Why Studios Don't Pay to Make Movies Anymore (Analysis)

"John Carter"
"John Carter"

Fewer films, farmed-out risk, less cachet -- why Hollywood now operates under dramatically different rules.

This story first appeared in the Dec. 21 issue of The Hollywood Reporter magazine.

Hollywood film studios have evolved so dramatically during the past decade that it feels as though some are making movies almost reluctantly. As one producer puts it, "Studios are becoming marketing and distribution service companies." Aside from prebranded franchises and sequels, asks another veteran producer, "What is our business about?"

The basic characteristics of a major studio seem simple: the ability to develop, finance, market and release films around the world. "That's not easy to do because it goes to [reaching] other cultures, other languages," says Disney Studios chief Alan Horn. But given the staggering costs of making and marketing films -- not to mention the fact every studio is now part of a larger entity that demands quarterly profits -- it's hardly surprising that nearly half of all studio films released in 2012 had a major financial backer footing at least part of the bill. And even with the partners, certain studios seem almost allergic to making all but the most surefire tentpoles.

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A glance at the numbers conveys at least part of the story: Disney released 13 movies in 2012; 10 years earlier, it released 22. Sony Pictures released 18 titles this year compared with 31 titles in 2002. Not every studio shows such a big drop-off; Fox and Universal have fluctuated in the past 10 years, but the source of the money behind those movies has changed.

Against that backdrop, THR asked executives, filmmakers and agents informally to evaluate the major studios in terms of their commitment to the movie business. Warner Bros. was ranked at the top of the list. The town is anticipating management changes in the weeks ahead, but few expect its culture to change dramatically. Sony also was high on the list, but many note that it seems to be operating under tight fiscal constraints imposed by its troubled parent. At Fox, many saw a difficult culture under former co-chairman Tom Rothman, but it's not clear what to expect from Jim Gianopulos now that he's alone at the helm. There is uncertainty at NBCUniversal as well, since its owners at Comcast have openly shopped for new management and many believe the film studio simply is not a priority for the cable giant.

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Disney also is a complicated equation. Some ranked its live-action studio low, arguing that it now makes films to sell merchandise or drive theme-park attendance. But Horn calls that "unfair." The studio is "the only one that has an identifiable brand that represents a relationship, a covenant with the audience," he says, noting that Disney also is the only major that fully finances all its pictures.

The other studio vying for last place in THR's survey is Paramount, which released only two small films this summer. Vice chairman Rob Moore says that has created the wrong impression. "Anyone can look at 2013 and see we are as much in the game as any other major," he says.

While the terms are debatable and some if not all of the studios are in transition, starting on the next page are charts of activity at the majors depicting how many movies each developed, financed and released in calendar year 2012.

First up: Sony

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