Superproducer Ted Hope on...

November 15, 2011

Where the Money Goes in Hollywood

Hollywood's accounting practices are so infamously convoluted that you could write a book on them. Two, in fact: author Edward Jay Epstein has written two books on the topic, The Big Picture: Money and Power in Hollywood and The Hollywood Economist: The Hidden Financial Reality Behind the Movies. I read his first book, but by this point my memory's a bit hazy, so listening to the latest episode of the Script Notes podcast by screenwriters John August and Craig Mazin was a great refresher on the topic of where the money goes in Hollywood.

Hit play below or susbscribe in iTunes to listen.

They also published this handy chart:

Link: John August: How movie money works

[via FilmmakerIQ]

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7 Comments

Thank you. Thank you. Thank you. This is exactly what I was looking for.

November 15, 2011

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Will

While, for me, this market model is one I'm familiar with I'd love to see some of the accounting behind the studio's collections as a whole.

What interests me the most are movies who get stuck in development hell only to eventually flop. You think there would be a cut-off point rather than paying to renew options year after year.

One of the overhead costs not mentioned, in this day and age of remakes, is the forensic accounting for finding which studios own which properties. With the rash of mergers and bankruptcies in the late 80s and early 90s, some studios don't even know what they own in terms of some more obscure properties.

November 15, 2011

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Angelo

Read both books... way eye opening. Fee for service... bottomline.

November 17, 2011

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Mowbray

I don't see "legal fees." That's typically a huge chunk.

November 17, 2011

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Jay Bernzweig

This is really only the tip of the iceberg. As more studios got bought by global corps over the past 15 years; likewise with their network tv corps., everything possible from a 1.00 plastic bottle of water being marked off at 10.00 per instead...is ALL on the books. Anyone writing a book on the financing crap of Hollywood has never really seen the multiple sets of books they should be trying to find. If you think the Mafia has a hold on off shore banking in the Caymans, take the same thought to multiple potentialities when dealing with Hollywood. The only true reason any high court, let alone the Supreme Court has never truly sought after the illegal legalities of the Hollywood machine is pretty simply: what is the highest exported American good over the past 25 years? Yes, the American Hollywood studio movie. And all the other little gobbles under the global corporate owned studio umbrella.

November 17, 2011

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MARK11

Yep, the movie producers also own the movie channels, they can show whatever cost they want, both the buyer and seller is the same entity.

November 18, 2011

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Karan Bhatia

Accounting fees.......no doubt, come under "Other Salaries".......

November 29, 2012

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Gary Grizzle