Posts Tagged ‘economics’

Disney's "Alice in Wonderland" has made the majority of its profits off 3D ticket sales, but did the technology justify the higher ticket price?

There is a big debate going on about the influx of 3D movies that has been going on the past few years, and continues going on strong. Some claim that the technology has already reduced itself to a gimmick, while others believe wholeheartedly that it is the future of cinema. Who is right? Can anyone be wrong? In order to come to any kind of conclusion, we first have to look at the facts.

Much of this topic comes down to economics. An article in Variety by Pamela McClintock examines this angle in-depth, and answers a lot of questions regarding why the film industry is so keen on this latest and greatest technology. To put it simply, there is a lot of money in it. The unfathomable success of James Cameron’s Avatar has driven a number of studios into a frenzy, spurring them to make some 2D movies into 3D in order to cash in on the popularity. The upcoming Clash of the Titans (April 2^nd) is one such film that was made into 3D at the 11^th hour. For some, these half-baked conversions are one of the major points of contention. The claim is that such last-minute conversions are adding to the thinking that 3D technology is nothing more than a money-grabbing gimmick. This may be true, but consider this: producing a film in 3D from the get-go adds $20 million to its budget almost automatically, while converting a film into 3D during post-production only adds $10 million to the budget (some studios even claim $5 million). The issue over post-production conversions, then, may not entirely be an issue about getting more money from audiences, but also about saving money. So, it is not completely about the first goal of business (making profit) but also the third (reducing cost). But what about the second goal (increasing revenue)? Read the rest of this entry »