books or people quit paying in. The key is to not let anyone realize it's a scheme to begin with. Hollywood accounting isn't quite like that since almost everyone understands that they do it.
- dblohm7 15y ago
  By the studio "losing," in the majority of instances it's because the studio settled. They don't want to actually have this kind of stuff exposed and proven in court.
  - talmand 15y ago
    I'm too lazy to dig them up but I'm pretty sure these practices have been proven in court. I want to say the lawsuit against Newline by Peter Jackson did go to court and the court found that Newline did in fact hold money back from Jackson by a rather large amount. But it's been a while and I'm hazy on the details. Regardless, as we've said, this is already a rather well-known practice so it's not like it has to be proven that much anymore.
untog 15y ago
Devil's advocate: would Wheaton be speaking out in this way if he were more successful actor? I don't for a second mean to talk down his accomplishments- he's an author, blogger and even TV personality these days- but now that he doesn't rely on his acting career he can talk out against Hollywood accounting. I would imagine that other middling-successful actors would worry about doing that, as Hollywood could easily refuse to hire them and destroy their career. I guess what I would like to see is someone like George Clooney, Brad Pitt, etc. speak out about this kind of stuff. They're big enough that I don't think Hollywood could shut them out, and they're also successful enough that I don't think Hollywood accounting affects them so much personally. But they could speak out on behalf of lesser known actors.
- ThomPete 15y ago
  Does it matter?
- Natsu 15y ago
  > Devil's advocate: would Wheaton be speaking out in this way if he were more successful actor? How successful? Courtney Love also complained about this ages ago: http://www.techdirt.com/articles/20100712/23482610186.shtml http://www.techdirt.com/articles/20100712/23482610186.shtml And Wikipedia also has a whole list of lawsuits over it: https://en.wikipedia.org/wiki/Hollywood_accounting https://en.wikipedia.org/wiki/Hollywood_accounting For example, on paper, Harry Potter and the Order of the Phoenix lost $167 million dollars. How bad is that? Well: "Order of the Phoenix is the unadjusted 15th highest-grossing film of all time, [...] The film opened to a worldwide 5-day opening of $333 million, fourth all-time, and grossed $939 million total [...]" But you have a point. The people who aren't that successful can't afford to rock the boat. But the people who are successful have less incentive to want to, because it no longer affects them as badly. They can demand cash up front and worry less about the alleged financials of the work.
- blahedo 15y ago
  > They're big enough that I don't think Hollywood could shut them out, Most of us on this board are probably too young to remember the blackballing of (accused) communists in the 50s and 60s, but that put a permanent end to the career of some fairly big stars of the time. The context is somewhat different, but I think if the (perceived) threat is big enough that there isn't really any actor that's too big to shut out.