1. #2521
    Quote Originally Posted by Nekoyou View Post
    Okay, I think I understand what you guys are doing now with the numbers. Actually, I think you guys are mistaken. You don't have to make double your marketing budget to turn "profit" or to "break even". If their marketing budget turned out to be 100 Million then they only need 100 million to cover the cost. That means they do not need to make x2 it to make a profit. In other words if the production cost was 160 M and the marketing cost was 100 M then the formula would be 160 M x 2 + 100 M = 420 M. Not 520 M. Because you don't need to double your Marketing cost to make a profit. Anything over the initial cost for production of the movie plus the marketing cost is a profit. I'm not sure why you guys have been trying to x2 the marketing cost. Is there an actual reason why you guys have been?
    It's because we realize that theaters don't say "oh, that money is for marketing? We'll give you 100% of what we made if it's going for that."

    Theaters take ~50% of the box office, and it's from the rest that everything (including marketing and production) gets paid back from.

    If Wanda is included in the box for which you are computing profit/loss, all the extra expenses of actually running those theaters have to be added in too (in the normal case when the theaters are a separate entity one doesn't care if the theaters make a profit; one assumes they are big boys who can figure out when negotiating the contracts how much to skim off to keep operating.)

    - - - Updated - - -

    Quote Originally Posted by Tackhisis View Post
    The best source to movie's failure is inconvenient silence from the Blizzard officials.
    They probably wrote it off a while ago.

    I found this editorial review in MassivelyOP to be daming.

    http://massivelyop.com/2016/06/13/ed...olutely-awful/

    So yes, I am a fan. And this movie is garbage. It’s stupid. It’s drivel. It’s a film without any sort of clear protagonist. After an hour, I found myself staring at the screen and thinking that I don’t care about any of the people on the screen. I don’t even know them, and I don’t want to. It made the backstory of a universe that I know quite thoroughly seem boring, trite, and even more generic than it already was. It gives me no reasons to care. It fails as a visual spectacle, it fails as a prequel, it fails as a narrative, and it fails in every possible way that a movie can fail.
    Last edited by Osmeric; 2016-07-08 at 10:15 AM.
    "There is a pervasive myth that making content hard will induce players to rise to the occasion. We find the opposite. " -- Ghostcrawler
    "The bit about hardcore players not always caring about the long term interests of the game is spot on." -- Ghostcrawler
    "Do you want a game with no casuals so about 500 players?"

  2. #2522
    Quote Originally Posted by Cooper View Post
    I know this is pointless, but:

    http://www.hollywoodreporter.com/new...-online-902975



    http://deadline.com/2016/06/warcraft...ce-1201770307/



    Those sources are actual Hollywood trade mags reporting $450-$500 million for WarCraft to break even, and where this very website got its information when it itself posted that the movie would need $500 million to break even.

    What you quoted was a guy who had no industry sources just making up what he believed to be true.
    I think the problem many people are having is that their break even point seems incorrect. From a business stand point looking purely at the numbers their "break even" point should be 260 M. Which is what it cost them to produce and market the movie. Anything above that is profit technically. Doubling your initial investment is good business practice and does mean that the movie was clearly profitable. It also means that it is worth making a new movie if it hits double the budget. However, the other problem is the fact that people on here continue to loop in the marketing costs as part of the 2.5 multiplier. That seems off. Simply, because you should not need to make double your marketing budget to hit that 2.5 multiplier which many believe is there to cover marketing costs as well. However, even if you wanted to add the 2.5/2 multiplyer would be like this e.g. (160 M (x2/2.5) + 100 M )=420 M/500 M.

    Now, remember the 2/2.5 multiplier is not there to determine their "break even" point. It is there to measure the movie's profit margins. With it meaning the higher the more likely to produce another one.

  3. #2523
    People still are very invested in weather or not the movie did well at least. When the dust settles I bet both sides of the discussion earn the same thing. Absolutely nothing.

  4. #2524
    Quote Originally Posted by Nekoyou View Post
    I think the problem many people are having is that their break even point seems incorrect. From a business stand point looking purely at the numbers their "break even" point should be 260 M. Which is what it cost them to produce and market the movie. Anything above that is profit technically. Doubling your initial investment is good business practice and does mean that the movie was clearly profitable. It also means that it is worth making a new movie if it hits double the budget. However, the other problem is the fact that people on here continue to loop in the marketing costs as part of the 2.5 multiplier. That seems off. Simply, because you should not need to make double your marketing budget to hit that 2.5 multiplier which many believe is there to cover marketing costs as well. However, even if you wanted to add the 2.5/2 multiplyer would be like this e.g. (160 M (x2/2.5) + 100 M )=420 M/500 M.

    Now, remember the 2/2.5 multiplier is not there to determine their "break even" point. It is there to measure the movie's profit margins. With it meaning the higher the more likely to produce another one.
    You are confused. The 2/2.5x multiplier is there because the studio doesn't get all the box office. And that reasoning applies to the $100M for marketing just as it does to the production cost.

    This has been explained to you again and again, is there a reason you are resistant to clue here?
    "There is a pervasive myth that making content hard will induce players to rise to the occasion. We find the opposite. " -- Ghostcrawler
    "The bit about hardcore players not always caring about the long term interests of the game is spot on." -- Ghostcrawler
    "Do you want a game with no casuals so about 500 players?"

  5. #2525
    Quote Originally Posted by Osmeric View Post
    You are confused. The 2/2.5x multiplier is there because the studio doesn't get all the box office. And that reasoning applies to the $100M for marketing just as it does to the production cost.

    This has been explained to you again and again, is there a reason you are resistant to clue here?
    No you are WRONG:

    The FIXED formula for a Hollywood production to make money is very CLEAR.

    Production Cost X 2.5 = Point of Profits. THE 2.5 FACTOR covers ALL extra (marketing, distribution, theater profits) besides the initial production costs.

    For a 40 million dollars movie = 100 million box office.

    For a 100 million dollars movie = 250 million box office.

    For WARCRAFT: Production Costs 160 million = 400 million box office.

    That point (422 million was already reached as of June 24th for China and July 3rd rest ... with the movie still running in all countries ...

    ----------------------------------------- To the haters one question --------------------------

    WHY oh WHY would Warcraft be MORE costly then the STANDARD profit ratio of 2.5 (including all marketing, distribution and theater profits ) ??

    Simple answer , because you have NO arguments (except for the fact you want to HATE it).


    I have an argument though that the 2.5 factor could be even far less in Warcraft ... since the DISTRIBUTOR and THEATER owner in China .... is the company that .... owns the movie itself... and so the typical Hollywood rule of thumb factor 2.5 is LESS for the movie in China...

    Numurous articles have been published on this typical Chinese movie model btw...

    End conclusion:

    Since June 24th movie sites have been ACK's the fact the most successful MOVIE adaption of a game is making money.

    http://www.flickeringmyth.com/2016/0...ion-worldwide/

    (amongst other sources).

    Quote: "However a fantastic campaign outside of the US has pushed Warcraft over the $400 million mark to $412 million. If you go by the industry rule-of-thumb (that a movie needs to do 2.5x its budget in order to turn a profit), Warcraft is now making money. Expect to hear news of a sequel soon."
    [/I]

    That's all folks. All the rest is history and "whishful thinking". The formula is CLEAR and the conclusion can't be more straight forward as it stands.
    Last edited by BenBos; 2016-07-08 at 11:15 AM.

  6. #2526
    Quote Originally Posted by BenBos View Post
    No you are WRONG:
    Your argument there ignores the details specific to this case: that overseas box office is worth less (to the studio) than domestic box office, and that Warcraft appears to have spent more than a typical movie on marketing. The disproportionate take in China drives up the multiplier.

    I would trust the industry reporters, who have access to this data, over your fan-driven stridency.
    "There is a pervasive myth that making content hard will induce players to rise to the occasion. We find the opposite. " -- Ghostcrawler
    "The bit about hardcore players not always caring about the long term interests of the game is spot on." -- Ghostcrawler
    "Do you want a game with no casuals so about 500 players?"

  7. #2527
    Quote Originally Posted by BenBos View Post
    THE 2.5 FACTOR covers ALL extra (marketing, distribution, theater profits) besides the initial production costs.
    NOPE. Look at calculations in that thread:

    A movie with $160M budget and $135M marketing cost $400M to the studio.
    The box office was $528M, which, with DVD/TV licenses added, brought just $497M to the studio. ($220M from the box office (41%), $142 from DVDs, $42 from TV)
    The movie's profit was just 97M.
    Last edited by Tackhisis; 2016-07-08 at 11:26 AM.

  8. #2528
    Quote Originally Posted by Osmeric View Post
    Your argument there ignores the details specific to this case: that overseas box office is worth less (to the studio) than domestic box office, and that Warcraft appears to have spent more than a typical movie on marketing. The disproportionate take in China drives up the multiplier.

    I would trust the industry reporters, who have access to this data, over your fan-driven stridency.
    http://www.flickeringmyth.com/2016/0...ion-worldwide/

    These ARE "industry reporters" and actually they posted the moment the total REVENUE figures were confirmed AFTER June 20...

    Not some other reporters who jumped in with articles because of the low earnings after the first US weekend... at the June 13 point ...

    The JOKE of your remark is that LEGENDARY is since 8 months ... OWNED by the Chinese WANG Group, so your remark doesn't make sense. And yep that same group that now owns LEGENDARY is ALSO the main distributor in China including most theaters even.

    So the money is there, the 2.5 Hollywood factor (including ALL extra costs), AND the ownership of LEGENDARY is even explained.

    ------

    ROCK SOLID Conclusion.

    The most successful movie (in $$$$$) ever based on a game is making profits.

    As the reporters concluded after June 24... http://www.flickeringmyth.com/2016/0...ion-worldwide/

    Warcraft's production costs = 160 million. The extra factor of 2.5 needs to be applied just like ALL other Hollywood productions.

    Simple (but in the case of Warcraft the OWNER of the movie also owns the distribution in China).

    Edit: the Warcraft movie is now being prolonged in the Benelux, Germany France etc (up to its 7th week in these last countries).
    Last edited by BenBos; 2016-07-08 at 11:35 AM.

  9. #2529
    Quote Originally Posted by BenBos View Post
    http://www.flickeringmyth.com/2016/0...ion-worldwide/

    These ARE "industry reporters" and actually they posted the moment the total REVENUE figures were confirmed AFTER June 20...

    Not some other reporters who jumped in with articles because of the low earnings after the first US weekend... at the June 13 point ...

    ...
    BenBos, both 2x from production + marketing and 2.5x from just production are rules of thumb. They are heuristics saying what usually happens from limited data.

    The first rule is *better* (more accurate) than the second, because it uses more data. You use the second, less accurate rule of thumb when you have no idea what the figure for marketing is.

    Stop your page-long posts belaboring the same nonsense that it's 2.5x production and that it's gospel and everything else can go screw itself.

    - - - Updated - - -

    To put it perfectly clearly, that 2.5x production rule of thumb *does not contradict* 2x from production + marketing. It just *estimates* marketing as 0.25 production. For the Warcraft movie, this was not the case, marketing costs were higher than 0.25 production.
    Last edited by rda; 2016-07-08 at 12:00 PM.

  10. #2530
    Quote Originally Posted by rda View Post
    To put it perfectly clearly, that 2.5x production rule of thumb *does not contradict* 2x from production + marketing. It just *estimates* marketing as 0.25 production. For the Warcraft movie, this was not the case, marketing costs were higher than 0.25 production.
    You know that you owned the Warcraft haters when you see this line: when being confronted with what the MOVIE INDUSTRY uses as a formula to see if a movie made money: Prod costs X 2.5 = Point of profit, ....

    These guys come out under their rocks and make unproven statements like " but the Warcraft marketing costs were higher"... LOL

    No proof, not even a bookkeeping point apart from the fact that...

    THE formula above is the reference point used by the industry AND

    The OWNER of Legendary is ALSO the owner of the distribution chain in China AND most of the theaters in China (which certainly will make that 2.5 fixed point cost FAR less than a normal Hollywood productions where the film maker has to keep costs for distribution AND deduct theater owner profits ...

    So the "haters" can't give ANY argument that would counter the 2.5 factor used in the Hollywood industry watchers, unless to say "marketing was higher" without ANY bookkeeping references and ANY decent well document hard $$$ signs.

    It shows you guys are simply loving your hate against Warcraft with absolutely no proof at all.


    it is SOOOOOOOOO pathetic that you even want to disdain simple fixed formulas of Hollywood return on investements costs because of what .... Hate ?
    Last edited by BenBos; 2016-07-08 at 12:34 PM.

  11. #2531
    Quote Originally Posted by BenBos View Post
    SNIP..

    THE formula above is the reference point used by the industry AND
    SNIP...
    Actually no it's not. The current used reference point is 373% and has been used since about 2012 with all the increase in costs to movie production as well asd A&P and distribution.

    You may not want to believe it but that doesn't matter. Your budget x2.5 isn't even close to the real cost. You'd be smarter to go by budget + marketing x2 for a closer value to break even point. You want to talk ROI here it is.

    That comes from this:
    https://storyality.wordpress.com/201...on-investment/

    Your formula doesn't take A&P or distribution enough into account with only budget and a 2.5 multiplier. Budget alone does't work especially for warcraft and just how much A&P was spent. Sorry but you are once again way off base in the hopes of making warcraft seem better than it actually is. So far the movie didn't make enough to get a DC and that hinged on what Jones said about it and how we would get it.

    Not taking into warped Hollywood accounting, warcraft has not made a profit as you seem to want and thats before we take into account China and how their numbers were very likely manipulated.

    http://chinafilminsider.com/china-bo...come-scrutiny/

    Look up flood-stricken Liuzhou in Guangxi Province. These people were not going to the theater.

    Last edited by quras; 2016-07-08 at 02:22 PM.

  12. #2532
    Quote Originally Posted by BenBos View Post
    THE formula above is the reference point used by the industry
    Why do you think so? (Since you only seem to understand short sentences.)

    - - - Updated - - -

    One more illustration of what the computations are, in addition to the one from quras above and several more up the thread:

    http://io9.gizmodo.com/5747305/how-m...-be-profitable

    Sum total: 2x (production + marketing) is pretty close for the average case (and 2.5x production is certainly far less accurate because it tries to predict one of the most variable factors = marketing costs).

  13. #2533
    Pandaren Monk OreoLover's Avatar
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    Some #'s for y'all to play with in your discussions.


    http://www.boxofficemojo.com/yearly/...yr=2016&p=.htm

    Numbers with 373%, from above post (and others):

    Keep in mind - smaller budgets still have high P&A cost (much higher relatively), so production budget-based #'s do not hold as much accuracy there

    X-Men: Apocalypse [$178m x 3.73 = 663.9m (527.7m listed)] -136.2m (-77% of budget)
    Kung Fu Panda 3 [$140m ... 522.2m (518.9m listed)] -3.3m (-2%)
    Warcraft [$160m ... 596.8m (422.3m listed)] -174.5m (-109%)
    Monster Hunt [$50m ... 185.6m (385.3m listed)] +199.7m (+399%)
    The Angry Birds Movie [$73m ... 272.3m (337.5m listed)] +65.2m (+89%)
    The Conjuring 2 [$40m ... 149.2m (276.5m listed)] +127.3m (+318%)
    .....[The Conjuring = $20m ... 74.6m (318m listed)] +243.4m (+1217%) Greenlit
    Alice Through the Looking Glass [$170m ... 634.1m (261.4m listed)] -372.7m (-219%)
    .....[Alice in Wonderland = $200m ... 746m (1,025.5m listed)] +279.5m (+140%) Greenlit
    Now You See Me 2 [$85m ... 317.1m (216.8m listed)] -100.3m (-118%)
    .....[Now You See Me = $75m ... 279.8m (351.7m listed)] +71.9m (+96%) Greenlit
    London Has Fallen [$60m ... 223.8m (195.7m listed)] -28.1 (-47%)
    TMNT: Out of the Shadows [$135m ... 503.5m (194.1m listed)] -309.4m (-229%)
    .....[TMNT 2014 = $125m ... 466.3m (493.3m listed)] +27m (+22%) Greenlit

    ...skipping down to some Universal releases:

    The Huntsman: Winter's War [$115m ... 429m (164.6 listed)] -264.4m (-230%)
    "The movie is still showing in theaters around the world but it is fast approaching the end of its run. At the time of writing, the studio had made approximately $146.5 million. But, as studios only get around half of this take, cackling rivals think the fantasy adventure needs to make another $178.5 million to break even during its theatrical run." (http://moviepilot.com/p/the-huntsman...rs-war/3907455 - tells about The Huntsman production issues, history, etc.)
    .....[Snow White & The Huntsman = $170m ... 634.1m (396.6m listed)] -237.5m (-140%) Greenlit

    Ride Along 2 [$40m ... 149.2m (124.2m listed)] -25m (-63%)
    .....[Ride Along = $25m ... 93.3m (154.5m listed)] +61.2m (+245%) Greenlit

    The Secret Life of Pets [$75m ... 279.8m (30.9m listed -- domestic opening today, that's only UK, HK, Israel, Norway, Taiwan, Vietnam)]

    The Purge: Election Year [$10m ... 37.3m (43.8m listed; Probably 65m+, based on bigger opening than 2nd/previous Purge film, which hit 72m, and original hitting 64.5m) +27.7m (+277%) (Estimates)
    Last edited by OreoLover; 2016-07-08 at 03:17 PM.
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  14. #2534
    Sooooo...

    "Snow White and the Huntsman" had a production budget of 170M, but made 400M at box office. According to these retarded calculations it should have been a terrible disaster BUT they made a prequel or sequel or whatever the fuck that is, with 115M production budget that only got like 160M in box office. So you would think that the executives there were retarded when they expected the sequel to make like 400M to have just a small profit...

    The fact is that NO ONE really know how much money they actually spend on marketing and it's all assumptions. Each producer has its own ideas, it's not like "there's this rule, dude, that we need to put 100M into marketing so we only make a profit after half a billion at BO"

    We just need to wait and see what they will do next and if they announce a second Warcraft, with the US flop and all that, then for sure all this calculations are completely retarded. If not, then they might fucked it up. Until that, all these rules and thumbs are just pure shit.

    And another thing, I never seen a rich person that makes a lot of money but doesn't complain how fucked up is the market and all that crap. "Yeah, I made half a billion dollars, but really I just broke even, look, I'm starving, cause I put all that money in marketing. Now excuse me, I'm going to my huge home with 147 rooms, to relax a little"...

    It's totally unrealistic for a new movie, based on a game that peaked like 8 years ago, to expect half a billion dollars in box office, even if it's called Warcraft, those producers are not some retards making their first movie. I'm pretty sure they didn't spend 100M on marketing, because, really, where's that marketing? Some terrible trailers is all that I remember from that fantastic and expensive market...

  15. #2535
    Quote Originally Posted by Mosotti View Post
    I'm pretty sure they didn't spend 100M on marketing, because, really, where's that marketing? Some terrible trailers is all that I remember from that fantastic and expensive market...
    Go and look up the cost of television adverts. In the UK they were running a LOT of them. That chews up an advertising budget real fast.

    Pretty much all big budget films these days have advertising budgets at that sort of level. Hell, it isn't unknown for films to spend more on advertising than they spent on the film itself.
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  16. #2536
    Quote Originally Posted by Huehuecoyotl View Post
    Go and look up the cost of television adverts. In the UK they were running a LOT of them. That chews up an advertising budget real fast.

    Pretty much all big budget films these days have advertising budgets at that sort of level. Hell, it isn't unknown for films to spend more on advertising than they spent on the film itself.
    I'd like to add that we don't know how heavily the film was marketed in China or how much they spent on it there. I mentioned a few pages back that it's entirely possible Legendary knew ahead of time the film was going to tank in the US so they may have shifted funds which may have previously been earmarked for US marketing towards the Chinese audience.

    Regardless, for a film with a $160M production budget I really don't think it's too far-fetched to believe roughly $100M would be spent on P&A.

  17. #2537
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    Promotion in China was mostly done thru sponsoring contracts, Wanda and the Chinese Film association, so it didn't cost Legendary that much there.
    They most likely spend most on the western markets, in the case of the US probably more than they got in return in hindsight.

    100Million is fairly normal for films. Angry birds had the same:
    http://www.cartoonbrew.com/feature-f...et-110665.html

  18. #2538
    Quote Originally Posted by rda View Post
    BenBos, both 2x from production + marketing and 2.5x from just production are rules of thumb. They are heuristics saying what usually happens from limited data.

    The first rule is *better* (more accurate) than the second, because it uses more data. You use the second, less accurate rule of thumb when you have no idea what the figure for marketing is.

    Stop your page-long posts belaboring the same nonsense that it's 2.5x production and that it's gospel and everything else can go screw itself.

    - - - Updated - - -

    To put it perfectly clearly, that 2.5x production rule of thumb *does not contradict* 2x from production + marketing. It just *estimates* marketing as 0.25 production. For the Warcraft movie, this was not the case, marketing costs were higher than 0.25 production.
    Even if the marketing costs were higher that doesn't change that marketing costs are a straight expense and should not be used in the calculations of profit margins. It could be either minus from the total money that was made or it can be added to 2.5 the cost of production. Doubling the money you spent on marketing really should not factor into your profit margin calculations. Covering costs for marketing can and should.

    I'm not confused I just don't understand why everyone keeps trying to say what they spent on marketing should also be included when calculating their profit margins from productions. Marketing costs are not suppose to hit the multiplier at all. It can be inclusive of the 2.5 indicator that is being used to determine success but it should not be additive to the multiplier. It is a straight expense. Once it is covered that's it.

    You don't have to make double the profit that you spent on advertisement. You just need to cover the cost for it so you can do it again. Why would you care if you made double the marketing cost? As long as you were able to cover it.

  19. #2539
    Quote Originally Posted by Nekoyou View Post
    Even if the marketing costs were higher that doesn't change that marketing costs are a straight expense and should not be used in the calculations of profit margins. It could be either minus from the total money that was made or it can be added to 2.5 the cost of production. Doubling the money you spent on marketing really should not factor into your profit margin calculations. Covering costs for marketing can and should.

    I'm not confused I just don't understand why everyone keeps trying to say what they spent on marketing should also be included when calculating their profit margins from productions. Marketing costs are not suppose to hit the multiplier at all. It can be inclusive of the 2.5 indicator that is being used to determine success but it should not be additive to the multiplier. It is a straight expense. Once it is covered that's it.

    You don't have to make double the profit that you spent on advertisement. You just need to cover the cost for it so you can do it again. Why would you care if you made double the marketing cost? As long as you were able to cover it.
    What profit margins? You think the number 2 is for a profit margin that someone would deem "acceptable"? It's not that, it reflects the fact that those who make a movie (and advertise it) get only part of money from ticket sales. Roughly half.

    Nobody is talking about how big of a profit the movie made and whether or not it is big enough, the thread is talking merely whether or not the movie broke even.

  20. #2540
    Quote Originally Posted by Yggdrasil View Post
    People still are very invested in weather or not the movie did well at least. When the dust settles I bet both sides of the discussion earn the same thing. Absolutely nothing.
    The people invested in the movie doing well get another movie. The people who want to hate on it get the satisfaction of being right.
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