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James Cameron's Avatar cost a lot of money, that much is certain. But how much exactly has been -- and will continue to be -- a matter of some debate. The New York Times explored the topic yesterday in an article where not only the cost of the upcoming mega-movie is discussed, but so is studio 20th Century Fox's plan to buffer themselves from the possible ramifications that could occur if Jim doesn't hit this one out of the Pandora park.
First of all, that price tag. The Times pegs it at the $500 million range, though some are saying that number is inaccurate and way high. Of course, this isn't the first time that a James Cameron film has gotten entertainment-journalist types worked up into a lather as if it's their money that's at play, but we digress…
So let's go with the The Times' figure for argument's sake, which the paper says is for production and marketing. "Avatar may carry surprisingly little financial risk for Fox's parent company, the News Corporation, even if it disappoints," says the story's author, Michael Cieply. "That is because of shifting industry economics, reliance on outside investors and help from a network of allied companies and in-house business units."
(News Corporation is also the parent company of IGN, FYI.)
"Fox's efforts underscore how studios generally have been able to minimize their exposure at a time of blockbuster budgets -- albeit at the cost of limiting their profit potential as well," continues Cieply.
If the film hits a domestic gross of $250 million, which is by no means a stretch, then the studio "would appear to be headed into the black" by Cieply's math. Part of the film's production cost, he says, was funded by the private equity partners Dune Entertainment and Ingenious Media, which kicked in about 60 percent of the budget. Further, Cameron himself agreed to forgo his percentage of the film's box-office take if production costs went too high. Other factors such as tax breaks in New Zealand and the future value of the digital camera technology developed by Cameron for the film also come into play.
Fox is also reportedly catching a break on the marketing side through deals with companies such as IMAX and Panasonic. And then there's also the chipmunk factor -- specifically Alvin and the Chipmunks: The Squeakuel,, which opens a week after Avatar for the studio and is considered a "relatively safe sequel to a chipper family comedy that cost about $60 million and took in $217 million at the domestic box office when it was released two years ago."
source
I may have missed something but what's the big deal about avatar?
First of all, that price tag. The Times pegs it at the $500 million range, though some are saying that number is inaccurate and way high. Of course, this isn't the first time that a James Cameron film has gotten entertainment-journalist types worked up into a lather as if it's their money that's at play, but we digress…
So let's go with the The Times' figure for argument's sake, which the paper says is for production and marketing. "Avatar may carry surprisingly little financial risk for Fox's parent company, the News Corporation, even if it disappoints," says the story's author, Michael Cieply. "That is because of shifting industry economics, reliance on outside investors and help from a network of allied companies and in-house business units."
(News Corporation is also the parent company of IGN, FYI.)
"Fox's efforts underscore how studios generally have been able to minimize their exposure at a time of blockbuster budgets -- albeit at the cost of limiting their profit potential as well," continues Cieply.
If the film hits a domestic gross of $250 million, which is by no means a stretch, then the studio "would appear to be headed into the black" by Cieply's math. Part of the film's production cost, he says, was funded by the private equity partners Dune Entertainment and Ingenious Media, which kicked in about 60 percent of the budget. Further, Cameron himself agreed to forgo his percentage of the film's box-office take if production costs went too high. Other factors such as tax breaks in New Zealand and the future value of the digital camera technology developed by Cameron for the film also come into play.
Fox is also reportedly catching a break on the marketing side through deals with companies such as IMAX and Panasonic. And then there's also the chipmunk factor -- specifically Alvin and the Chipmunks: The Squeakuel,, which opens a week after Avatar for the studio and is considered a "relatively safe sequel to a chipper family comedy that cost about $60 million and took in $217 million at the domestic box office when it was released two years ago."
source
I may have missed something but what's the big deal about avatar?
