In Hollywood, the math is never simple.
Worldwide box-office revenue rose to record levels last year, the studios’ main trade group said Wednesday — but a closer look at the numbers suggests a murkier picture of movie industry strength.
Movie ticket sales climbed to $9.6 billion in the U.S. and Canada and $26.7 billion globally, both logging 5% increases that demonstrated a “healthy” industry, said Dan Glickman, chairman of the Motion Picture Assn. of America.
The report tends to downplay the actual cost of making movies, however, along with currency fluctuations that benefited Hollywood because of the free-falling U.S. dollar.
For major studios, the average cost of producing and marketing a movie grew 6% to a record $106.6 million, the MPAA said. But that number — based on a survey of trade group members such as
Not considered was the tens of millions of dollars that outside partners such as Relativity Media, Legendary Pictures and Dune Capital Management spent to co-finance dozens of big movies, including last year’s “300″ and “American Gangster.” Studios are turning to partners such as hedge funds and banking firms to share in many of their productions, a strategy that limits their risk but also their potential profits.
Billions have poured into Hollywood since 2004, with all of the big studios and several of the smaller ones taking on partners for at least a portion of their films.
The MPAA has continued to tally only the investments by the studios, a calculation that analysts say glosses over the true expense of making movies.
