Physical & Digital EST: The Future of Home Video Discussion Thread

[Steedeel]

Originally Posted by Lee A Stewart

That's a film director's opinion. I prefer to look at the numbers that Disney showed for their forecast for the number of total subs at the end of 2024. I already did the math on that for you. Take it or leave it. Makes no difference to me because you are blinded by your hatred of streaming.

You are blinded by your disregard for the cinema experience.

As for the maths? It’s a forecast. Disney can forecast all they like, they need the cinema.

[Anthony P]

Originally Posted by Vilya

And minus the considerable expense of operating and maintaining all of those servers and their sizable internet bandwidth costs.

I would like to know how much they net after expenses for both their box office take and their SVOD services.

I don't know about Disney (nothing forces them to brake things down and can't be bothered to check if they do) but according to Netflix (which in a way is better example since they are closer to the range of subscribers discussed)
https://ir.netflix.net/financials/qu...s/default.aspx

out of 18.3B they made in the first three quarters of 2020 the net income is 2.2B

so that shouild give you an idea

note; obviously in 4 years costs would have gone up and we don't know what Disney will be charging their customers at that time

[Lee A Stewart]

Originally Posted by Anthony P

1) it is netflix they are the biggest by far and not as limited in content

2) assuming Netflix reaches 200M at the end of the year (not there yet with their last numbers) Disney+ lowest would still be 15% more I would definetly consider it far enough

3)you did not even use their lowest limit (assuming you want to keep up the charade that it is reasonable) you went with the number that is 25% more.

I didn't take the lowest, I didn't take the highest. I took a number in between. IMO I believe those numbers will be less than what Disney actually accomplishes by the end of 2024.

not sure what your point is. Can you show me where I said that increasing ticket prices can't have an effect on ticket sales?

Just stating the other side of the coin which you failed to address.

not exactly what they said.

It was EXACTLY what they showed. The lions share of new content is going on Disney+ not into theaters.

1) theaters don't make 50% the reality with some movies the studio gets 100% of the boxoffice for the first few weeks when the rooms are full, theatres make their money from concession stands, amusement and events. The movie is there to attract customers and sold as a loss leader.

That is an old split formula and was abandoned years ago. No sliding scale based on the number of weeks a movie stays in theaters. No 100% for the studio for opening weekend. It's one split which is usually 50/50. And that is just No. America. Overseas where the bigger segment of BO revenue is generated is less than 50/50 due to either country mandates like China (40/60) or the addition of distributors that get a cut of the BO.

2) no, the 24B is not all profit that is the most insane comment I have ever heard. Who is paying for the servers that serve up the movies? the electricity to run (and even worst cool) them 24/7, the internet connection so you can stream the movie and the salaries for all the people that make sure all of that runs correctly.

No business background heh? Who said anything about profit? It's revenue. Disney keeps 100% of the revenue it generates from Disney+. Disney keeps 50% of the revenue it generates from ticket sales to it's movies.

not sure of your point.

Disney has 4 streaming services: Disney+, Hulu, ESPN+ and Star. All generating monthly sub money.

[JohnAV]

Originally Posted by Anthony P

1) theaters don't make 50% the reality with some movies the studio gets 100% of the boxoffice for the first few weeks when the rooms are full, theatres make their money from concession stands, amusement and events. The movie is there to attract customers and sold as a loss leader.

False. Look at ticket price revenue articles. Usually the contracts have theaters less of a cut the first couple of weeks say 30-35% and later weeks it climbs to about 50%.

This is why the pandemic is particularly tough because the studios are suppose to make most of their revenue in first 4 weeks in a normal economy. Having much smaller attendance and being in theaters for weeks results in at least 50% going to theater chains. Concessions is a source of additional revenue, but not a substitute for the contract take afforded movie theaters showing a box office film.

[Vilya]

The purpose of most businesses is to make a profit. Looking at revenue only is myopic. After expenses, what are they really earning? Operating costs matter.

That is why I asked how much do they earn after expenses from both box office receipts and their SVOD services. One is likely to generate more profit than the other. Companies very much care about profits and they like getting them from multiple avenues evoking the old adage: don't put all of your eggs into one basket.

If two products each generate $1 billion in revenue, but one has a 10% profit margin and the other a 25% profit margin, obviously the latter makes the company more money. They enjoy the proceeds from both and they would not want to lose either source of profit.

[Anthony P]

Originally Posted by Lee A Stewart

It was EXACTLY what they showed. The lions share of new content is going on Disney+ not into theaters.

are you expecting TV shows to hit theatres?

That is an old split formula and was abandoned years ago. No sliding scale based on the number of weeks a movie stays in theaters. No 100% for the studio for opening weekend. It's one split which is usually 50/50. And that is just No. America. Overseas where the bigger segment of BO revenue is generated is less than 50/50 due to either country mandates like China (40/60) or the addition of distributors that get a cut of the BO.

do you have a link

[JohnAV]

Originally Posted by Lee A Stewart

Disney keeps 100% of the revenue it generates from Disney+. Disney keeps 50% of the revenue it generates from ticket sales to it's movies.
Disney has 4 streaming services: Disney+, Hulu, ESPN+ and Star. All generating monthly sub money.

Star doesn’t appear until Feb 23 2021 as a addition to non USA Disney + streaming. We’re stuck with 1/3 owned by Comcast Hulu in the states until 2024.

[Anthony P]

Originally Posted by JohnAV

False. Look at ticket price revenue articles. Usually the contracts have theaters less of a cut the first couple of weeks say 30-35% and later weeks it climbs to about 50%.

You say false and then you basically say the same thing I said?
yes some start with the theatre making 30%-35% but there are others where it is making less and others where it made 0% when launched. Yes it does move up to 50% for the theatre(higher if we include second run theatres) but there is a big difference between opening night when the film play on the biggest screens and the most rooms/showtimes and several weeks in when the film is playing in the small crappy screen in the back.

[Lee A Stewart]

Originally Posted by JohnAV

Star doesn’t appear until Feb 23 2021 as a addition to non USA Disney + streaming. We’re stuck with 1/3 owned by Comcast Hulu in the states until 2024.

Disney+ HotStar represents 30% of the 87 million subs Disney+ has. What Disney will do is expand Star(new name) outside of India in Feb, 2021.

[Lee A Stewart]

Originally Posted by Anthony P

are you expecting TV shows to hit theatres?

Do not understand this. Please explain in relationship to what I posted: Lions share of new announced Disney content going to Disney+.

do you have a link

Traditionally, a larger chunk went to the studio during the opening weekend of a film. As the weeks went on, the theater operator's percentage rose. A studio might make about 60% of a film's ticket sales in the United States, and around 20% to 40% of that on overseas ticket sales.

The percentage of revenues an exhibitor gets depends on the contract for each film. Many contracts are intended to help a theater hedge against films that flop at the box office. That is achieved by giving theaters a larger cut of ticket sales for such films, so a deal may have the studio getting a smaller percentage of a poorly performing film and a higher percentage of a hit film's take. You can see the securities filings for large theater chains to see how much of their ticket revenue goes back to the studios.

Studios and distributors generally make more from domestic revenue than from overseas sales because they get a larger percentage. Despite this arrangement, foreign ticket sales became more important in the early 21st century. That is part of the reason why you see more sci-fi, adventure, fantasy, and superhero movies. Action and special effects require no translations. They’re easy to understand, whether you’re in Malaysia or Montana. It is much harder to build a foreign audience for an indie comedy.

https://www.investopedia.com/article...make-money.asp

[Lee A Stewart]

Originally Posted by Vilya

The purpose of most businesses is to make a profit. Looking at revenue only is myopic. After expenses, what are they really earning? Operating costs matter.

That is why I asked how much do they earn after expenses from both box office receipts and their SVOD services. One is likely to generate more profit than the other. Companies very much care about profits and they like getting them from multiple avenues evoking the old adage: don't put all of your eggs into one basket.

If two products each generate $1 billion in revenue, but one has a 10% profit margin and the other a 25% profit margin, obviously the latter makes the company more money. They enjoy the proceeds from both and they would not want to lose either source of profit.

Did you read any of the posts from the Disney Investor Day thread? I screen grabbed all of the financial information that Disney displayed. I believe it's around page 15/16.

Streaming services like Disney+ mimic the old "brain teaser" of: Would you rather have $1 million dollars cash in hand . . . or . . . a penny squared for a month (30 days)?

If you chose the $1 million you lost a ton of money.

The big money only comes in the last two days of the month.

There is another word to be added besides Profit and Revenue . . . Investment.

[Vilya]

Originally Posted by Lee A Stewart

Did you read any of the posts from the Disney Investor Day thread? I screen grabbed all of the financial information that Disney displayed. I believe it's around page 15/16.

Streaming services like Disney+ mimic the old "brain teaser" of: Would you rather have $1 million dollars cash in hand . . . or . . . a penny squared for a month (30m days)?

If you chose the $1 million you lost a ton of money.

The big money only comes in the last two days of the month.

There is another word to be added besides Profit and Revenue . . . Investment.

I do have a question for you: which month has "30m days" ("m" as in "million")? Is it the month of Foreveruary?

Yes, what one does with the money that one has is very important (investment), but so are those oft overlooked operating costs which directly impact how much money one has on hand. Even the largest of companies have to pay their bills, just not their taxes.

[JohnAV]

Originally Posted by Anthony P

You say false and then you basically say the same thing I said?
yes some start with the theatre making 30%-35% but there are others where it is making less and others where it made 0% when launched. Yes it does move up to 50% for the theatre(higher if we include second run theatres) but there is a big difference between opening night when the film play on the biggest screens and the most rooms/showtimes and several weeks in when the film is playing in the small crappy screen in the back.

No. There is no example a movie generates 100% for the studio in a chain movie theater showing. Disney with the Last Jedi drawing huge audiences seemed to reduce the amount to the chains back in 2017. See Disney Lays Down the Law for Theaters on ‘Star Wars: The Last Jedi’ - WallStreet Review

LOS ANGELES—The box-office domination of the “Star Wars” franchise has given Walt Disney Co. unprecedented power over the nation’s movie theaters.

Before exhibitors can begin screening “Star Wars: The Last Jedi” this December, they must first commit to a set of top-secret terms that numerous theater owners say are the most onerous they have ever seen. Disney will receive about 65% of ticket revenue from the film, a new high for a Hollywood studio. Disney is also requiring theaters to show the movie in their largest auditorium for at least four weeks.

Ignoring the terms carries an unusual penalty. If a theater violates any condition of the distribution agreement, Disney can take an additional 5% cut, bringing the studio’s total haul to 70% of sales on a movie likely to gross more than $500 million at the domestic box office.

The case of “The Last Jedi” highlights a perpetual but growing tension between the business partners that bring movies to the public: studios and theaters. Negotiations between the two parties have grown pitched as Disney has become one of the most powerful studios in Hollywood and theaters have lost leverage as box-office sales fall. Box-office revenue is down 5% so far this year.

This was a example of the most a studio has made from the chains.

The only 100% in this equation has to do with concession revenue that goes back to the theaters. Otherwise even if you have a stuffed theater even on early premieres 100% is not going to studios from a movie theater.

[Lee A Stewart]

Originally Posted by Vilya

I do have a question for you: which month has "30m", ("m" as in "million"?) days? Is it the month of Foreveruary?

Damn - a typo. Well - gives you another chance to make fun of me which you love to do! That happened because I wanted to head you off at the pass when I originally typed "a month" and you would say February which only has 28 days. Hoisted by my own petard!

Yes, what one does with the money that one has is very important (investment), but so are those oft overlooked operating costs which directly impact how much money one has on hand. Even the largest of companies have to pay their bills, just not their taxes.

Here lazy - I will save you the effort:

[Steedeel]

Originally Posted by Lee A Stewart

Damn - a typo. Well - gives you another chance to make fun of me which you love to do! That happened because I wanted to head you off at the pass when I originally typed "a month" and you would say February which only has 28 days. Hoisted by my own petard!



Here lazy - I will save you the effort:

You and Alchav should team up.

[Vilya]

Originally Posted by Lee A Stewart

Damn - a typo. Well - gives you another chance to make fun of me which you love to do!

Here lazy - I will save you the effort:

[Show spoiler]

I am not making fun of you, just what you wrote. It were funny to me, that's all.

I am lazy, guilty as charged, but all I was trying to say is that looking at revenue alone is insufficient; you have to include them other thangs: costs, profits, investments, numerology, astrology, and bio rhythms, too.

[Lee A Stewart]

Originally Posted by Vilya

II am lazy, guilty as charged, but all I was trying to say is that looking at revenue alone is insufficient; you have to include them other thangs: costs, profits, investments, numerology, astrology, and bio rhythms, too.

Well - in that case it should be as apparent as the nose on your face! Hollywood movies don't make any profit . . . according to Hollywood!

[Lee A Stewart]

If you have never seen an Annual Report of a major corporation (Disney) and lack basic accounting knowledge, then don't bother reading this - you won't understand it.

But if you have some basic accounting knowledge then you will find it very interesting. It will take some time to get through it, but once you do you will have learned a great deal how a corporation like Disney accounts for itself financially.

https://thewaltdisneycompany.com/app...ual-Report.pdf

[Vilya]

Originally Posted by Lee A Stewart

If you have never seen an Annual Report of a major corporation (Disney) and lack basic accounting knowledge, then don't bother reading this - you won't understand it.

But if you have some basic accounting knowledge then you will find it very interesting. It will take some time to get through it, but once you do you will have learned a great deal how a corporation like Disney accounts for itself financially.

https://thewaltdisneycompany.com/app...ual-Report.pdf

I am enjoying the buzz from my meds too much to read something so painfully dull. Just give me a nice pie chart. Preferably cherry.

[Lee A Stewart]

Originally Posted by Vilya

I am enjoying the buzz from my meds too much to read something so painfully dull. Just give me a nice pie chart. Preferably cherry.

[Show spoiler]

But you were the one reeling off all those expenses and costs like you actually knew something. Now you get the chance to see exactly how they account for revenue, profits, losses, investments, expenses, depreciation etc.

Man Up!