The film industry is a multibillion dollar industry where a movie that is good and very well marketed can gross hundreds of millions in revenue within just a couple of months of its release. This is why this industry has attracted a huge investment from venture capitalists and other types of investors who are looking to make a good return.
In this article, we are going to look at the 4 ways films generate revenue.
1 From ticket sales
The distribution company that has been licensed to distribute the movie will often get into agreements with various cinemas on how to split the revenue that is earned from ticket sales. This means that whenever people watch a movie at a screening, the cinema will only keep a percentage of the money and an agreed amount will go to the distribution company which will in turn remit this revenue to the owner of the film.
2 From movie sales
Whether a person downloads, rents, or buys a movie on DVD or Blu-ray, this money usually ends up in the hands of the owners of the film. Movie sales from the different platforms usually form a part of the distribution chain and the idea is always to get the movie in front of as many buyers as possible. Generally, once a movie has been screened at the cinemas, it will be available for release on other platforms soon after.
3 Through TV and streaming services
Once the distribution company is confident that they have met their target for the movie screening at the cinemas, they will then starts showing the movie on TV or on other streaming services. This is another revenue source because it’s accessible by the masses through various pay services and this money will make its way back to the owners of the movie.
4 Through product placement
When watching a movie, you will always notice some big brands being showcased in the film whether it’s a car, a beverage, shoes and many more. This is never a coincidence, as the brand has actually paid to be in the movie. This is usually a form of visibility for brands and a revenue stream for movie owners.
There are of course other ways films will make money but these are the four notable ways we thought we’d share. We trust that it has been an informative piece of information.
Feel free to share with us your reviews of the latest movies as well as your recent experience at the cinema.