Category Archives: Film & TV

Problems Facing the Film Industry

Red Curtain
Red Curtain by djnorway http://www.sxc.hu/photo/1374248

There is a lot of gnashing of teeth about the future of the film industry given that “Between 2007 and 2011, pre-tax profits of the five studios controlled by large media conglomerates fell by around 40%”.

The business of film making (as opposed to TV) will change. The Internet has disrupted theatrical distribution, home video and home entertainment.

Hollywood has responded to the threat to their business model by pursuing tentpole releases. Big event movies that prop up the bottom line the way a pole props up a tent at the circus. That’s still a broken business model which sees the studios make fewer movies which each carry a greater share of the risk. $300 million USD to make and another $50-100 million to market. Now in the world on mega corporations those numbers are not significant.

The problem is that the large media conglomerates are too big. If they had a movie that cost $25 million to make and market, and it made $75 million that’s a great result. But it doesn’t mean a drop in the ocean for conglomerates that big.

In the long run I expect the film production business will be a big but not huge business. Mature competitive markets eventually generate zero abnormal profits. In the long run mature markets can be measured by return on equity (ROE pr ROCE). I don’t see something as bespoke as film production becoming that reliable. Television drama with it’s focus on reaching 100 episodes can produce a product range over 3 or 4 years.

Public ownership of movie production companies is not a good fit for the model. Smaller companies and smaller movies will always find a way to make money in a smaller market.

Interestingly, are there any publicly listed Art production companies? No, but that doesn’t stop artists from creating work, and the most successful of them making a very good living at it.

28 Days Later

Last Friday, Nella and I saw 28 Days Later directed by Danny Boyle.

This is one of the scariest movies I have ever seen. I see it marketed as a horror movie but that is just plain wrong. Actually horror is correct if you use the pre-splatter film definition of the term. 28 Days Later invokes dread and fear for our heroes. I even considered covering my eyes at one spot. It is all done with suggestive editing. There is hardly any gore (but there is enough to set the scene).

This is the mother of zombie movies. It is also a top flight thriller. Basically a quick incubating and highly infectious virus called Rage is unleashed on humankind. 28 Days after initial exposure, London (and England) is a ghost town. Our hero awakes from a coma to discover empty streets and and super-fast rage-infected zombies. That’s all you need to know without spoiling it. Make sure you sit through the end credits or you’ll miss something important.

Nella and I talked about this movie afterwards for at least an hour. That is how much the movie affected us.

It looks like it was shot on Digital Video and that makes the film even grittier and creepy. It’s like watching video footage of the disaster.

Watch it even if you don’t like horror movies.

Film & TV category

Some of you know I’ve raised risk equity for feature films and independant production companies. Films and television are a passion of mine.

I’ve created the Film & TV category to write about Films and TV. The category probably won’t be too investment focused. I suspect I’ll comment on interesting trends or movies/TV I see.

Note I probably won’t write reviews. That is a skill I don’t really want to develop and there are better sites out there for reviews. Instead I’ll tell you why I reacted to the movie/show.