2 posts tagged “budget”

LA Times reports that a dozen summer movies will top $100 million just for their marketing costs.  It makes you wonder how much it cost to make the movie itself.  Earlier this year, the MPAA, which normally gives the average studio movie budget for the year, declined to give out the budget statistics for 2008, saying: 

"Year-to-year average costs comparisons are really useless and misleading,'' he said. "I'm not sure what these numbers mean anymore." (Quote from LA Times).  

The biggest marketing cost for the studios is TV ads.  It can cost as much as $3 million for a 30-second spot.  But they say that TV ads are the only way to get a mass audience.

According to the numbers crunched by Thomas Trenker, the founder of Institute for International Film Financing, the theatre-released movies that made a profit are the ones that spent at least the same amount on marketing as they did on making the movie itself.  It's an interesting stat except for the fact that filmmakers and studios regularly lie about their film budget.  For an interesting perspective on the studios lying about movie budgets, check out the LA Times article, Why Everyone Lies About Their Movie Budgets.  The article's author says that studios tend to say the budget was lower than it really was.  In my personal experience, indie filmmakers tend to inflate their budget numbers so it doesn't smell like the backyard production it really is (for the record, I am very pro-backyard production.  I think it's absolutely ridiculous that movies cost as much as they do.).  Many of these indie budget lies can be significant, say, by an order of magnitude...

Susan Ee
www.feraldream.com

I've been asked to put together a budget for a feature film and so I've been calling around trying to find out how much things cost.  Yes, there are such things as pre-made budgets with sample estimates.  That's where I started but it's different in every town and for every script and since this will be a low-budget film, I thought I should get a better idea of how much it would really cost...

WRONG! 

It turns out that everything is negotiable when it comes to movies and nobody likes to come right out and say a price.  This can work for you or against you, depending on who you're talking to, how comfortable you are negotiating and also, like everything else in life, how charming you can be.  Sometimes, there's the stated price on a vendor's website.  But when you call them and spend about 60 seconds with the vendor on the phone, you'll realize that you MIGHT be able to negotiate them down to 80%, 60%, 30%, and yes, even down to $0.  I emphasize the word MIGHT because they offer that tantalizing possibility without actually committing.  I don't blame them because in order to budget for a film, you'd call them months in advance.  But what if they get someone who's willing to pay full price between now and then for the same time slot?  A lot of things can happen in 6 months.  So instead of giving you an estimate, they hem and haw and tell you their favorite movies and chat about their family and in the meantime, they're feeling you out and you're feeling them out... and in the end, you walk away with very few numbers and a gut feeling (or an outright promise) that they'll consider a "fair and genuine" offer when the time comes. 

So how do you know what's a fair offer if you don't know what the market rate is?  You don't.  You guess.  This is the ultimate free market where it's fair when the two of you agree that it's fair.

Do you have to negotiate?  No.  You can pay the price on the website.  But you won't be making a movie.  On a low-budget film, it's negotiate or watch your project get eaten alive by out of control costs.  So today's lesson is:  if you're not the negotiating type, team up with someone who is.  And may the force be with you.