A suit's eye view on Serenity and sequels

POSTED BY: tiredoldreaver
UPDATED: Sunday, October 30, 2005 18:03
VIEWED: 27731
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TIREDOLDREAVER

Sunday, October 23, 2005 6:56 PM

First time on the board, but have been following with obsessive interest the movie returns. I have zero experience of the film industry, but in my normal life, my company manages various similar budget (£25m +) promotions, and one thing I do know, about sequels/further TV episodes etc. is that it is down to two factors only, namely Risk vs Profit.
Looking at the returns, I heaved a sigh of relief as the cinema takes went past $30million. It's getting into cost management breakeven territory now. Why? Well firstly the production budget is stated as $39million. In my business I would be expected to go in and cost manage that figure, (a)by looking again at all costs, (b)negotiating reductions, discounts off suppliers, etc etc. I would normally be given a small marketing budget and would be allowed to use the savings (after our fees!) to bolster said marketing spend. That, I believe would account for the current advertising spend on Serenity. I'd be hopeful of getting a $39m project in and done and marketed for around $37m.
OK, it's a no brainer if the income is $80m, but then people like me wouldn't exist.The trick is to turn what income you've got into a profit. It's no surprise therefore to see some of the Intrenational film launches cancelled and put straight to DVD.Guaranteeing smaller returns without further significant advertising outlay is sensible.
Income wise, the picture is far from gloomy.I don't know what percentages the studio actually retains (BoxofficeMojo says 55%, posters on this board have said up to 80% in the first couple of weeks). I've estimated therefore a midway percentage, which suggests that the studio has recovered $20m already off $30.5m gate receipts.If I were cost managing this,I would be looking to squeeze this over the next two to three weeks to try and push the studio net up to around $25m. That should be more than achievable. I've seen elsewhere that TV rights are being sold off for 2008 (again a figure of $3m was quoted on this board for US only) and I'm sure there's more to be sold elsewhere. Again, early days but $5m should not be unachievable, seeing as $3m is already in the bag. That leaves the DVD market about which so much has been speculated.Again, I have no expertise in this industry, but given the likely retail price, and industry margins, I would imagine the studio will have set as an absolute minimum, similar sales to the Firefly DVD, and gross margins could be around $12-$14 per DVD. Assuming 500,000 sold (again a figure I got from off the board)it puts the project at breakeven. There are two big plusses to add, however.
1.So far, assuming the stated average cinema ticket price of $6, 5 million people have seen Serenity. That is a real market, and all efforts will be used by the studio to convert as many of those viewers into DVD sales as possible.
2.The strength of the base. The fan base is not going away.It becomes a simple financial equation once more. There's 5 million proven fans out there, willing to pay $6 a movie ticket up to $20 a DVD and points in between.What can Joss/The Studio produce and get in front of those fans, and make a decent return given those financials?
I would think that the studio would be looking at Serenity and further spin offs as a steady banker return over a period of time.

Just my thoughts,and I'm sure others can better refine my figures, but I am very optimistic of a future with Firefly/Serenity.
The key was getting over that $30m gate receipt.

SHINY

Sunday, October 23, 2005 7:37 PM

Quote:
Originally posted by tiredoldreaver:

1.So far, assuming the stated average cinema ticket price of $6, 5 million people have seen Serenity.

Well, that also assumes no repeat viewers, which we know isn't true...

---

Serenity is coming. 9/30/05.

TIREDOLDREAVER

Sunday, October 23, 2005 7:54 PM

True of course....We're all aware of everyone on this board and elsewhere making multiple visits to help the numbers. I'm sure that would dilute the effect, but (a) cinema sales aren't finished yet, and (b)repeat visitors might also be repeat purchasers which would help counter the effect. He says, looking at the 3 Firefly DVD sets in his DVD rack!
I guess it's near impossible to guess what percentage of the ticket sales were repeat visits......

CUB

Sunday, October 23, 2005 7:58 PM

Some very enlightening info from the original poster.

I've no doubt whatsoever that whether or not this Firefly/Serenity franchise continues in one form or another will be a creative decision, not a financial one. In other words, I believe in the end it'll be Joss' decision.

---

"If wishes were horses, we'd all be eatin' steak."

EMBERS

Sunday, October 23, 2005 8:34 PM

Quote:
Originally posted by tiredoldreaver:
(b)repeat visitors might also be repeat purchasers which would help counter the effect.

That is definitely true in my case:
I've been to see 'Serenity' 6 or 7 times...(I'd have to count up my stubbs)
BUT I bought at least a dozen copies of the 'Firefly' DVDs to give to friends & family as gifts (Christmas, birthday, anniversay, baby shower...I was completely obnoxious about it)

I don't expect to buy fewer copies of the 'Serenity' DVD, for one thing they aren't likely to be $35 bucks a pop

Thank you for your encouraging words,
I've felt for some time that we might have to wait a couple of years, until Universal feels they made some profit, before the sequel get made,
But the fact is that we would have to wait that long anyway...
Joss is committed to Wonder Woman and Goners.

But we'll have comic books in the mean time, and we've been patient so far...:

Dec 2002 Firefly is canceled
Sept 2003 Univeral announces a movie will be made
Dec 2003 Firefly DVDs come out
Spring 2004 movie is cast & pre-production news comes out
Summer of 2004 movie is being filled & cast appears w/Joss at comic con
Jan 2005 first advanced screening
May- July additional advanced screenings
July 2005 comic book released

We haven't left or gotten bored

**********************************************
watch the R. Tam Session vids: http://www.hittarivertam.nu/
and buy the 'Serenity' comics published by Dark Horse!

MIKELESQ

Sunday, October 23, 2005 8:57 PM

To me, the most encouraging factor is the sales of the Firefly DVDs since Serenity's release. It's still at #4 on Amazon. This is after the existing fandom has had 2 years to buy their copy. And it's not cheap ($30 online, as opposed to a $20-25 movie). It's outselling Batman and Lost.

The message seems clear: see the movie, and you want to see more.

SIGGGY

Sunday, October 23, 2005 9:23 PM

Tiredoldreaver,

That is a very well thought out and written thread, well done! I hope it is true!

NERDLOVER

Sunday, October 23, 2005 9:46 PM

Quote:
Originally posted by mikelesq:
To me, the most encouraging factor is the sales of the Firefly DVDs since Serenity's release. It's still at #4 on Amazon. This is after the existing fandom has had 2 years to buy their copy. And it's not cheap ($30 online, as opposed to a $20-25 movie). It's outselling Batman and Lost.

The message seems clear: see the movie, and you want to see more.

Who gets the profits off the DVD's? Fox or Universal?

EMBERS

Sunday, October 23, 2005 10:03 PM

Firefly DVDs profits to Fox
Serenity DVDs profits to Universal

**********************************************
watch the R. Tam Session vids: http://www.hittarivertam.nu/
and buy the 'Serenity' comics published by Dark Horse!

STILLWATERS

Sunday, October 23, 2005 10:26 PM

Just off hand does anyone know how Netflix viewings get counted, do they just get lumped in with the video rentals?

Also saw the BDM again this Saturday a matinee showing but it must have had a couple of dozen people and they had moved it to a slightly larger theater than the week before. So we aren't through yet.

Shiny, lets be bad guys!! :)

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