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Film & Home Video Industry Slide 2 Historically... Vertically Integrated Oligopoly Develop and evolve with new technology Intellectual Property (Patent/Copyright) Format/Standardization Synergism MPAA (trade/ratings) Slide 3 Slide 4 Structure Production (markets?) Distribution Exhibition Majors: WB Disney Paramount Universal Sony/MGM 20 th Century Fox Slide 5 Production Top 6=88.5% Produced, 82-85% of market WB= 18%, $11.7B Paramount=16%, $1.2B Sony Pictures=11%, $7.3B Universal=11% 20 th Century Fox=11% WD Motion Pictures=11% Majors' Divisions=11% Slide 6 Slide 7 Slide 8 Vertical Integration Slide 9 Indies Lionsgate ($1.58B) Dreamworks (ADA, $16B) Lucasfilm LTD ($1.5B in 2005) Organic maybe? Music/A&R? Slide 10 Products Placed Transformers Placed Greatest Movie Ever Sold Slide 11 Runaway Production Creative=plot/setting/preference Economic=reduced costs Hollywood production -50% since 1996 90% of US runaways in Canada Slide 12 Turning a Profit? PG ratings/Family movies Remakes, Sequels Reduce risk, make safe films that will sell Repeat proven formulas MPAA, no average costs, $106.6M in 2007 1 hit=5 more productions (profit margin) 6150% return / $6M budget; $369M return Avatar, $1.85B Slide 13 Reproduction Slide 14 Online 77.8 percent of the total U.S. Internet audience viewed online video. The average online video viewer watched 327 minutes of video, or nearly 5.5 hours. 99.7 million viewers watched 5.9 billion videos on YouTube.com (59.1 videos per viewer). 47.4 million viewers watched 349 million videos on MySpace.com (7.4 videos per viewer). Hulu accounted for 2.6 percent of videos viewed, but 4.9 percent of all minutes spent watching online video. Slide 15 Majors=82-85%