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George Lucas Predicts Death of Big Budget Movies
H_Fisher writes "Before the red carpet had cooled at last night's Academy Awards, George Lucas told the New York Daily News that big-budget movies will soon be history. From the article: "'The market forces that exist today make it unrealistic to spend $200 million on a movie,' said Lucas, a near-billionaire from his feverishly franchised outer-space epics. 'Those movies can't make their money back anymore. Look at what happened with King Kong.'" Lucas' prediction: "In the future, almost everything that gets shown in theaters will be indie movies ... I predict that by 2025 the average movie will cost only $15 million.""
The problems I have with today's movies are:
1. More effects than plot/storyline
2. Hollywood unions controlling costs
3. Acting unions keeping the status quo too long
4. Economic pressures keeping people in their homes
5. New distribution mechanisms breaking down the cartels
In terms of plot, the average Hollywood movie is regurgitated from previous stories -- they even keep the title nowadays! I've seen great low budget movies with new twists and turns, but with lower production quality. My recent trip to Asia and Europe for the past 3 weeks showed me 3 foreign flick that were surprisingly good -- I even suspended disbelief for 2 of them.
The unions in Hollywood are notorious for continuing their blacklist and favoritism controls -- keeping costs high and quality low. In order to distribute a movie in the States, you have to be part of the union's preferred cartels. If you attempt to make a movie outside of their control, you'll generally not see wide distribution. Copyright at its finest, here.
For those who are familiar with my typical rants and raves on Slashdot, this post isn't much different. I'm the sole anti-copyright activist in most threads, and it doesn't hurt me to see copyright failing Hollywood after decades of them abusing their power. The Internet will slowly (or quickly) bring the distribution cartels down, and I can't wait to see what powers come to the artists willing to give up control of their work once it leaves their hands. Money is still there to be made, we just need to find new ways to sell our art without using the force of government to back our profits up.
On the economic pressure side, the usual enemy to movie theatres is gas pricing. I disagree -- gas prices in my home are not up much once you factor in inflation over the past 15 years. Greenspan did this country a huge disservice with his inflationary system -- making the cost of living go up much faster than our wages did. I believe the average home is poorer today than it was 10 and 20 years ago -- when you look at the cost of entertainment versus the available disposable income, you can see why entertainment is failing. Pile on huge consumer debt levels, and most families can't just Charge It! any longer.
In the long run, I see great benefit in the Internet is bringing the average consumer a new level of selection. The victor in this is the consumer -- and those who find new ways to bring art from the artist to the purveyor. I'm looking at all the options myself, as I don't really see much reason to support those (ie, Hollywood) who stole from me over the decades I've lived. I'd rather go see a local theatre production (where the actors and support staff get paid through real ongoing work) than make a millionaire out of someone who acted once and believes they have the right to continue to make an income without making actual repeated work.
George Lucas might be right that Big Budget Movies are dying -- but I think he needs to check his premises. It isn't the consumer that doesn't want to spend money, it is those who have controlled and manipulated the market that have lost the ability to continue their deceit and their monopoly. Information doesn't want to be free, the law of supply and demand just dictates that it will eventually be free in a digital world. There are still billions of people on this planet who will pay for good content, and I'd love to be one of the guys who finds a way to connect the supply with the demand in a profitable way.
Lucas fails to mention what has changed in the viewer or economic system. A relatively short period of time ago, big budget films were often hits. There was a placebo effect, whereby people would have high expectations of a big budget film (despite this often not panning out.... i.e. WaterWorld).. Both the Spiderman and X-Men movies have proved that big-budget films, of late, can score big. It's not just about ticket sales, but merchandising as well. Except for t-shirts and posters, "indie" films cannot compete with the merchandising opportunities of the types of movies that mandate big budgets.
Look at what happened with 'King Kong.'
The problem isn't the budget, its the lack of creativity. 'King Kong' is not a new movie, it is a remake of the 1933 RKO classic. Other big budget films: The Fog, The Nutty Professor, The Exorcist, Charlie's Angels, The Incredible Hulk, X-Men, Spiderman, Day of the Dead, Night of the Living Dead, The Shaggy Dog, The Pink Panther, etc, etc, etc... And lets not even get started on sequels that should've never been made! (Anything that makes over 200m these days is just about guaranteed a sequel, whether is should have one or not)I took a History of Film class in college, and I remember learning about how "lulls" are often preceded by an abundance of recycled plot lines. The mainstream has run out of creative writers. Just about everything is a remake of something that's already been made. That's why independent, low budget films have become more popular. They are more likely to substitute a lack of special effects and big-name, no-talent casts with well developed plot-lines, creative stories, and some damn good acting.
This isn't even that big of an issue in all honesty. The big budget industries are complaining because they're only making an average of $250 million instead of $350 per crappy-remake-of-an-old-tv-show movies. They will go on spoon-feeding shit to the masses and having them eat it with a big grin on their face.
Capitalism: When it uses the carrot, it's called democracy. When it uses the stick, it's called fascism.
Last one I saw in a theater was Lord of the Rings trilogy. I find myself buying older films, classics.
Hollywood just doesn't make content for me anymore, so I will gleefully watch its demise.
Being a major book geek, movies tend to be weak sauce compared to a good novel anyway.
But it's more fun to watch a movie drunk than to read a book.
Blar.
This is lucas we are talking about. The same man who made Revenge of the Sith.
He has no business making movies any more, and less making predictions.
Mod me down with all of your hatred and your journey towards the dark side will be complete!
"I'm out of Star Wars ideas."
Ok...according to Box Office Mojo: http://www.boxofficemojo.com/movies/?id=kingkong05 .htm/
King Kong cost $217 million to make. And it's made, worldwide, $544 million. Now, only about half of that goes back to the studio, and there were certainly huge marketing costs, but we've still got DVD and Pay Cable and Basic Cable and Broadcast rights and Video Game Licenses and Merchandised Crappola.
Maybe they're not Titanic-happy, but it's hard to see them crying.
With the computers of 2025, maybe you only need $15M to make King Kong?
Indie films will start taking over once they start making more money than big budget films. Then, everyone will jump on the bandwagon and at some point moviegoers will get as tired of them as much as we are tired of epic flops now. Then, someone will take a chance on a big budget blockbuster that has an excellent story, good acting, and generally does everything right and it will make an exorbitant amount of money. Then, things will trend back to blockbusters. It's no different than any other copycat industry, like sports where general managers will try to remake their teams in the image of this year's champion every year.
And that's what a great deal of movies have been lately. Barely tolerable, stupid plots, that are not good stories and certainly would not stand on their own merit independant of medium, where infusions of cash, breasts, and CG try to make up for this. But in the end, all you get is a really expensive, bad movie, with a few tit shots. Putting the female lead on a trampoline, or just saying fuck it and turning it into a porno would probably be better at that point.
Indie movies don't necessarily have good plots, either. I've seen some pretty bad indie movies lately. Open Water, and the stupid one about the "death" tunnel or whatever were both distinctly worse than porn. In the end, it's all about the story, moreso than anything else. Film techniques and dynamics such as acting, direction etc are important as well, but second to the story.
Want my money? Tell me a good story. Then we'll worry about the CG and breasts. If I just want the latter without a story, I'll get a video game or porn.
And the theater environment is rapidly losing it's appeal for me -- I'd MUCH rather watch a movie at home on my projector than in a theater with people who can't keep quiet during a movie, can't keep their cellphones off inspite of all the warnings and can't control their bladders for 90 mins. So, for me, the incentive to find a version of a movie that I can watch at home has little to do with $$$ and much to do with convenience. And (imho) that's going to be true for everyone as home entertainment centers become cheaper and better. It used to be that there was something to going to the theater for the big screen experience. With that going away, I can't see people really interested in the cinema much at all. Someone let me know if they think people will still be "going" to the movies in 25 years in Japan or the US.
So with the Cinema viewers prefering to watch at home, home distribution is the wave of the future -- and I agree with you again, that will lead to inevitable copyright infringement. So, there's really a window of opportunity for the creators of a film to make money. In the first weeks of a movie's life -- they'll have the best version of it, and that's their chance to make money on it -- as you said, supply and demand. It will eventually be cracked though, and then they'll have to compete against the crack -- agani supply and demand. Certainly the studios will find ways to monetize their product -- that's what they do best -- but if the end sum figure is going to be what a movie can make in a competetive market -- people will not be willing to invest big $$$. These movies have these huge budgets because they have a hope of return on nivestment. Without that hope, the investments will go away, and with them the big budgets.
Fortunately for Hollywood, there are easy places to trim costs. Salaries are crazy, as you mentioned. The entertainment unions are going to be broken because the studios will have to break them. And there will be no more $30M paydays for an actor for one movie. Which is fine by me -- once again, it's supply and demand.
Nothing great was ever achieved without enthusiasm
Hollywood has, for many reasons, certain archetypes that prevent it from being creative. You have the ass-kicking woman who can take on men who are significantly more muscular and in better shape as though they were middle school bullies, the stupid white man (doubly so if religious, which makes him barely 1 dimensional), the thug or post-thug black man, the child who knows it all. There are others, but those are the ones that always strike me as incredibly lame and tired, but they're a standard because they produce reliable results, or seem to anyway.
In the real world, even women with fifth degree black belts in real Tae Kwon Do can often be physically overpowered by muggers who have a biological advantage over them. Religious people have been some of the most intelligent and educated in society (not all, but definitely not fitting the dumbass, wild-eyed zealot archetype), blacks are often these days successful members of the middle class with no connection to "the ghetto", there are many stupid asians who amount to "nothing" in life, kids (especially teens) are often total morons compared to those older than them, etc.
There was some animated comedy a little while ago that featured fairy tale characters like the Big Bad Wolf, but I couldn't couldn't bring myself to watch it because of how horribly archetypal the characters were and how cliche the story was. The sassy, badass little red riding hood (1 point down), the ass-kicking granny (1 point down), the idiotic big bad wolf (1 point down). Then there's the trailer. So typical of hollywood that I couldn't give it the benefit of the doubt. I swear to God they must be pulling these out of a vault where they keep a base story line and let it mutate into several possible storylines like some fast evolving bacteria or fungus.
And when Hollywood does in fact do stories that break a mold, they do it with movies like Brokeback Mountain that they know are going to alienate fans of the genre. Who seriously thinks that that movie won them approval from those who like Westerns? Of all the possible stories, they chose the one break from the norm that in the eyes of most Western fans (I'm generally not one) that shits all over the cultural norm for the genre (gay cowboys). And they wonder why they're alienating their fans and making indie movies more popular. This is, IMO, the tip of the iceberg of what is fundamentally screwed up with Hollywood in a business sense. They take risks where they know they'll be bad for business.
On the day after Crash deservedly took the oscar for best film, hollywood needs to consider how many movies like Crash, Sideways, Munich, Serenity, Sin City, Eternal Sunshine of the Spotless Mind, Open Water, and Sean of the Dead are out there waiting to be made, and which could be made for much less money and make a much better return on their investment than utter piss like Mr and Mrs Smith or the latest Pink Panther.
Not all of the above are cheap films, but none of them had a couple of hundred million thrown at them, and every single one of them made a decent return. Hollywood is run by suits who dole out money to what they belive to be the safest option- a small selection of dead horses which the shamelessly flog (market) into turning a profit.
Someone please, please hand Michel Gondry, Charlie Kaufman, Darren Aronofsky, Guy Richie, and Christopher Nolan ( could go on, but am pressed for time) 100 million dollars each (that's $500m - less than the cost of cost two summer blockbusters) and sit back and watch about 15 great movies happen.
What a summer movie that'd be.
When the posters fear their moderators, there is tyranny; when the moderators fears the posters, there is liberty.
How many movies came out last year with King Kong's budget? Just one.
The "average" cost of a movie is already far, far below $200 million... I would say that the "average" cost of movies is already in the $15-20 million range.
One of the biggest expenses of the movies is actors' salaries. Do anybody here actually believe that the studio execs LIKE paying $20 million to an actor for one film? Of course not, but they are paying the market rate for that actor. Actors draw audiences, so how does Lucas propose that the studios force the big name stars to take a lower salary?
You need to educate yourself about how movie accounting works.
You pay $10 to watch a movie. This is the GROSS.
The exhibitor (eg Cineplex Odeon) take 50% $5 and pass the rest up the chain.
The distributor (eg Lions Gate, Miramax, Gold Circle) take 50% ($2.50) and pass the rest up the chain.
The remaining $2.50 is the PRODUCER'S GROSS.
The A-list actors who have a % of gross take their cut. Say 20%. That leaves $2.
Now that $2 is used to pay off the cost of production ('negative cost') and give the investors a return on their capital. This includes things that have already been paid like producer's fees, actors' fees, writing fees, all the crew costs, etc. The studios usually get a big cut of this because the movie uses their facilities, which they charge out at exhorbitant fees.
Once the negative cost has been recouped (if ever), what's left is PRODUCER'S NET, which is what most people in the movies mean by profit.
As a writer, I usually get 5% of this, sometimes known as 'five monkey points' because only monkeys think they mean anything.
But anyway, the logic of all this is that a movie must make AT LEAST 4x it's negative cost to go into profit. So a $200m movie must gross $800m+ to go into profit.
I'm not wrong. You haven't thought about it hard enough.
This is what plagues the RIAA and MPAA. This is what plagues movie screens and radio. Piracy is a problem, yes, but it's not the reason these big corporate types are losing money is because of the big corporate types. Putting out new colors of the same thing will drag sales out only so much.
I think one of the bigger reasons that Mr. Lucas is right is the ability for novice movie makers to do their own CGI. While it may not be as flashy as the big-budget movies, it's enough to get across the idea, as long as a good story compliments it. For instance, while using StumbleUpon, I found a video for a fan-made parody of Power Rangers called "Emo Rangers". The initial episode (which was all I could find) ran about 18 minutes or so, and had some pretty good effects (certainly better than we saw in the original Power Rangers). Considering that all the group that made it had was a YouTube entry and a domain that forwarded to their MySpace account, I highly doubt they had a large budget.
People are waking up and realizing that they've already seen this plot thrice, and oh now we can predict the plot twist. Shiny objects will entrance people for only so long. Good stories are taking precedence, and this will allow more indie directors to get their turn in the spotlight.
It saddens us when this is something we personally like (Firefly, Arrested Development, Furturama, etc), but the average consumer is showing Hollywood that the current crap story, ton of CG, big-budget approach isn't profitable. Thus it will not be funded unless it is profitable.
No one can predict with perfect certainty whether or not something will be well-done and a success. Lucas's recent works were shit, but the original SW trilogy were very successful and critically acclaimed; Hollywood funded Lucas's new efforts because they want to give people what they want and what sells! Not because they want to force crap on you.
Movies in theaters are indeed gouging in a way, but the costs of showing a movie in a theater have also increased dramatically. Carmike Cinemas has struggled financially for a very long time, believe it or not but owning large buildings in an urban area, licensing the content, and upgrading to the newest AV technologies over and over again is quite expensive. Movie theaters are expensive but it is not a high-profit ripoff scam business, the costs are expensive as well. I hope this will diminish in favor of the home theater and other distrubution methods. The economics here are failing.
In the future Hollywood will continue to try to give you what you want. Pay money for movies you think are excellent and you want to see more of, and support them. Don't support crap. Hollywood is very responsive to economics.
There will always be crap, because not even the people funding the movies can predict how they're going to turn out; they can only read the proposals and evaluate the past performance of the people making them. But they have a larger stake than you or I do in wanting to make sure they succeed. Sometimes this is underhanded, such as not showing a screening for critics with the recent "Ultraviolet" as they realized how much the end product sucked. But the movie industry never wanted it to get to that point, they want to make things that are epic and successful-- after all, that's the most profitable.
Big budget movies will never die, because of this. The investors and production companies will put their resources into maximizing their profits, and most of them really do love film and want to do make great movies. They gamble with the knowledge and dreams they have, they will always lose and win. Avoid the losers and support the winners, and this helps things evolve in the future.
And hey, I don't think Hollywood is abusing their power either. DVDs are great; a high quality version of a movie that even has a great viewing experience on a $20 player. Most of them cost less than music CDs and have a lot of bonus content. Sure, DVDs use CSS, but there's nothing wrong with wanting to protect your content and livelihood either.
Entertainment costs are down, down, down. Electronics are cheaper than ever, and getting the content legally-- via DVD, or new services like NetFlix make movie watching a better experience than in the VHS days, and a more economical one. TVs have dropped in price by almost half since the 80s due to improvements in cost production, and a DVD player costs maybe 20% of what a VCR once did. DVDs cost barely more than VHS tapes used to-- they go up less than inflation. And you can buy older DVDs for less than $5!
Hollywood has stolen nothing. They lose more than you do when a movie sucks. I don't ask you support bad content, but I ask that you do consider supporting things you want to see more of. I recently paid ~$80 for Seasons 1 and 2.0 of Battlestar Galactica, not because I hadn't already downloaded the bittorrents, but because I want to support good content and share it with others.
Finally remember that film is one medium for content alone. There are many ways to tell a story, and if film is not meeting your needs, you can always indulge another.
You seem to be laboring under the delusion that the studios want to give movie stars millions of dollars and just can't wait to shower their largesse on them.
I also have to wonder if you understand capitalism.
The movie studios, if they could have their way, would charge the movie stars to appear in their movies. They pay them millions of dollars because the top-name actors think they are worth it... and they are right. Tom Hanks will pull a lot of people into the theatres, enough to recoup the costs. The expert accounts wouldn't be approving the payouts if they hadn't run the numbers, come to this conclusion, and been proven correct numerous times.
You really can't say this is a sign of some sort of global stupidity or anything, either. There are ~300 million people in this country, and the Hollywood market is much larger than that. It only takes a very slight average preference to have amazing box-office consequences. I don't love Tom Hanks and I won't go to see something just because he's in it, but I do think he is a well-above-average actor*. Take that opinion and multiply it by 300million+ and you've got something.
(*: My personal standard for acting is the ability of an actor to play a character and have the actor themselves disappear. Tom Hanks is extremely good; the difference between Forrest Gump and Jim Lovell (Apollo 13) is pretty big, but I still think I see some Tom Hanks-ness in the similarity. A worse actor is Jennifer Aniston, who seems to play Rachel Greene over and over again. Some of the better actors include Patrick Stewart (who does have a certain force of personality, but the distance between Professor Xavier and one of his Shakespearean roles is quite large), and sometimes the smaller players in sci-fi series are suprisingly capable; I've been extremely impressed by Michael Shanks playing Daniel Jackson in SG-1. Daniel Jackson himself is an almost dead-on impression of the original in the movie (I initially didn't realize they changed actors, because it had been a while since the movie), and he does the traditional character-body transfers extremely well, as opposed to Richard Dean Anderson, who does the understated humor thing well but always seems to be Richard Dean Anderson.
Obviously, this is not most people's standards, who I think want the actor to leak through and then pay for the actor. Thus, the cream-of-the-crop tend to be semi-good actors that people really like. Tom Hanks is, IMHO, a minor anomaly in that I think he's pretty good (although not the best) and he's also pretty popular.)
There are a lot of standard complaints that are thrown around that don't bear out. In behavior finance this is the demonstration of revealed preferences over stated preferences.
Everyone likes to turn to the classic bit on the lack of imagination in Hollywood when there is little evidence that the movie-going masses would have preference for "more imaginative" movies.
First, everyone likes to point at how Hollywood likes remakes. Well this isn't a recent phenomenon. King Kong wasn't just remade in 2005 but in 1976. You could've rented the DVDs for both previous versions and watched them before seeing PJ's version. You can go all the way back to Cecile B DeMille remaking the Ten Commandments and continue on as Hollywood repeated the standard film plots, from sword and sandal standards to Dragnet to... Lord of the Rings. And that brings up the real point:
People don't mind remakes, they just don't want "bad" remakes.
The funny thing is what constitutes "bad". Consider the original King Kong. Everyone will call it a classic. Heck probably more people would call it a classic than have actually seen it. And I bet most of them have no real drive to do so even though its just a Netflix order away. It's because what most people consider "bad" are opinions on effects and film production: less believable special effects, stage-derived pre-Method acting, pre-New Wave static cinematography, etc.
Basically they want special effects. And not just any special effects, modern special effects.
And that isn't even due to the plausability of the effects, just expectation. Compare the movies Cache and Saw: the second is clearly gorier and more violent. It is wall to wall violence and bodycount. The former has only one on-screen death (two, if you count a decapitated rooster). Now what are the reactions to the two? I've been in theaters for both and the little Hitchcockian thriller Cache shocked the audiences more than Saw did. Why? Because it's violence didn't fit into the expecations of the audience. People seeing Saw know what they're going to see; they can put on the mask of fake bravery and laugh at the misfortune of shallow unsympathetic characters. Cache engages the viewer in a completely different way: by that nefarious "character-driven plot".
Of course Saw made hundreds of millions of dollars while Cache showed to small art houses. Saw also spawned a sequel.
And that leads to the emergent behavior of movie goers: they expect repetition. Repetition in effects, in plot, in characters. This is why sequels have been and are so popular. People tire of watching the same movie over again. But they wanted repeated experience. So you take a movie, conceive of a similar plot, rehire the same actors, set designers and let them go. Most sequels are really more serials with the idea of an over-arching plot pretty tenuous. Franchises like Bad Boys, Big Momma's House, American Pie. Disney has made a cottage industry of this, crapping out straight to video releases and cartoons based upon their best received product. Its a fine line of just different enough to make it stand on its own while not so different as to fall outside of expectation.
That last one is the killer, something like only 5% of non-franchise movies recoup the costs of the other 95%. And these are rarely anything special. These are the My Big Fat Greek Weddings of the world. And you can bet the masterminds have sat down and tried to figure out how to franchise those too.
Folks aren't looking for plot-driven, nonstandard movies. Look at the Best Picture nominees this year: Capote, Brokeback Mountain, Crash, Good Night and Good Luck, Munich. Their nominations were out over a month ago and only Brokeback has gone over 75 million. Crash has made 55 after a full year in theaters. Spielberg's Munich has only recouped 45 of the 75 m
What is music when you despise all sound?
Okay, I'm no genius, but it appears that this is set up this way for (wink/nudge) tax reasons. I don't know about KK, but often the distributor is the same corp. as the producer (at least for these large budget deals)??? If not, then I'd bet it's a colluding oligopoly.
I would imagine (or, it wouldn't surprise me to learn...) that there's a 'floating' percentage that the distributor takes to make sure that there is never ANY producer's net (monkey points.. that's funny) and the producer's gross is inline with an average to pay the 20% for the actors. [dammit, where's my tinfoil hat!?]
The corporate structure simply has nifty ways of hiding the money so that the tax take is small (and the ACTUAL profits, paid as owner distributions, wages, and executive loans, are high) and most of the money stays in "hollywood."
I'm no expert, as I mentioned, but I realize when GM reports 'net losses' of $X billion that it's not really LOSSES, but they are able to claim a LOT of exemptions and expenses (some real-- some not).
For your next film, you should forfeit half of your *worthless* 'monkey points' for audit rights... I bet they'd balk.
As evidence of the distributor's collusion, Lionsgate dist. (who doesn't really have a competitor) is basically sucking up all the films that are too risky for mainstream corp. hollywood to finance outright. Then they take the profits (as above) and distribute them to the colluding accounts of the oligopoly. They only buy the rights to the ones that create 'buzz.' This is a 'legit.' mafia... I don't think it's a secret, either.
By the way, thanks for being a writer. I've had fantasies about becoming a writer, but the risk/reward is too low. I'm glad it's working out for you....
The exhibitor (eg Cineplex Odeon) take 50% $5 and pass the rest up the chain.
Unless the chains somehow got more power, this isn't the case.
When I worked for General Cinema in the late 80's, there was a sliding scale for the amount of profit the theater kept. It started out at about 10%, and increased each week the movie ran, and I believe it capped out at 50%. So, a movie had to run 5 weeks to get 50% of the box office ticket.
That's why concession prices are so high...they only made (then) about $0.75 a person for an opening showing. Most movies never stayed running for 5 weeks, so the only place they could recoup costs was to charge a bazillion percent markup on popcorn and soda.