I mean, they’d get more money for a theatrical/streaming release.
The argument and implied reason for scrapping the film is that they wouldn’t. Look at “Shazam! Fury of the Gods” on a budget of ~$125 million the box office return was ~$135 million. Add in the theater split, any level of marketing, etc and the film lost money. For a streaming release you need to ensure you’ll retain, ideally gain new subscribers.
The number crunchers ran the numbers and said it wasn’t worth it. Although the funny thing is, with all the news about it, they could probably release it now and it would do fine.
That said I don’t agree with what happened, it just seems ridiculous.
They already have the enormous cost of production sunk though. I understand not paying for marketing, but projected profit goes from “negative” to “massively negative” if they don’t at least license it out to streaming.
An anecdote: AT&T was having a fire sale on the base iPhone 16 Plus, like so cheap that it must have been a loss. It didn’t make any sense to me, but an employee speculated that, since it was their worst selling model of the lineup, they were clearing the inventory and writing it off as a loss to compensate for some other transactions.
This is classic sunk cost fallacy logic. It’s because they had the enormous cost of production sunk, they resisted the fallacy and sinking more money into it since the returns were not favorable.
But this doesn’t apply. This product has like zero per unit cost, and (per reports) it’s all but finished.
Hence the bare minimum cost for getting it out the door is basically nothing. With the state they have, they could use a tiny amount of money to make much, much more, no matter how poorly the movie performs.
The only reasonable explanation is some external benefit to sinking it instead of releasing, like a tax write off.
I’m curious how financial incentives even worked here.
I mean, they’d get more money for a theatrical/streaming release. And it’s not like recent DC cinema has a stellar reputation to “preserve.”
It takes one screwed up corporate system to reject revenue.
It isn’t revenue until its revenue, but at any time before that it can be losses for tax purposes.
The argument and implied reason for scrapping the film is that they wouldn’t. Look at “Shazam! Fury of the Gods” on a budget of ~$125 million the box office return was ~$135 million. Add in the theater split, any level of marketing, etc and the film lost money. For a streaming release you need to ensure you’ll retain, ideally gain new subscribers.
The number crunchers ran the numbers and said it wasn’t worth it. Although the funny thing is, with all the news about it, they could probably release it now and it would do fine.
That said I don’t agree with what happened, it just seems ridiculous.
They already have the enormous cost of production sunk though. I understand not paying for marketing, but projected profit goes from “negative” to “massively negative” if they don’t at least license it out to streaming.
It’s probably something tax related, but still.
It’s literally all tax-related. Every single thing, not just Hollywood and movies.
If something doesn’t make sense to us, it probably makes sense to the people who actually do the math on a regular basis.
Yeah.
An anecdote: AT&T was having a fire sale on the base iPhone 16 Plus, like so cheap that it must have been a loss. It didn’t make any sense to me, but an employee speculated that, since it was their worst selling model of the lineup, they were clearing the inventory and writing it off as a loss to compensate for some other transactions.
This is classic sunk cost fallacy logic. It’s because they had the enormous cost of production sunk, they resisted the fallacy and sinking more money into it since the returns were not favorable.
But this doesn’t apply. This product has like zero per unit cost, and (per reports) it’s all but finished.
Hence the bare minimum cost for getting it out the door is basically nothing. With the state they have, they could use a tiny amount of money to make much, much more, no matter how poorly the movie performs.
The only reasonable explanation is some external benefit to sinking it instead of releasing, like a tax write off.