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Old August 19, 2019, 04:27 PM
GordonJ's Avatar
GordonJ GordonJ is offline
Join Date: Aug 2006
Location: West Palm Beach, FL
Posts: 2,642
Default I could have saved time and money.

Originally Posted by Dien Rice View Post
Hi Gordon,

I've read a little bit about Hollywood's "voodoo economics"...

Apparently getting a percentage of the PROFITS is not a good thing to do, because they can wave their voodoo wand (is there such a thing?) and make those profits disappear... So they don't have to pay you anything, if you have a percentage-of-the-profits deal, when the profits are zero...

Apparently, the thing to do is to get a percentage of the GROSS REVENUE (or equivalent), or something measurable which is much harder for them to change...

Profit is Revenue minus Expenses.

Where they can make the profits magically disappear is by adding to the expenses... Like the marketing budget. A great one is having to pay a lot for intellectual property rights.

Let's say Disney makes a Mickey Mouse movie. They may have Company 1 to make the movie, but another separate Company 2 owns the rights to Mickey Mouse.

If they get Company 2 to charge a ridiculously HUGE amount for Company 1 to use the IP rights to Micky Mouse, they're able to magically transfer all those profits from Company 1 to Company 2. That means, if you're being paid a percentage of the profits, it's... "Sorry man, we can't pay you. The movie made a huge loss!"

Harry Potter and the Order of the Phoenix was the sixth highest grossing movie of all time at the end of its run. However... it made a $167 million dollar loss!

The third Star Wars movie, Return of the Jedi, still hasn't made a profit!

The producers of the 1989 movie Batman didn't get paid a cent (until they went to court), because they had a pure percentage-of-the-profits deal... Warner Bros had waved their accounting wand to make the profits disappear... (They eventually settled out of court.)

A great article to read on this is Hollywood accounting on Wikipedia...

Best wishes,


Thanks Dien, the wiki thing is like what my CPA was saying, at a big dollar per hour rate. Wish there was a way to speed up real time talkers (who get paid by the minute) like the old cassettes on Chipmunk speed.

Maybe, I should get into accounting. Or just guerrilla my art, make a movie on my iphone, like others have done.

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