Another Way To Make Movies Cheaper: Forget The Stars

from the who-needs-'em? dept

Back in April, at the Cato Institute conference on copyrights, someone in the audience from NBC Universal challenged both me and professor David Levine with the same question: How can the movie industry continue to make $200 million movies without stronger copyright protection? Of course, that's the wrong question. People watching a movie don't care how much it costs to make a movie -- they just want a good movie. Back in May, we noted that one way to make a movie cheaper is to rely on newer technologies that make special effects much, much cheaper, taking out one element of the high cost of making movies. Another point, which Levine stated on his panel, is that a huge part of the budget in $200 million movies is the high cost of paying certain movie stars who are supposed to make the movie a success. Thanks to John for calling our attention to an article highlighting that for all the money that goes to the big A-list movie stars, there's no evidence they help a movie do any better. So, again, it appears that the answer to the guy at NBC Universal is pretty straightforward: don't make $200 million movies any more. That doesn't mean worse movies, it just means learn how to be smarter about spending money.


Reader Comments (rss)

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  1.  
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    dorpus, Aug 29th, 2006 @ 7:55pm

    And join the Europeans/Canadians?

    Europeans/Canadians have spent decades making their terrible low-budget movies with no-name actors, but there is no evidence of their success. Global markets continue to be dominated by high-budget movies made in Hollywood, Hongkong, and Bombay -- the audience can tell the difference.

     

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    English Pro, Aug 29th, 2006 @ 8:29pm

    Good point

    Just because an actor is in ONE blockbuster seems to equate that actor is now astar and demands a huge salary increase. If the studios use "new", good, actors the quality of the film does not have to be poor. The latest superman flcik used a "no-name" in the lead role with Kevin Spacey in the supporting role. Great move. But why not cast another un-known in that part too. It would have cut down on production cost and I feel the movie would have been just as watchable. Special effects have reduced the cost tremendously while advancing the believabilty of the movie. (think Starwars "1" versus the latest release). In a few more years "Sim one" may be a reality. Take a hint Screen Actors Guild .... the world is changing ... even for the untouchables ...

     

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    Scruffydan, Aug 29th, 2006 @ 8:40pm

    Re: And join the Europeans/Canadians?

    Bombay makes high budget movies? Maybe compared with most of Asia, but not when compared to Hollywood.

    I dont have a clue about Hong Kong though

     

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    dorpus, Aug 29th, 2006 @ 8:45pm

    Re: Re: And join the Europeans/Canadians?

    Yup, they've all improved their market share when they imitated Hollywood's big-budget special effects. Jackie Chan, Jet Li's movies either copy Hollywood techniques or are made with Hollywood help. Japan has also dramatically increased its market share in the past 10 years, when they started making more expensive movies. All the famous Japanese anime movies cost many millions of dollars. Before that, Kurosawa was famous for making horrifically expensive movies that never turned a profit, though he is unquestionably famous.

     

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    michael, Aug 29th, 2006 @ 8:47pm

    Re: And join the Europeans/Canadians?

    he's not disagreeing with anyone on the fact that hollywood might have higher production standards then the other movie industries out there.

    he's saying keep that standard, just dont fork out 50-100 million dollars on a tom cruise when u can get someone alot cheaper, and better.

     

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  6.  
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    Anonymous Coward, Aug 29th, 2006 @ 8:50pm

    Old Hollywood

    I love movies. I love going to movies. I love the experience of sitting in an audience and sharing in the excitement of the movie. I don't go to movies anymore. I'm not going to rehash the old statement of "back in the day" but I am going to say that actors knew how to act at one time. This is something that I fail to see anymore. I recently re-watched Guys and Dolls (a great movie, BTW) and I got to see something that not a lot of people really think about. I got to see Marlon Brando sing "Luck be a Lady." This is amazing to me because I can't really think of any current "actors" whose voices are not that great but who would still be willing to belt out a great tune with energy and feeling. My Fair Lady still moves me as I watch Audrey Hepburn glide across the screen. John Wayne still acts like how a man should act. I see characters and amazing actors playing characters. In the current Blockbuster crud I see make-up, special effects, and "actors" who have forgotten how to act. I had been in talks to try and open a thatre in my town to show older movies and independent/foreign films, but then a larger company (a pharmacy no less) swooped in and offered more money for the building. I had hoped to make it dinner theatre with less expensive tickets and the chance to make theatre a more enjoyable experience again.

     

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    dorpus, Aug 29th, 2006 @ 8:52pm

    Re: Re: And join the Europeans/Canadians?

    That sounds nice in theory. There are literally a million other Chinese acrobats who are at least as good as Jackie Chan/Jet Li, but who is going to watch a kung fu movie with names they never heard of? Name recognition does, in fact, make that much difference in a film's expected revenue.

     

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    hollywood, Aug 29th, 2006 @ 9:00pm

    you get what you pay for

    What I don't understand is the latest trend in animated movies to hire well known actors for voiceover work. Who cares that the little bear is "insert actors name here". I just don't get it.
    I totally agree with this article, but I also think you get what you pay for. A studio should be more than willing to pay a talented actor a fair share for being in their movie. Lets face... most movies that come out of hollywood are merely business deals with investors looking for a sure thing. They are the ones who want a well known name that they can feel good about dumping their money into a project attached to that name. NO one would have gone to see a movie about snakes on a plane if it were not for "you know who". Me? I'll continue to go to the local independent films where the real "art" is.

     

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    michael, Aug 29th, 2006 @ 9:00pm

    Re: Re: Re: And join the Europeans/Canadians?

    me... have you heard of a movie called ong bak? I'd take that guy over jackie chan or jet li... and i dont say that lightly...

    obviously if a person is good at what they do, like chan and li - they should be in the movies, but nobody is worth that amount of money... no chance..

     

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    Sal, Aug 29th, 2006 @ 9:07pm

    Is it me or are all the movies today remakes or just plane bad ideas?

     

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    itanshi, Aug 29th, 2006 @ 9:08pm

    Another thing, Animation in Japan is made with a sickeningly small budget hollywood wise. $100,000?

    i don't have figures, but if they spend over $600,000 then it could make a headline. The entire industry is like this. Restrictions are encouraging innovation. I dare you to make Linux OS without using the letter 'e'.

     

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    jeff, Aug 29th, 2006 @ 9:16pm

    " I dare you to make Linux OS without using the letter 'e'."

    huh?

     

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    jeff, Aug 29th, 2006 @ 9:17pm

    " I dare you to make Linux OS without using the letter 'e'."

    huh?

     

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    dont worry about it, Aug 29th, 2006 @ 9:20pm

    Check out the movie "The Mariachi" it was made with $7000 by director Robert Rodriguez, better than most of the movies out today using no name spanish actors and a whole lot of heart.

     

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  15.  
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    Anonymous Coward, Aug 29th, 2006 @ 9:40pm

    Re: And join the Europeans/Canadians?

    high budget movies made in Hong Kong? By Hollywood standards films made in Hong Kong have really low budgets. Only a Few "major" pictures cost more than US$10 million.

     

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  16.  
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    dorpus, Aug 29th, 2006 @ 9:52pm

    Re:

    Occasionally, low-budget movies do succeed, and that is to be applauded. However, it should be considered in the context of how many other low-budget movies with no-name Spanish actors went nowhere.

     

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  17.  
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    Michael Long, Aug 29th, 2006 @ 10:05pm

    Serenity

    So? Even a Serenity made with new technology and relatively no-name actors cost $40 million dollars to produce and promote. That's $40 MILLION dollars that has to be recouped somehow.

    Besides, I'm not entirely buying the premise. I mean, it's not like we've done an A/B test and made the same movie, one with a "name" and one without, and tested the results.

    For a while I really liked Michelle Pfeiffer and saw practically everything she made, inlcuding stuff like White Olleander that I wouldn't have seen otherwise. My girlfriend felt the same about Brad Pitt.

    You see, I want to watch GOOD movies. If you can do it for twenty-grand, a k-Mart camcorder, and no-name actors, then go for it... but I'm willing to bet that the odds of making a good film that way are poor.

    One thing to keep in mind is that the top people in ANY profession (doctors, baseball players, singers, insurance salesmane, you name it) are expensive. I don't see why actors should be any different.

    Use a talented writer, add a talented director and producer and experienced actors, riggers, grips, stagehands, set builders, musicians, and so on, and the odds of making a decent film (and getting your money back) go way up.

     

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  18.  
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    bassboat, Aug 29th, 2006 @ 10:14pm

    high cost movies

    The price that the public will pay determines how much these big names get. I couldn't agree more with the article to hire no names and when they think that they are worth $30 million then hire another no name. I for one am sick of these pampered prima donnas in the movie industry, from the owners to the actors. I for one believe that a $2 ticket is a suffient amount to pay for 90 minutes of entertainment. This would bring out so many more movie fans that they would make more money. Expand the pyramid hollywood!

     

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  19.  
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    Josh, Aug 29th, 2006 @ 10:21pm

    Re: Re: Re: Re: And join the Europeans/Canadians?

    I agree with Michael just because a "name" actor makes the movie doesn't make it a good movie. Many elements have to come together to make a good movie. The actors, the director, the script and so on. I've givin' many a cheap Hong Kong kung fu movie a chance and I 've found great ones and I've found really awful ones. I think fame is highly overrated look at a movie like Gigli. Big names but an awful movie by any standards. Except for Chris Walken he was the only thing that was good about that movie and he had what one scene??

     

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  20.  
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    Socrates3001, Aug 29th, 2006 @ 10:31pm

    The movie industry thrives on fans returning to see movies multiple times. This is why the initial weekend that a movie opens is not the one that determines its ultimate success.

    There are plenty of movies that were totes as Hollywood hits that were actually bombs. I believe this is because to much money was spent on special effects and not on plot. For example, the Matrix had a good plot and a relatively small budget. It was a sleeper hit, and I watched it several times. While some people liked the sequels to the Matrix, there was no plot and far to much money in special effects. The special effects were cool, but I never watched the movies again.

    Another example of spending money wisely in movies are the ones the Saturday Night Live (SNL) actors are famous for making. Most of the movies are low budget, and most turned a profit. Each SNL actor relied upon their unique contribution to comedy (often outlandish humor) and a good script to compensate for minimal budget effects. The movies did not gross as much as the "blockbuster hits" but they made a profit.

    Movies do not have to be high budget to be success, they only need to be well written and well acted.

     

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  21.  
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    Mike (profile), Aug 29th, 2006 @ 10:38pm

    Re: Serenity

    So? Even a Serenity made with new technology and relatively no-name actors cost $40 million dollars to produce and promote. That's $40 MILLION dollars that has to be recouped somehow.

    I fail to see how the fact that it cost this one movie $40 million means the official floor for movie making must be $40 million.

    As for how it should be recouped, we've gone over this a hundred times (and you even see others mention it here in the comments). People LIKE GOING TO SEE MOVIES if you make the experience good. So, you can still recoup the money -- even if you offer the movie in many other formats. People like convenience and they like the experience of going out and seeing a movie on a big screen with comfy seats and a nice sound system.

    There are plenty of ways to recoup the costs of a movie, whether it costs $4, $400,000, $40 million or $400 million.

    One thing to keep in mind is that the top people in ANY profession (doctors, baseball players, singers, insurance salesmane, you name it) are expensive. I don't see why actors should be any different.

    No one's saying they should be paid well. The point is that the studios insist they need to pay many millions of dollars, and the economic evidence suggests that the return just isn't there.

    Use a talented writer, add a talented director and producer and experienced actors, riggers, grips, stagehands, set builders, musicians, and so on, and the odds of making a decent film (and getting your money back) go way up.

    No one's saying movies should be made for free. But the point is they don't need to be $200 million affairs.

     

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  22.  
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    Paul`, Aug 29th, 2006 @ 10:48pm

    Big budgets == Success? One word.
    Waterworld.

    Hmm, now, Napoleon Dynamite, Reservoir Dogs, El Mariachi, Desperado. There are many, many more than that but i think you get the idea.

     

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  23.  
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    dorpus, Aug 29th, 2006 @ 10:50pm

    Then how about low-budget Disney?

    Would kids want to go here?

    http://www.happy-page.jp/gazou/147.htm

     

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  24.  
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    Boris Jacobsen, Aug 30th, 2006 @ 1:33am

    European movies

    There are some superb French, Italian, British, etc movies made with a tiny fraction of the typical Hollywood budget. If you've never heard of them it's perhaps because...

    a. (non-British) you're not interested in watching movies with subtitles

    b. the movie studios are to a large extent also the movie distributors, so non-Hollywood films struggle to get a theater release in the USA.

    c. (closely related to b) a big part of the Hollywood budget is spent on promotion. There are lots of great films out there that you've simply never heard of.

     

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  25.  
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    Boris Jacobsen, Aug 30th, 2006 @ 1:41am

    Talent?

    Use a talented writer, add a talented director and producer and experienced actors,

    There's a distinct shortage of truly talented writers in Hollywood at the moment, or at least it's not the talented writers whose films are being made. It's those writers who put in lots of explosions, etc. The Hollywood experience is completely stale for many people of any intelligence.

    I notice you say 'experienced' actors rather than talented. That was a well chosen word. I would never accuse Tom Cruise, for example, of not being experienced....

     

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  26.  
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    Scott, Aug 30th, 2006 @ 6:04am

    Re: Re: Re: And join the Europeans/Canadians?

    Actually, at one point, Jackie Chan and Jet Li were not known either, yet they were in good movies and became stars.

    See - good movies can raise stars....stars can not raise movies.

     

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  27.  
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    rbb, Aug 30th, 2006 @ 6:23am

    Animal House/Star Wars

    And how many of you went to see Animal House just to see its "star," Donald Sutherland? Or Star Wars just to see Alec Guinness?

    I think both movies did quite well with their "no-name" casts...

     

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  28.  
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    Topher3105, Aug 30th, 2006 @ 6:46am

    Re: And join the Europeans/Canadians?

    I think honestly in Canada the problem is that most people making movies here use the Canadian Film and Television tax credit, which I think actually imposes limitations on the budget of your movie, and among other things, where you get your crew and talent from. In Canada, there is a certain insecurity in forcing people to ensure there is x amount of Canadian funding, content, and talent for a given project.

    The bottom line is that if you make a movie based on government handouts with imposed restrictions, you often get you you would expect.

    There is a lot of talent in Canada, not only among actors, writers, directors, and such, but also talented editors, special effects houses, and more. I would like to start seeing Hollywood quality movies coming out of Canada, but MADE in Canada by Canadians, but the problem is that most people seem fixated on getting their tax benefits. So budgets remain low and so too the expectations.

    When it comes right down to it, there are a lot of movies made in Canada funded by Hollywood production studios and they turn out well. The movie was shot in Canada, employed lots of Canadian crew members, used Canadian special effects and editors, and even had Canadian talent in the cast or directing, writing the film, and hey, the movies didn't suck!

    But the moment some Made By Canada movie is funded by the government, the movies have a certain low budget amateur quality to them, even though it might use some of the same crew and cast talent.

    I am not putting down Canadian television and movies in general, as there have been some pretty good successes and cult favourites, but I just tire of seeing bad movies coming out of this country that have the big Canadian Film and Television Tax Credit logo slapped at the end of it. Its like a Stamp of Disproval that almost guarantees crap.

     

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  29.  
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    todd, Aug 30th, 2006 @ 6:59am

    pay based on results

    First of all, big budget films that do well at the box office, does not automatically mean they were big profiting films. So low budget films that do average at the box office will often have a better ROI.

    Anyhow, because it is often hard to determine how well a movie will do, why don't you pay actors a small base salary for production (ie.

     

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  30.  
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    Jim, Aug 30th, 2006 @ 7:55am

    Re: Good point

    I think this could be a step in the right direction. Also, movies "stars" need to be more open to doing smaller budget movies. For instance Johnny Depp in say the Libertine. I have great respect for the man, he has always made good movies, and not all of them are big budget films.

    As for the superman flick, the only reason I even saw the movie was because Kevin Spacey was Lex Luther. If he wouldn't have been in the movie, I would have had NO desire to see it. And for the ridiculous budget, I thought it was a pretty poor film.

    I do agree that the world is changing and hollywood needs to roll with it, or they will be left behind.

     

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  31.  
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    Anonymous Coward, Aug 30th, 2006 @ 9:32am

    Re:

    Waterworld actually made a profit.

    http://www.the-numbers.com/movies/records/budgets.php

    Check out Blair Witch. Now that was profitable. No big name stars, no special effects, camcorder quality. A good movie doesn't need a star. That said, I do watch certain stars, but more for what I expect the movie to be like because they are in it rather then because they are such great actors. Love Stallone movies.

     

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  32.  
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    Sorry, Aug 30th, 2006 @ 11:03am

    Re: Re: Re: Re: And join the Europeans/Canadians?

    Sorry to disagree. As much as us "common" folk would like to think those people are worth that money...sometimes.

    There are truly great actors that not only can "make" a movie, but they will just by association draw a larger audience. Now granted there can sometimes be extremes where people are paid for the name and they add nothing. But could you image how Forest Gump would have been if someone other than Tom Hanks had played it?

    Movie studios are businesses and they can make mistakes just like other businesses that overpay employees, but at the same time, I would think that they go though a cost benefit analysis of who thye hire. If they think that $5 mil to get Tom Cruise will make a $4.5 mil dollar difference over hiring a no-name guy for $500k, then they will make a business decision to use him. Just because YOU would do it for $5000 doesn't mean that what Tom Cruise would add isn't worth that $4,995,000 difference.

    Now, I'll be the first to say Tom Cruise isn't worth it, but that is a seperate story/argument. Your wife/girlfriend might happen to think differently though

     

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  33.  
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    Darryl Collins, Oct 16th, 2006 @ 11:30am

    Movie profits...

    It is very hard to tell by the numbers on http://www.the-numbers.com/movies/records/budgets.php what actually made a profit. How much did the studio spend on promoting Waterworld for instance. The 'rule of thumb' is that a movie should earn back 2-3 times its budget cost to breakeven to account for promotion and distribution costs...

     

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  34.  
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    Josh, Oct 27th, 2007 @ 9:03am

    One small point

    One thing that I think should be mentioned is that having "big stars" sometimes does make a movie (like Adam Sandler movies, or Tom Cruise movies, which would go nowhere otherwise), and sometimes do not (Waterworld, Gigli etc). Also, sometimes movies with "nobody's" can be successful too (The Notebook, Napolean Dynamite). The fact is, unlike with other goods, you can't forecast or predict success in Hollywood, especially when you measure success in profits. You simply don't know what people will like.

    That being said, I really agree with the idea that "star" actors are paid too much. If 20-30% of your budget is to have one or two people around for a few hours every day, then doing badly may be because of bad business sense.

     

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  35.  
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    bill, Dec 18th, 2008 @ 6:52pm

    forget the stars

    Violence, sex, and foul language sell and the bottom feeders and idiots of society will continue to pay to see this type of movie (Note how much Saws 1,2,3,4,etc made as well as The Hills have Eyes and other horror films). Actors and actresses are basically unskilled, throwaway people who should be easily replaced (unlike that of engineers, medical personnel, etc). They aren't that skilled and knowledgable.

     

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  36.  
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    BabyJay, Apr 30th, 2009 @ 7:11pm

    canadian filming

    ummmm canada has produces many great and excellent wwe superstars, singers, models, actors, neil young for instance is canadain, keanu reeves is canadain and trish startus is canadain there all great and are all canadain

     

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