For those hoping for more pick-ups for The Hobbit, it seems as though we’ve reached the end. In an interview in Las Vegas, Richard Armitage indicated that filming was complete, with only motion capture and ADR work left to be done.Posted in Events, Headlines, Hobbit Book, Hobbit Movie, Hobbit Movie Rumors, Other Events, Peter Jackson, Richard Armitage, Studios, The Hobbit, The Hobbit: There and Back Again, Warner Bros.
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People hoping for a big reveal about The Hobbit: There and Back Again at CinemaCon 2014 will probably come away disappointed by the news that, well, there wasn’t much news at all on that front.
Warner Bros. closed out their 2.30pm presentation with a special recorded message from Peter Jackson, then rolled a new production diary. (more…)Posted in Conventions, Director news, Events, Headlines, Hobbit Movie, Lord of the Rings, Peter Jackson, Production, Studios, The Hobbit, The Hobbit: There and Back Again, Warner Bros.
Box office reporting focuses heavily on ticket sales and revenue numbers. So it’s no secret that (according to latest Box Office Mojo numbers) The Hobbit: The Desolation of Smaug has pulled in just over $944 million in ticket sales.
Profit figures, on the other hand, tend to be more opaque and mysterious.
However, movie website Deadline | Hollywood has crunched some numbers with a number of “experts” as part of its effort to unearth the most valuable blockbuster of 2013. By its calculation, the second film in Peter Jackson’s Hobbit sequence has (thus far) made a profit of $134.1 million.
Just how did they do it?
The Hobbit: Desolation of Smaug profit breakdown. Source: Deadline | Hollywood.
Explaining the earnings
Disregard the calculations for The Hunger Games: Catching Fire in the second column — it’s part of the head-to-head thing that Deadline is conducting.
The first thing to realise (and it took me a little bit of research to work it out) is that that enormous $944 million global box office is split a number of different ways. Nominally at least (Hollywood accounting practises are notoriously dubious), distributors and theatres are taking a goodly chunk of that gross.
Well, according to Deadline’s figures, USA domestic distributors and theatres are taking just under half the domestic box office, while Warner Bros. sees a mere 42.9% of the foreign take and as little as 23.4% of the Chinese gross. The remainder — named Theatrical Rental — is Warner Bros. income. Thus, of that $944.2 million, only $420.3 will make its way to Warner Bros. coffers.
That’s why, according to Deadline, even with other revenues (telly and etc.) factored in, Warner Bros.’ gross revenue from The Desolation of Smaug will hit only (only!) $795.6 million.
Accounting for the expenses
Deadline puts Desolation of Smaug’s production cost at $260 million. I’m not entirely certain how they arrived at that, I’ve seen figures as low as $225 million, and others as high as $295 million (the latter admittedly including printing and advertising costs).
Yet Deadline lists printing and advertising (domestic and international) costs as an additional $155 million.
It’s a puzzle, but this article on io9 gives some insights.
According to Contrino, the Print & Advertising (P&A) costs of a movie can be incredibly high — for a small $20 million film, the promotional budget can be higher than the production budget. That’s because those films are often romantic comedies or kids’ movies, which are cheap to make but still need a lot of promotion. For a film which cost between $35 and $75 million to make, the P&A budget will most likely be at least half the production budget. And the numbers only go up with bigger films. “If the studio spends a lot on the budget, they’re going to want to protect that investment by advertising it heavily,” says Contrino.
If Deadline is correct, the amount invested on marketing The Desolation of Smaug’s around the world clocked in at more than half its estimated production budget.
Rights payments presumably include royalties to the late Saul Zaentz’s Middle-earth Enterprises as well as to Tolkien Estate, while Participations refers to payments to actors, writers and directors as a percentage of either gross or net profit. And overheads seems to be calculated at a straight 15% of the production budget.
According to Deadline, all these factors mean that the total cost of making, marketing and putting The Desolation of Smaug on screen add up to a sizeable $661.4 million.
Return on investment
Which brings us to the bottom line — a profit of $134.1 million. As Deadline calculates, that’s a cash return on cash invested of 20% (134m/661m x 100). It’s a return on investment that as best I can tell compares favourably against other forms of investment — the 10-year (to December 31, 2013) performance of the the S&P 500 is an average annual total return of 7.40%. US bonds, as gauged by the Barclays Aggregate U.S. Bond Index, average 4.55% annually over the same period.
The numbers for The Hunger Games: Catching Fire (an ROI of an unbelievable 200%) illustrate even more starkly (in big, fat $$$ signs) the reason studios relentlessly chase blockbuster success.
Of course, the flipside is the greater risk involved. Stocks and bonds, generally, offer a safer investment. For every profitable film, there’s a long list of grand commercial failures that see studios losing tens of millions of dollars. And that’s the hard calculus under all that creative accounting.
Note: This is mostly an attempt to puzzle out the numbers. I am not an expert (in this area at least). If there’s anything I’ve missed, or seems out of whack, leave a note in the comments or drop me a note at demosthenes at the onering dot net.Posted in Headlines, Hobbit Movie, Peter Jackson, Studios, The Hobbit, The Hobbit: The Desolation of Smaug, Warner Bros.
According to The Hollywood Reporter, Warner Bros. will preview of The Hobbit: There and Back Again at CinemaCon in two days time.
On Thursday at 2.30pm Warner Bros. CEO Kevin Tsujihara, president of domestic distribution Dan Fellman, and president of international distribution Veronika Kwan Vandenberg will showcase a number of the studio’s films that are set to debut this year, including Godzilla, Blended, Edge of Tomorrow, and The Hobbit: There and Back Again. CinemaCon is an annual gathering of USA cinema owners and film distributors. The 2014 edition is being held at Caesars Palace in Las Vegas. (more…)Posted in Director news, Events, Hobbit Movie, Other Events, Peter Jackson, Studios, The Hobbit, The Hobbit: There and Back Again, Warner Bros.
Originally, Peter Jackson intended his adaptation of The Hobbit to be a two-film effort — a duology.
We’ll never know for certain how it would have turned out, but in this feature TORn writer Captain Salt brings together the known facts to give us some idea of just how it might have shaped up.Posted in Adam Brown, Aidan Turner, Andy Serkis, Barry Humphries, Benedict Cumberbatch, Billy Connolly, Casting Rumors, Cate Blanchett, Conan Stevens, Dean O'Gorman, Director news, Elijah Wood, Evangeline Lilly, Graham McTavish, Green Books, Guillermo Del Toro, Headlines, Hobbit Book, Hobbit Movie, Hobbit Movie Rumors, Hugo Weaving, Ian McKellen, James Nesbitt, Jed Brophy, John Bell, John Callen, John Rawls, Ken Stott, Lawrence Makoare, Lee Pace, Locations Sets, Luke Evans, Manu Bennett, Mark Hadlow, Martin Freeman, MGM, Mikael Persbrandt, Peter Hambleton, Peter Jackson, Richard Armitage, Rob Kazinsky, Ryan Gage, Saoirse Ronan, Stephen Fry, Stephen Hunter, Studios, Sylvester McCoy, The Hobbit, The Hobbit: An Unexpected Journey, The Hobbit: The Desolation of Smaug, The Hobbit: There and Back Again, Warner Bros., William Kircher
Digital Trends takes a look at The Hobbit: The Desolation of Smaug and the way director Peter Jackson brought the film’s fearsome, fire-breathing dragon to life.
Building a better dragon in The Hobbit: The Desolation of Smaug
From the moment that plans were first announced for a live-action adaptation of J.R.R. Tolkien’s The Hobbit, fans of the 1937 novel began pondering the ways in which the mighty dragon Smaug could be brought to life on the big screen with all the majesty of his literary counterpart. (more…)Posted in Benedict Cumberbatch, Headlines, Hobbit Movie, Peter Jackson, The Hobbit, The Hobbit: The Desolation of Smaug
The biggest problem –– and this started with Fellowship –– was we had the dreaded F word; we were the fantasy movie, and there was no fantasy movies that ever won for best picture. Russell Schwartz, executive vice president of marketing at New Line Cinema in 2004.
Thanks to Ringer Boromir’s Bane for the heads-up. (more…)Posted in Events, Headlines, Lord of the Rings, New Line Cinema, Oscar Parties, Peter Jackson, Return of the King, Studios
The Hobbit: The Desolation of Smaug has snared seven nominations at the 2014 edition of The Empire Awards. The awards will be announced on Sunday March 30, 2014, in London.Posted in Aidan Turner, Evangeline Lilly, Headlines, Hobbit Movie, Martin Freeman, Peter Jackson, Richard Armitage, The Hobbit: The Desolation of Smaug
We’re delighted to bring you this excerpt from Cinefex’s forthcoming behind-the-scenes account of The Hobbit: The Desolation of Smaug.
Written by Joe Fordham, the 25-page feature draws on in-depth interviews with key effects artists who worked on the film, and is accompanied by behind-the-scenes photos and frame clips — many of them exclusive.
Here’s a little teaser for you! (more…)Posted in Books Publications, Guillermo Del Toro, Hobbit Movie, Merchandise, Peter Jackson, Richard Taylor, The Hobbit, The Hobbit: The Desolation of Smaug
The Academy of Science Fiction, Fantasy and Horror Films has just released the nomination list for the 40th annual installment of the Saturn Awards, and The Hobbit: the Desolation of Smaug has tied with ‘Gravity’ for the most nominations. Both received eight.
The gongs that The Hobbit: the Desolation of Smaug is up for are: (more…)Posted in Benedict Cumberbatch, Crew News, Dan Hennah, Director news, Evangeline Lilly, Events, Fran Walsh, Guillermo Del Toro, Headlines, Hobbit Movie, Howard Shore, Joe Letteri, Other Events, Peter Jackson, Philippa Boyens, Production, Richard Taylor, The Hobbit, The Hobbit: The Desolation of Smaug
If you’re a die hard fan of Peter Jackson’s Middle-earth adaptations, chances are you probably know the name Joe Letteri. Winner of four Academy Awards, Mr. Letteri has been an instrumental part of bringing the magical world of J.R.R. Tolkien’s books to life through the art of visual effects.
Now Mr. Letteri has once again been nominated for his work – this time for The Hobbit: The Desolation of Smaug. The Los Angeles Times’ Cristy Lytal took some time to ask him some questions ahead of the Oscar ceremony – which will be held on March 2nd. Naturally, the interview focused mostly on the creation of the film’s visual centerpiece – Smaug. (more…)Posted in Crew News, Events, Headlines, Hobbit Movie, J.R.R. Tolkien, Joe Letteri, LotR Movies, Miscellaneous, Peter Jackson, Production, The Hobbit, The Hobbit: The Desolation of Smaug, Tolkien, WETA Digital
Read about it here at TORn before this information is available anywhere else! Thanks to Warner Bros. Home Entertainment, we can now bring you all the official information about when you will be able to take home The Hobbit: The Desolation of Smaug. These are the release dates worldwide:Posted in Blu-Ray, Collectibles, DVD/Blu-Ray, DVDs, Ed Sheeran, Headlines, Hobbit Movie, Merchandise, Peter Jackson, Shop, The Hobbit, The Hobbit: The Desolation of Smaug, Warner Bros.