Is It Well Over 30% As Some Want To Say?
I know I have been away from posting for quite some time. The last year and a half have been extremely busy at FilmProfit. And this spring and summer, I call the Indie Spring! I hope it means well for all of you, and all of your projects. I hope to be posting more here and more often. Thanks for coming by to read this!
I have lately been seeing reports from various folks who comment on the indie film sector, who have wanted to peg the indie portion of the box office at or over 30% year over year for nearly the last ten years. In one case, I saw a chart under a headline that touted indie strength, and the chart showed every year the indie portion of box office in North America at over thirty, with some coming in at closer to 40%.
Now, for the life of me, I cannot find any numbers that would support this. Those of you who know me know I don’t like to just talk off the top of my head, and even when I “gut-feel” something like this, I like to stop and check it out, not just blurt out “wait a dang minute, here…”
So, wait a dang minute here! I went back and did some investigation, to see how it could be that these high numbers were being quoted. I kind of started in the middle, in 2005. Box office total that year for North America, was $8.82 billion, of which, some $40 million was 3D (likely mostly IMAX-style offerings). The total of films released that year was 549, of which 194 were MPAA member releases. Those MPAA member releases brought in an average of $37.3m per film [unless somebody at the MPAA is just flat out lying, which I highly doubt], or $7.236 billion, of the total $8.78 billion (non-3D) in box office. This equated to an MPAA portion of approximately 83% of the (non-3D) box office. So, if the studio films captured 83% of the box office, then how do we get a balance of 30% available to independent films? And, in the other chart touting 30+%, MPAA was cited as a source, so I am comparing apples to apples here.
In 2004, just to go a little bit further, $9.54 billion in box office (according to 2005 MPAA; while 2008 MPAA says $9.2), with 198 titles belonging to the MPAA companies, each averaging some $34.6 million in box office, for an MPAA total of $6,850,800,000, or 72% (approx.) of the box office. Now, this was the year in which one independent film, The Passion of the Christ, accounted for $370 million in ticket sales. So, of the $2.69 billion that could be attributed to independent films, 13% or so, went to one independent film, leaving $2.32 billion for the remaining 321 films. If we exclude Passion of the Christ from the calculation, independent films only account for about 24% of box office for 2004, and even if we include Passion of the Christ in the calculation, independent films still only account for about 28% of box office for 2004. This is as close as I have seen it get to a 30% of box office attributable to indie films.
Now, it is possible to find interesting ways to allocate indie films, and that could result in an argument going round and round about this, but the way I have done it here, and verifiable, is very arguably the natural way.
In relation to the figures claimed by some to be in the 30’s of percent, and to mine, which calculate out to the mid to upper 20’s of percent, I also came across an article from Time Magazine. In November of 2009, Erin Davies said: “From 2001 to 2005 independent film made up around 25% of the total domestic-box-office gross. That percentage has dropped to 18% for [the] year-to-date [in Nov. of] 2009.” I can’t verify this statement by Davies, but it accords much more readily with all of the other evidence around the indie film business, discussion among distributors, and more. So, it would not surprise me at all.
But what is my big point here, after all this calculating, and researching and noodling? The independent film business will not solidify its reputation with investors by feeding its cohorts and investors information that is not based on the real marketplace. A real business plan has to be based on real information, and a plan to make that information work for you. I would never counsel a client to make their film for a budget that does not appear to work with the models available, nor would I try to build a business plan based on a marketplace size that is not there. Using proper models, properly sized markets, and a plan that fits them, is the best path to success.
I would love to know what others think about this post…
Onward and Upward