G322: Key Media ConceptsSection B Institutions and Audiences – The Film Industry

Ownership and Production – The Hollywood Majors

• Major Studios are vertically, horizontally and laterally integrated and are now part of massive media conglomerates which has created an ‘oligopoly’ in the film industry, the so called ‘Big Six.’

• Big budget Blockbusters often follow the ‘high concept’ model in order to appeal to a mass audience.

• Films are often sequels, prequels and remakes or based upon a successful book, TV programme or even video game to minimise financial risk and to increase profit.

Distribution – The Hollywood Majors

• Distribution is the most important sector of the industry. • Studios create numerous ‘distribution windows’ in

addition to theatrical exhibition to generate more revenue;

• A successful film brand can be ‘sold’ in a number of different ways apart from theatrical exhibition, for example:

DVD/BlurayOn Demand TVNetwork TVInternet Downloads

Soundtrack albumsVideo gamesNovelisationsMerchandising

Distribution (cont) – The Hollywood Majors

• Conglomerates will try to use synergy within sectors of the corporation to maximise profit.

• For example a soundtrack album could be produced by the record company, a novel could be produced by the publishing house, a video game could be produced within the computer software division etc.

• Synergy is where multiple products and services are created on the basis of a successful brand within the same corporation. Every ‘spin off’ product or service helps create interest in the film, hopefully improving box office receipts and DVD sales.

• More money is spent upon marketing and advertising a major studio film than was previously the case.

• Press junkets are organised by distributors to generate press interest.

• For a major blockbuster the marketing and advertising budget may will exceed production costs in order to stimulate demand and get people into the cinemas/buy DVDs. This would have been unthinkable during the studio era.

Exhibition – The Hollywood Majors

• Big Budget Films are normally released across a large number of screens simultaneously.

• ‘High concept’ films are usually given what is called a saturation or blanket release, this is where a film is released across a huge number of cinemas simultaneously in order to meet expected demand.

• This is because ‘high concept’ films are expected to attract a ‘mass’ audience.

• Most Hollywood films are released widely as they try and cash in upon the huge amount of investment put into producing and distributing them.

• Most of the money made through theatrical exhibition comes through multiplexes.

Exhibition (cont) – The Majors

• Multiplexes are more profitable because– they house a large number of screens

under one roof (reducing staffing costs and other overheads).

– they are usually in close proximity to shopping malls, bowling alleys, bars and restaurants - where they are more likely to attract the casual viewer.

– they can respond to demand more flexibly by showing a popular film on several screens.

– they can provide a more modern and viewer friendly experience.

Ownership and Production – The Independents

• Independent (i.e. not part of a conglomerate) distribution companies sell lower budget art house films.

• These days successful companies that cater for the ‘art house’ market are being taken over by conglomerates, or majors are setting up their own ‘art house’ divisions (e.g. Fox Searchlight).

• This phenomenon has made the term independent a problematic one as it is becoming increasingly difficult for companies to remain truly independent.

• Successful companies are likely to be taken over by a conglomerate, whilst unsuccessful companies may simply go out of business.

                                 

Distribution – The Independents

• Independent films try to get exhibited at film festivals in the hope of being picked up by distributors for wider release. For example the London Film Festival.

• This is because independent productions rarely gain access to the major distribution networks they prioritise more marketable big budget productions.

• At festivals distributors are looking for potential indie successes, whilst producers look to make deals to get their films shown to a wider audience.

• It is very difficult for indie productions to get access to international distribution’

Exhibition – The Independents

• Low budget independent films are often given a very limited release initially, usually in art house cinemas in major cities where there is an audience for more specialist films. This is called platforming.

• If a film proves popular then it may be put out on a wider release. Because the advertising budget for art house films is usually very small; word of mouth, favourable reviews and award nominations are very important in order to create a ‘buzz’.

• Expectations for indie films are much lower than those financed and distributed by the major studios, it is a niche market and exhibition strategies reflect that.

• Many indie films never even make it to the cinema, either going straight to DVD or never reaching a wider audience at all.

Glossary

• Advertising • Paid for promotion such as poster campaigns, TV spots and

trailers.• Art House• Small theatres usually in major cities or towns where

independent, foreign and old films are usually shown as well as or instead of mainstream Hollywood productions.

• Big Six• The major media conglomerates (click on each one see what

they own) Sony, Disney, News Corporation, Viacom, NBC/Universal and Time Warner.

• Blanket release • A release strategy that involves booking a film into as many

theatres as possible simultaneously to cash in on the expected demand created through advertising.

• Conglomerate • A large corporation that includes many smaller companies or

divisions.• Distribution windows • Ways is which a film can be sold beyond theatrical exhibition.

Glossary (cont)

• Film festivals• Events were films are premiered to journalists, distributors and

other interested parties as well as the general public. For independent productions this often provides an important opportunity to access distribution.

• High concept • An approach to filmmaking which prioritises a films

marketability, usually emphasising spectacle, action and stars and using genre in ‘loose’ way.

• Independent

• An ‘independent’ traditionally refers to any company that operates outside of the major studios. This term has become problematic in recent years as independent companies have been taken over by conglomerates, or major studios have set up their own ‘indie’ divisions. In this context the term ‘independent’ is often used to describe a film that is different in its content compared with mainstream productions.

Glossary (cont)

• Horizontal integration • Where direct competitors within the same industry merge. This

reduce competition and costs. • Lateral integration • Where a film studio diversifies into a different industry or

merges with a company in a different industry. Recently it is seen as a way in which conglomerates can create synergy e.g AOL/Time Warner merger in 2001

• Licensing deals • Where the rights to produce a 'spin off product or service are

agreed with another company• Marketing • The overall strategy by which a studio attempts to ‘sell’ a film.

This will include advertising, but will also include audience research, test screenings, previews, press junkets and interviews.

• Multiplex

• An exhibition centre that houses multiple screens under one roof. Usually part of a larger ‘entertainment’ complex.

Glossary (cont)

• Niche• A niche audience or market is one which is narrower

than a mass audience. Independent films often target an audience bored by mainstream films and more interested in character or mood driven films (this audience is often targeted by platforming a film in art house cinemas located in large cities).

• Oligopoly• A state of limited competition that exists when a small

number of companies control an industry.• Pitch • The process of ‘selling’ an idea for a film to a studio in

return for investment and distribution.

Glossary (cont)

• Platforming• A release strategy that involves exhibiting a film in a

small number of cinemas usually in large cities in the hope of building a wider release through word of mouth.

• Press junket • An event organised by the distributor when the press

are invited to interview cast and crew to generate publicity.

• Saturation release • See blanket release.• Synergy • where spin off products and services are created on the

back of a successful film from within the same corporation.

Glossary (cont)

• Vertical integration• Where a company has a stake in production, distribution and

exhibition.• Word of mouth

• Where demand for a film increases because of a positive audience response and recommendation to others.