Tuesday, April 26, 2005

does this mean xXx 4 starring bow wow

an eye-opening slate article reveals the finances behind some of those big budget movies hollywood serves up.

contrary to expectations, financial options actually made angelina jolie vehicle lara croft: tomb raider a low-risk venture for Paramount. using international loopholes, the studio actually receives ~$22 million upfront. further, by pre-selling distribution rights to various countries (where the video game is popular) and a pay television license to showtime, paramounts pockets an mind-boggling ~$70 million.

essentially, the budget of a marketable blockbuster can be paid for in advance.
At no cost to its treasury, Paramount launched a potential franchise—don't forget that sequels can be financed with the same "risk management" techniques.
Time Warner's New Line subsidiary did similar moves for the LotR trilogy
Remember all those stories about how New Line was betting its entire future on the Lord of the Rings trilogy? Not quite. New Line covered almost the entire cost by using German tax shelters, New Zealand subsidies, and pre-sales.
since relatively low cost art house or indie films may not allow for these options, they actually may pose greater risk to studios.

as my title suggests... expect xXx 4 starring bow wow (no more "lil") in our future.

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