Movie studio

A movie studio is a company which develops, equips and maintains a controlled environment for the making of a film. This environment may be interior (sound stage), exterior (backlot) or both.

Production and Distribution (needs de-merging)

According to a 2000 study by ABN AMRO, only about 26% of Hollywood movie studios' worldwide income came from box office ticket sales; 46% came from VHS and DVD sales to consumers; and 28% came from television (broadcast, cable, and pay-per-view).

Related Topics:
ABN AMRO - VHS - DVD

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Once a movie is completed, the movie studio first releases the movie to theaters, typically opening the movie as widely as possible (over 3000 screens for the largest blockbusters), and backed by a very widespread and expensive television advertising campaign. Attendance for an attractive movie is typically highest in the first week of release, and drops substantially with each successive week. Movie theaters pay a percentage of movie ticket sales to the movie studio as the film rental fee. This percentage can be as high as 90% for certain blockbuster movies, and the percentage drops with each successive week the movie is shown; the average percentage due to the movie studio is about 55%.

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This differs from the practice decades ago in the United States, when a movie was released in a few dozen theaters and spread after receiving good "word of mouth" and good reviews, moving around the country for several years.

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After the movie's theatrical run is almost completely spent, the movie is introduced for sale and rental to consumers, on VHS and DVD. For about six weeks, this is the only way potential customers can watch the movie.

Related Topics:
VHS - DVD

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After the six-week protected window on video, the movie is shown on pay-per-view stations (both on cable TV and satellite TV) for a period ranging from 2 weeks to 3 months. The studio gets around 50% of the resulting income.

Related Topics:
Pay-per-view - Cable TV - Satellite TV

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After this exclusive period, the movie is shown on premium pay TV channels, like HBO and Showtime. The movie studio receives a fixed payment based on the movie's previous performance in theaters, averaging from US$6 million to US$8 million, and reaching US$25 million for some blockbusters.

Related Topics:
HBO - Showtime

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After about 18 months of showing on premium pay TV channels, the movie appears on network television or on a basic cable channel (like TBS, TNT, or USA Network) for 12 to 18 months, or in some cases for several years (ABC and its affiliate networks currently have 10-year broadcast rights to Harry Potter and the Sorcerer's Stone). The network typically pays from US$3 million to US$15 million, depending on the movie and the number of runs.

Related Topics:
TBS - TNT - USA Network - ABC - Harry Potter and the Sorcerer's Stone

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After the network television runs are complete, the movie goes into playout runs on cable before entering television syndication for broadcast and/or basic cable television, receiving payments based on the size of the market that sees the movie, and ranging up to US$5 million in the largest markets.

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In most cases a theatrical film will bypass pay-cable runs for broadcast television because the cost of running these films may be too expensive for such networks as HBO, Showtime, and Starz to run. For example, in the early 1990s, Universal Studios pieced together a package of films for pay-cable networks to acquire. After these networks passed due to its tremendous cost, Universal allowed CBS to acquire the package, thus these films went from pay-per-view cable directly to broadcast television (with obvious edits made due to network standards). Many recent Disney animated films (such as Lilo and Stitch and Mulan) have also bypassed pay-cable runs and have gone directly to broadcast television (in this case, ABC).

Related Topics:
HBO - Showtime - Starz - Universal Studios - CBS - Disney - Lilo and Stitch - Mulan

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On very rare occasions a film will bypass pay-per-view and go directly to broadcast television. In 2000, ' virtually went from home-video release to a broadcast run on the Fox network without ever seeing any premium cable release, although its sequel, ' bypassed pay-per-view and went straight to HBO for its standard pay-cable run.

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