profitable

Starting with Wolverine, the summer slate of movies should be good business for Hollywood and indirectly for the shareholders of the different companies that are involved in film production.

The problem is that film production is a notoriously risky business and you don’t always get back the money that you invest in it.  With the major studios it sometimes gets hard to see the forest from the trees because they may apply profits from a hit to offset losses from a few dozen dog movies (and I don’t mean the cute woof woof kind of dog movies either).

I’ve talked about movie making before and my thoughts on super hero movies are that they thrive during a Depression as long as the heroes are heroic and the villians are downright nasty.  The old ways, so to speak, are the good ways in the sense that people want a hero that they can root for and a bad guy that they can boo.  Everything else is just short of sugar coating.

Have a great weekend and watch your investments if you are thinking of investing in either film production or entertainment companies that produce movies.

May 09 2009

If you are looking for a day job, part time work, suggestions for saving money or investing, please check out my book, Practical Money Making, that is listed right after his paragraph in this very post.  There are some great suggestions and ways to survive the Depression we are in.

  Practical Money Making-Surviving Recession, Layoffs, Credit Problems, Generating Passive Income Streams, Working Full Time or Part Time and Retirement

Interested in any of my books?  You may want to make a stop over  here. Please click through to purchase my books and some other interesting items that actually ARE on sale.  

Have you read my book, “Bad Tax Idea, Good Tax Idea“?   Please order it today.  The tips inside can save you hundreds if not thousands of dollars!  Tax planning should be done year round and not just two weeks into January or later. 

Part of all the proceeds from the sales of that book  go  to Rett Syndrome research.  One girl is born with Rett Syndrome worldwide every fifteen minutes.   My daughter Arianna has Rett Syndrome and we are working to do all we can to make her life easier and find a cure in her lifetime.  Boys born with the Rett gene generally die at birth.

Kim Isaac Greenblatt

Summer Movies Business Should Be Good For 2009

Question from a reader:”With the summer months coming, I am looking at movie studios stocks to invest in.  The super hero movies are popular and there has to be some payback in either the current business quarter or down the line, right?”

My answer is that isn’t always the case.  The business model for making movies is that generally even in the best possible world, if you are doing a slate of say 25 films you are lucky if you can get 1 or maybe 3 of them tops to be large enough hits to make your money back for all the other 21 or so films that didn’t make money.

Studio debt restructuring is also about trying to make money at the back end through dvd or cable movie sales.  There is extra income at times with cross promotions where companies pay for product placement (Wolverine underoos, things like that).  In cases of movie companies like Marvel, they are a comic book company that is making money through licensing their characters.  They have hit their stride but it took them decades to get the formula right.  Take a look at all the early attempts of Captain America movies and you can see that they didn’t get it right the first few times.

In the case of companies like Marvel, I am not sure how much more upside there is though I think the Wolverine movie will probably go through the roof for them financially.  Will that be enough to cover other debt though?  I will ask that you go through their balance sheets and you decide yourself since I am not a qualified investment person (though I may have some great ideas now and then as well as lousy ones    ).

There is also the chance that one of these days, like Warner Bros discovered, you will make a mega blockbuster like Watchmen and spend millions and not make them back.  Something like that can sting the balance sheet for a company for years and nobody honestly likes to show losses.

In the case of Marvel, they may have a few more super hero movies in them that will be hits but there is always the potential statistically for more flops than hits.  Eventually, people’s tastes change.   There are also production issues that are independent of the content of the film itself that may impact things – say if your star is not available for the movie for another three years.  In companies like Warner Brothers, the DC superheroes have a lot of life in them and they actually have a better track record of television production of their heroes though how that impacts their bottom line with all their movies, etc, or even if they are all under the same holding company is beyond my paygrade of understanding at this point.  You will need to look into this stuff yourself as well – these are just springboard ideas for you  .

People who are playing for short term pops should just watch it because a lot of “blockbuster” income is factored in with the price of the stock and generally the turnaround these days to make their money back and cash has to be within a week or two, especially in the summer where the other blockbusters are fighting for screen time and everybody’s summer dollar.

May 02 2009

If you are looking for a day job, part time work, suggestions for saving money or investing, please check out my book, Practical Money Making, that is listed right after his paragraph in this very post.  There are some great suggestions and ways to survive the Depression we are in.

  Practical Money Making-Surviving Recession, Layoffs, Credit Problems, Generating Passive Income Streams, Working Full Time or Part Time and Retirement

Interested in any of my books?  You may want to make a stop over  here. Please click through to purchase my books and some other interesting items that actually ARE on sale.  

Have you read my book, “Bad Tax Idea, Good Tax Idea“?   Please order it today.  The tips inside can save you hundreds if not thousands of dollars!  Tax planning should be done year round and not just two weeks into January or later. 

Part of all the proceeds from the sales of that book  go  to Rett Syndrome research.  One girl is born with Rett Syndrome worldwide every fifteen minutes.   My daughter Arianna has Rett Syndrome and we are working to do all we can to make her life easier and find a cure in her lifetime.  Boys born with the Rett gene generally die at birth.

Kim Isaac Greenblatt

Motion Picture Companies Investment Idea

An interesting footnote to the economy is that despite the strikes, the high cost of making motion pictures and the Internet cutting into entertainment, movies are going bigger than ever.  I’ve noticed that despite the cash bleed of film production outside of Los Angeles to Canada, Europe, Asia and even other states in this country, there are a lot of movies that have been saving studios.

The mega-blockbuster doesn’t appear to be dead and with the recession/depression we are in, it has been my observation that people will pay to go to the movies.  Sure they can watch and rent on DVD, streaming video, etc but there is still the social aspect of leaving the house to get away from the things that surround them (kids, bills, leaky faucets, etc) and escape to worlds of space ships, bat mobiles and romance.

Studios are cycliing again between boom and bust and a lot of them are just catching up on their cycle of layoffs.  For people in the entertainment division, bad economic cycles are nothing new to them.  The gotcha this time around is that people who work in the entertainment business are now finding that they are in competition with people laid off from other sectors in the part time filler jobs that they try to get to hang on until the next project materializes.

It may be some time for some of the projects to materialize as well depending on how the strike situations get handled.  I would love to see a business model where the studios take a movie and just directly start showing it from the Internet.  Forget about theatrical releases.  I would love to see what kind of sales or rentals, similar to pay-per-view would be generated from taking a hit like a Star Trek movie or a James Bond film and just go straight to a streaming format.  That would be a great metric as to what people would be willing to pay for and how accurate my statement above is about people wanting to go out for their entertainment.

In most major US cities, a first run movie, if seen in the evening is about $10-13 a ticket (US currency) and popcorn and drinks can add another $15-20.  A date for two easily can be $50 just to get into the door and I don’t think that includes parking if you need to pay for it, even if you get a discount for seeing the movie.  A movie rental is a few dollars and you can watch the movie in your underwear though that may or may not make it harder for you to get a date that night.

In good movie making, the producers, writers and directors have to have something that is entertaining enough that people will want to give up two hours (or 90 minutes) of their time and cough up $4 – 13 for.   Studios these days aren’t taking chances with experimental stuff unless it has proved through the Internet or something viral that it will get millions of butts into the seats at the theaters.  Fantasy and super heroic movies do well in times of economic depression.  We should expect the trend to continue for that.  Movies that look to be bootlegged will be released in Asia and Europe first to try and make some money before the cold reality of the marketplace kicks in.  There are people who have a price point of free that don’t want to spend anything for a product.  I wonder if that means that they will work for free for their entire lives.

If you have a decent, low cost documentary, you might have a market for it if you have a nice twist as to the topic that you are covering.  Everything else is being milked to death in the reality tv shows on cable.

Overall, my take on the business of movie making is that it hasn’t really changed during the current economy.   The delivery systems and business models for making a buck may be in flux, but they have been that way since the introduction of VHS tape decades ago and television even earlier than that.  If something is entertaining and people want it, they will find a way to pay for it and see it.

Interested in any of my books?  You may want to make a stop over  here. Please click through to purchase my books and some other interesting items that actually ARE on sale. If you like poker, Heroes (the TV series), comic books, Watchmen, etc, there may be some fast links to get you to what you are looking for.

 If you are looking for a day job, part time work, suggestions for saving money or investing, please check out my book listed below.  Part of all the proceeds from the sales of that book  go  to Rett Syndrome research.  One girl is born with Rett Syndrome worldwide every fifteen minutes.   My daughter Arianna has Rett Syndrome and we are working to do all we can to make her life easier and find a cure in her lifetime.  Boys born with the Rett gene generally die at birth.

  Practical Money Making-Surviving Recession, Layoffs, Credit Problems, Generating Passive Income Streams, Working Full Time or Part Time and Retirement

Kim Isaac Greenblatt

The Business of Movie Making