Home > Analysis, Copyright, Piratey Stuff, Research > Why the US film Industry is Going Bankrupt.

Why the US film Industry is Going Bankrupt.

About 2 years ago, in the January of 08, I started a little project. It was to look at the box office figures put out by the film industry, and look how p2p had impacted them. I did some initial research, which looked at US box office figures for 1996-2007.

Then, in June 07, I published an initial summery of some of my findings, with the aim that I would try and have the full study finished by the end of July 08. That (obviously) didn’t happen. A mixture of real-life pressures, and ADD kept me from finishing it (plus work on the Pirate Party US/International).

Studies like this were the reason I stepped down from Pirate Parties International. It’s only recently, now that the US Pirate Party has a full board, that I can concentrate once more upon things. So, I’ve updated the box office figures, and included 2008 and 2009 as well as 1990-95 (although some of the 09 films are still showing, so shouldn’t be taken as ‘final’).

One thing I did notice when collecting the figures, were the figures for 2005. This is the year, let’s not forget, where Hollywood claimed to lose $6.1Billion, to “Piracy” (meaning ‘copyright infringement’)

The thing is that while the box office figures for the US were down a bit, they weren’t down by much, especially not when compared to the 90s (before ‘piracy’) What’s more, while they may have lost a claimed $6.1Billion worldwide (1.3Billion of that in the US); the top ten films, of the 547 or so released that year, took in over $5.7B worldwide (and $2.4B in the US).

They never mention their income in the same press release as their claimed losses, and now you know why. They also never include the costs of the films, and there’s another reason. The top 10 in 1990 cost around $316.5Million in 1990 dollars (521.5Million in 08 dollars), which included films like Ghost, Total Recall, and Due Hard 2.

2005’s top 10 films cost a whopping $1.307 BILLION to make by contrast ($1.441Billion in 08 dollars) – 2.7x more. In fact, only two of 2005’s films cost less to make than the most expensive film (in the 1990 top ten, Die Hard 2 ($70M in 1990, $104M in 05 dollars). Those were Wedding Crashers ($40M) and Madagascar ($75M)

When you want to look at a reason Hollywood, and the MPAA feel they’re losing money, it’s the budgets that should be looked at. People are still going, but it’s the expense that drives the profits down.

Many thanks to BoxofficeMojo for lots of lovely data to work with.

Part1 – US Box Office Top10 from 1990-2009

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  1. Kadai
    March 3, 2010 at 01:29

    Actually, I do not think they have any kind of loss at all.

    Lets take it like what it is… the -piracy- is the big excuse to to say “Hey, I’m in red numbers!”, claiming false statements to actually -reduce- the declared income and so (what means, pay less taxes, less salaries… and much more money to swim with)

    All of that is just a fiasco. That kind of industries are actually getting profits from piracy, and big ones, because they get free marketing thanks to it (And I say it as a Master in Marketing) in more than a way, get the profits at the office box plus all the merchandising involved with it. They truly win, but they need everyone think that they actually loss.

    During the first years I believed this, but then when you get older and more wise… you see that this has been the game for a long time.

  2. Wrinkle Treatment :
    November 1, 2010 at 00:40

    the film industry is of course a multi billion dollar business that employs lots of people ”

  1. March 7, 2010 at 15:22
  2. March 29, 2010 at 03:07

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