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SundownInRetreat
09-04-2012, 03:07 PM
This is a question about film sales - not screenwriting - but didn't know where else to post it. I've heard of films racking up presales before general release and that some films - the lower budget ones - can break even on them alone but what are they exctly? They can't be ticket sales because AFAIK you can't prebook a ticket for a film that hasn't been released or even got a release schedule.

Does it refer to the money a distributor pays for the right to distribute? In which case how can that money be counted as profit because the way I understand it, the revenue from ticket sales is split amongst all the player: theatre, studio, investors, and dsitribrutors. So if a film cost $5m to make and has presales of $5m then it could still be a finanical clop because that each party will only get a fraction of that revenue (and I haven't even included the cost of marketing).

Thx

JoeBanks
09-04-2012, 03:23 PM
they are tickets pre-sold by theaters for upcoming releases, afaik. i dont know why you think that they can't be prebooked. hot releases like Avengers, Dark Knight Rises, and Hunger Games make tickets available several weeks in advance of the actual release date

Ronaldinho
09-04-2012, 03:38 PM
Does it refer to the money a distributor pays for the right to distribute? In which case how can that money be counted as profit because the way I understand it, the revenue from ticket sales is split amongst all the player: theatre, studio, investors, and dsitribrutors. So if a film cost $5m to make and has presales of $5m then it could still be a finanical clop because that each party will only get a fraction of that revenue (and I haven't even included the cost of marketing).


Yes. It's the money the distributor is paying the producer.

Generally it's foreign money. I'll pay you $x for the right to distribute your film in France. You're not getting a percentage of the box office - you're getting a flat fee.

And it's up to me to sell enough tickets to make up for that and make a profit.

So if I have presales of $5m, that means I've been promised $5m. Not ticket sales of $5m, but rather a $5m payment from the distributor, who obviously will need far more than that in ticket sales to make up for his own distribution costs, the theaters' share, etc.

SundownInRetreat
09-04-2012, 04:23 PM
Ron,

That's what I thought (dostributor deal), thanks. About the flat fee - I get what you're saying but is it the norm for it to be that simple or are there usually some kind of residual payments worked in the small print - so if the film goes mega (like the old style sleeper hits) then the film makers/financiers they still get a piece of the action?

Levenger
09-04-2012, 04:46 PM
Not for foreign. Usually domestic distribs will give a % of backend but foreign presales are usually a flat fee, as they're often used to help finance the movie in the first place.

wcmartell
09-04-2012, 05:42 PM
What Ronaldinho said.

Foreign distribs pay a flat fee up front - often before the film has ever been made - to lock in a price. This isn't actual money, it's an agreement that can be taken to a bank to secure a loan on the amount the film will make on delivery.

One of the interesting things about the pre-sale method of financing is that it passes on the risk to the distribs. Most famous example of this is BATTLEFIELD EARTH which was a big money-maker... for the producers. They managed to pre-sell the film for much more than it cost to make. Then, the film flopped - but only the distribs around the world lost money. The producers were gearing up to do a couple of sequels and even commissioned the scripts!

- Bill