Question one: The issues raised by media ownership in

Question one: The issues raised
by media ownership in
contemporary media practice.
Learning outcome: You will know how
the ownership of the production,
distribution and exhibition companies
affects the type of films that are being
At the end of this revision notes
you need to be able to answer:
1. How does the ownership in the film
industry effect how films are produced?
2.How does the ownership in the film
industry effect the distribution of film?
2. How does the ownership in the film
industry effect the exhibition of films?
1. How does the ownership in the film industry
effect how films are produced?
• In your exam I would use Warp Films and Working Title as your main
case study as Warp is a British independent studio and Working Title
owned by a conglomerate. If you are having trouble remembering
both just choice one. As Warp is small and independent you might
also have to mention Film 4 as it has co-produced films with them. I
would also mention Warp X which makes smaller budget films, as
they focus on making on digital films. As Warp being smaller
budgets, and Working Title being medium budgets you could also
contrast them with 20th Century Fox which is one of the Major
studios, so it is competently different to Warp as it is owned by a
larger media conglomerate news Corporation. Although it is similar to
Working Title, Working title have their film budget capped. This
means these companies have different film budgets, focus on
different genres and to some extent have different audiences.
Media ownership
• 1. question asks: The issues raised by
media ownership in contemporary media
• What it means:
• How does the ownership of the
production, distribution and exhibition
companies affects the type of films that
are made.
• When we are talking about ownership we are
talking about a monopoly where a few powerful
institutions control pretty much everything you
see here and read. Although there are other
independent companies, these global media
giants referred to as parent companies control
the production companies and the means to
• One of these parent company is called News
Corporations which owns Fox filmed
entertainment, which owns 20th Century Fox,
and the distributor Fox searchlight. News
Corps also own other subsidiary companies
like the Sun and the Times.
There are two types of ways a company can be
structured in its ownership.
One is referred to as vertical ownership-where the companies in
that portfolio supple and depend on each other.
Horizontal: Where companies are owned by the same parent
company but do not rely on each other.
What do you think is the benefit of vertical ownership for a media
company? If they own both the production company-distributor and
the means to exhibit i.e. News Corps own Fox production
company a distributor and also Sky which most of their films are
broadcast, so they are paying themselves money and in charge of
the whole process cutting out the middle man. That’s why News
Corps refers to themselves as vertically integrated media
Vertically Ownership
Different parts of the
organisation are involved in
the same process
Distribution company
Horizontal Integration
Companies do not Parent company
supply or depend NEWS CORPS
on each other in
this model.
Subsidiary company
Subsidiary company
Subsidiary company
Film production and ownership
What is Production
• Production: Is the creation of the film, however it
also means the decisions and processes that go
into making a film. There are different types of
companies involved in the production process:
Both major studios and also production
• A production company is the company that is
responsible for making of a film and also maybe
responsible for raising finance for that film, but
this is not always the case. A production
company maybe a small company, which sells
its idea to a major studio or may co-produce a
film. This is often the case because films are so
expensive to make that.
• Major studios can be involved in both the
production and distribution process.
Watch video following video
Production companies
The production company may be directly responsible for fundraising for the production
or may accomplish this through a parent company, partner.
Production companies are often either owned or under contract with a media
conglomerate, i.e. 20th Century Fox is owned one of the 6 major film studios in
Hollywood and is a subsidiary of Fox Entertainment which is a owned by News
Corporation. Fox Searchlight is also owned by News Corps, and is a major distributor.
These companies are usually self financing as they are owned by larger conglomerate.
In contrast there are also independent film studios which are not part of the big 6 and
are not a subsidiary. British films are often independent and are made by small
production studios which do not have the resources to distribute and market their work.
To secure distribution in cinemas in Britain and abroad, they have to convince
distribution companies - of which the biggest are all controlled by US studios - that
their films are worth showing.
But even when they succeed and the films make money, a lot of the profit goes to the
distributors, with no guarantee that it will be reinvested in British film.
Media Conglomerate: is a media institution that owns large numbers of companies in
various mass media such as television, radio, publishing, movies etc.
Two types of film companies
• Film production companies can be classed into two
categories; Major film studios and Independants.
• Major film studios own both production companies that
make the films and also the distribution companies that
either distribute their own films and also distribute
independent production companies films.
• Independent production companies produce their own
films, but do not have the money to distribute their own
films. They often find it difficult to raise money to produce
the films and will have to seek to involve the majors early
on in production.
Major studios
Major studios
• There are 6 major studios in the world that they are a subsidiary company of
a handful of dominant media companies which own most of media in the
world from TV, Film and even music. The same parent companies who own
the film studios also own the music industry
• News Corporation-owns 20th Century Fox, The Sun, Myspace
• Time Warner: Warner Brothers, IPC magazines
• Disney: Walt Disney Motion pictures, Disney Channel, Pixar
• Bertelsmann: Channel 5
• Viacom-owns Paramount Pictures, Nickolodian, MTV
• Sony-Sony Pictures-Columbia Pictures
• Vivendi-Universal
Music Industry
The same parent companies
own films and music industry
Major labels since 2009 (Big Four)
Sony Music Entertainment parent company sony who also owns Sony
EMI Group
Warner Music Group Parent company Warner Brother who also own
Warner Brother Pictures
Universal Music Group-Parent Company Vivendi and General Electric
Consider that Film the Boat that Rocked is produced by Working Title which
is a British production company, but is co owned by Universal Studios. Not
only does this mean it has a big company behind it to finance more
expensive films but also their distributing power. Guess which record label
produced the soundtrack? Mercury Records and I bet you can guess who
owns them? Universal, so this is how synergy works by promoting your own
products which also means more profit.
Link-Boat That Rocked is made by Working Title which is co owned by
Universal, Universal also Own Mercury Records which made the
The difference between an independent company and a
major studio ?
Independent films are different from film studios because they do not have as much money
to both product, distribute and market films this means they often have to work with other
companies to produce their films. Some institutions need to join with other institutions
which distribute films.
Independent and small studies often have to work with other studios so they
can produce films examples would be Warp films who work with other parts
such as Film 4 on This is England, and also when they created Four Lions
which was co-produced along with Film4, Wild Bunch and Optimum
Releasing, Optimum releasing also distributor the film.
Co-produced is where they work with another company to produce a film,
and they raise and finance the film together.
Copy this link to view the video:
How does ownership effect the
production of a film?
The first stage of production is getting financial backing.
Independent companies like Warp Films and particularly other smaller British
companies, which are not linked to an American conglomerate as a subsidiary
company are used to have to rely on money from the UK film Council and the National
Lottery which funded many British films like the King’s Speech.
The UK film council has recently been closed by the coalition government, and the BFI
(British Film Institute) has taken over this role with the responsibility of film policy, and
also distributing national lottery money to British film makers, which has increased
from 27million to 43million from 2014.
The BFI have a film fund which distributes money to British Film makers
Other avenues for British film makers include if they are lucky a private investor or
through pre-sales i.e. selling shares before a film is made, or through sales of
television rights
Self funding or donations (see Warp Films and the Kickstart Campaign)
BFI what they do
• The BFI have a film fund which supports
emerging film makers (production)
• The BFI also have a Print and Advertising
fund (distribution and marketing) which helps
to widen and support marketing of specialised
• Export fund (Exhibition) The BFI has an film
export fund which help to enhance
opportunities of British films which have been
selected to appear at international film
Major studios can make big budget films
because they are part of a bigger
conclomorate and have more money to
make the big blockbusters. This means that
their films will focus on blockbusters, special
effects and big marketing campaigns. Avatar
for instance cost as much in marketing as it
did in product.ion Further, advertisers, and
tie in deals with companies like Mcdonalds,
and Coca Cola will be more likely to want to
be involved in big budget films because they
have a wider audience and are shown at
more exhibition houses.
This is because independent films are often
low budget and focus particularly in Britain
on genre based films as they do not have
the funds for CGI and 3D and are shot in
digital because it is cheaper than 35mm film.
They also do not have the money to act as
distributor which means they have to rely on
either co-funding or using film festivals to
promote their films. Major studios can get a
lot of private investment because they have
a proven track record.
Film Finance
Production and funding
• The first stage of production is getting financial backing.
• Independent companies like Warp Films and particularly other smaller British
companies, which are not linked to an American conglomerate as a
subsidiary company are used to have to rely on money from the UK film
Council and the National Lottery which funded many British films like the
King’s Speech.
• The UK film council has recently been closed by the coalition government,
and the BFI (British Film Institute) has taken over this role with the
responsibility of film policy, and also distributing national lottery money to
British film makers, which has increased from 27million to 43million from
• The BFI have a film fund which distributes money to British Film makers
• Other avenues for British film makers include if they are lucky a private
investor or through pre-sales i.e. selling shares before a film is made, or
through sales of television rights
• Self funding or donations (see Warp Films and the Kickstart Campaign)
BFI what they do
• The BFI have a film fund which supports
emerging film makers (production)
• The BFI also have a Print and Advertising
fund (distribution and marketing) which helps
to widen and support marketing of specialised
• Export fund (Exhibition) The BFI has an film
export fund which help to enhance
opportunities of British films which have been
selected to appear at international film
2.How does the ownership in the film industry effect
the distribution of film?
• As we have seen so far the bigger
companies also own distributors this
means it is easy for
• Film distribution is everything that happens in between the making of
the film and exhibiting it. A film distributor is a company or
individual responsible for releasing films to the public either at the
cinema or for home viewing (DVD, Video-On-Demand, Download,
Television programs through broadcast syndication etc.).
• Distribution involves all the deals done to get it to the cinema.
• Promotion-what goes in to promoting a film, this includes above and
below the line advertising
• Above the line: is all the promotion which includes costs of trailers,
posters, billboard, website, and other tie in deals with companies like
Mcdonalds and Coca Cola which are mututally beneficial
• Below the line: This includes where stars of the movies do interviews
with magazine and also includes reviews of the films.
By contrast, distribution, the third part of the film supply chain, is often referred to as 'the invisible
art', a process known only to those within the industry, barely written about and almost
imperceptible to everyone else.
Yet arguably, distribution is the most important part of the film industry, where completed films are
brought to life and connected with an audience.
So what is involved in this invisible process? Distribution is about releasing and sustaining films in
the market place. In the practice of Hollywood and other forms of industrial cinema, the phases of
production, distribution and exhibition operate most effectively when 'vertically integrated', where
the three stages are seen as part of the same larger process, under the control of one company. In
the UK, distribution is very much focused on marketing and sustaining a global product in local
In the independent film sector, vertical integration does not operate so commonly. Producers tend
not to have long-term economic links with distributors, who likewise have no formal connections
with exhibitors. Here, as the pig-in-the-middle, distribution is necessarily a collaborative process,
requiring the materials and rights of the producer and the cooperation of the exhibitor to promote
and show the film in the best way possible. In this sector, distribution can be divided into three
stages - licensing, marketing and logistics.
• Around the world most of the world’s
distributors are owned by one of the big
companies who control the industry. This
means they are in charge of promoting
their own films and also the films of smaller
studios like Warp. These means the power
of a films success lies in the hands of a few
companies, and the smaller studios,
particularly in Britain have to rely on
working with one of the big institutions.
• The first stage of distribution is the acquisition of rights to a film.
There are three stages that a distributor might become involved with
a film
• Pre-production: distributor might invest in the early stage and invest
in the production of a film, and have some say over the film.
• Production: Distributor might buy the rights to a film when it has
already been made.
• Third: If the studio is already part of a large conglomerate like News
Corps they will use their own distributor i.e. Twentieth Century Fox.
Most of the Major big 6 studios own both production companies and
distribution companies, but due to the law cannot own cinemas. This
joint ownership of both owning both production studios and
distribution companies means these companies generally dominate
the box office.
• Who is your films production company and distributor? Who has
invested in it?
Five major distributors dominate the UK film industry including United
International Pictures, Warner Brothers, Buena vista, Twenthieth
Century Fox and Sony. Most of these distributors are linked to
Hollywood Production companies who make the films. They also deal
with exhibitors who are no longer owned as used to be the case
owned by the same Hollywood companies. These distributors for
reasons of profit and bigger audiences priorities Hollywood films, and
blockbusters are usually blanket release. This means smaller British
films are never always shown all over Britain because they are
competing against these big films which are treated more like an
How many different
distributors would you
expect to be involved
with this film?
There are 21 in total if you include both cinema and
home video distributors.
14 of these companies are owned by Universal (or part
owned as UIP is joint owned with Paramount) – a great
example of vertical integration!
Universal Pictures (2003) (USA) (theatrical)
Argentina Video Home (2004) (Argentina) (DVD)
Argentina Video Home (2004) (Argentina) (VHS)
Filmes Lusomundo (2003) (Portugal) (theatrical)
Mars Distribution (2003) (France) (theatrical)
RTL Entertainment (2006) (Netherlands) (TV) (first national
airing) (RTL5)
Studio Canal (2003) (France) (theatrical)
United International Pictures (UIP) (2003) (Argentina)
United International Pictures (UIP) (2003) (Switzerland)
United International Pictures (UIP) (2003) (Germany)
United International Pictures (UIP) (2003) (Spain) (theatrical)
United International Pictures (UIP) (2003) (UK) (theatrical)
United International Pictures (UIP) (2003) (Italy) (theatrical)
United International Pictures (UIP) (2003) (Netherlands)
United International Pictures (UIP) (2003) (Singapore)
United International Pictures (2004) (Japan) (theatrical)
Universal Home Video (2004) (Brazil) (DVD)
Universal Home Video (2004) (Brazil) (VHS)
Universal Pictures (Spain) (2004) (Spain) (DVD)
Universal Pictures Benelux (2004) (Netherlands) (DVD)
Universal Pictures Canada (2004) (Canada) (DVD) (as
Universal Studios Canada)
Film distribution how it works
Someone has an idea for a movie.
They create an outline and use it to promote interest in the idea.
A studio or independent investor decides to purchase rights to the film.
People are brought together to make the film (screenwriter, producer, director, cast, crew).
The film is completed and sent to the studio.
The studio makes a licensing agreement with a distribution company.
The distribution company determines how many copies (prints) of the film to make.
The distribution company shows the movie (screening) to prospective buyers representing the
The buyers negotiate with the distribution company on which movies they wish to lease and the
terms of the lease agreement.
The prints are sent to the theaters a few days before the opening day.
The theater shows the movie for a specified number of weeks (engagement).
You buy a ticket and watch the movie.
• Distributors do a deal with an exhibitor i.e
cinema chain for how long the film should
be shown i.e. a licence agreement for how
long the film should be shown. Distributors
then get a profit from ticket sales.
Distributors are also responsible for
marketing the films so that people go to the
cinema to watch the film, which benefits
both the cinema and the distributor.
Film licensing
licensing is the process by which a distributor acquires the legal right to exploit a film. In distribution, licensing itself can take
place on two levels.
International distribution ensures that films find their way to the 90+ market 'territories' around the world. The major US studios
generally have their own distribution offices in all the major territories. By contrast, independent producers have to sell their
films to different distributors in each territory. Independent production companies are usually small concerns, sometimes set
up for one film and often lacking the necessary knowledge or contacts of each of the territories around the world. Instead of
doing this themselves, they might choose to hire a specialist sales agent, whose function is to understand the value of a film in
many different markets. The sales agent will then set up stall at the film markets that take place throughout the year.
Then there is 'local' distribution, which involves the distributor acquiring the licence to release and exploit the film in a
particular country. The distributor will usually pay the producer a minimum guarantee for the licence. This fee will vary
depending on the status and perceived commercial potential of the film, and on the range of rights that the distributor chooses
to exploit. A distributor will usually be offered theatrical rights, for showing the film in cinemas; video rights, for video and DVD
exploitation; and TV rights, if the distributor is able to sell the film to a broadcaster.
In addition to paying a fee to secure the film, the licence will stipulate that the distributor will also pay royalties to the producer,
taken from the profits that the film generates. A local distributor will conventionally share profits equally with the producer for
the theatrical leg, pay back higher royalties for broadcast rights, and lower for video/DVD.
Once the licence has been agreed, it is then the distributor's job to launch the film. In the UK, feature films are released initially
theatrically (in cinemas). A theatrical opening is seen as the most effective way to create interest in a new film. The big screen
is still the optimum setting for a film for both audiences and the filmmakers.
Some months following the theatrical release, a film will be packaged and released on DVD and VHS video, then on various
forms of pay television and eventually, two years after opening in cinemas, on free-to-air television. The value of the film built
up by its theatrical release reaps dividends throughout its release cycle, influencing the audiences and commercial value it
subsequently commands.At every stage, the successful distributor must have an in-depth knowledge of the marketplace which cinemas, video outlets and broadcasters can best draw an audience for its films - and of the variable marketing costs
involved in releasing a film in that territory. The trick is to weigh up the two factors, to invest as much as is needed in promoting
the film to draw out the maximum returns.
Film distribution problems for
The problems for smaller studios like Warp is not only do they have
to rely on a distributor to promote their film, but also because ever
film shown in the cinema is printed on a separate film reel, smaller
companies cannot afford to have as many prints. Major studios can
afford this outlay, which means often cinema views have to wait until
their local cinema has this type of film available.
• So at the level of distribution smaller studios cannot afford to
compete with bigger films, and have to look at other ways to
distribute their films. They also cannot afford big above the line
promotion i.e teaser trailers, which are usually reserved for the
blockbusters films. Smaller studios if they get a big star to agree to a
pay cut to star in their film0 i.e Catherine Zeta-Jones saved an
independent British film Death Defying Acts from being scrapped by
agreeing to take a pay cut to star in it. The star, who can command
fees of up to $12.5 million, agreed to a lower salary after it was
revealed the project was struggling. This means independants could
then use below the line advertise to promote for film.
Distributors have to position films to reach their target
audience. If released in a slow period, or when their is
intense competition their film maybe a failure.
Films rarely break even through cinema releases alone, but
they rely on the success of the cinema to increase DVD and
15-24 year olds the most frequent cinema going age, so lots
of films are targeted at them i.e. Robert Paterson films.
Distributors love films aimed at this target audience but also
films that can also bring wider audiences in too. Avatar, Alice
Wonderland etc.
A publicity campaign that misidentifies an audience will
jeopardise the audience. Consider the last time you went to
the cinema if it was to see Avatar notice how may other 3d
films were advertised. You were their target audience,
remember the glasses you had and if you kept them you
would get a discount? This is clever marketing to get you
back again, is it a coincidence that all the 3d films came out
at the same time, no it was to keep you coming back for
more.. Most blockbusters are released certain times of
year to coincide with school holidays.
The marketing of a film release revolves around two key questions: 'When?' and 'How?'
In the UK, new films are released theatrically on Fridays. The schedule for forthcoming releases is
coordinated and published by the Film Distributors Association. A distributor will assess this
schedule to identify a Friday release date where there are only a few films scheduled for release.
Finding a 'light' week will ensure that there will be both screen space and adequate review column
inches in the press allocated to any potential release. A further consideration for scheduling a
release is the seasonality of the film. For example, it is widely assumed within the industry that
specialised films have the greatest potential to reach audiences during the academic year. Finally,
the distributor will try to position the film distinctively and avoid a release date occupied by other
films with similar traits (story, subject, country of origin). In recent years in the UK, these two
aspects of release planning have become increasingly difficult, as the release schedule has
regularly featured over 10 new releases in a week.
After setting a release date, the distributor works towards the theatrical release, investing in the
materials and the marketing campaign to support it.
The costs of theatrical distribution, met by local distributors, are often referred to as 'P&A', or Prints
and Advertising. P&A are the nuts and bolts of marketing and distributing films into cinemas, the
tools used by the distributor to create a public for its film. P&A also represent the bulk of the
distributor's investment, after paying the initial fee for rights, and can range from less than £1,000 to
over £1 million for the release of a film in the UK.
Advertising and marketing
The key elements of Prints and Advertising (P&A) that a distributor must consider at this stage are:
The quantity and production of release prints and trailers:
Specialised films will often be released with fewer than 10 prints into key independent cinemas,
with these prints subsequently 'toured' over a 6-month period to all parts of the UK. On the other
hand, commercial mainstream films will often open on over 200 prints, simultaneously screening in
all major UK towns and cities.
Press materials, clips reels, images, press previews, screener tapes:
For the majority of releases, favourable press response is a key factor in developing the profile and
desirability of a film. Distributors consider both the quality and breadth of coverage, and this is often
inscribed into the nature and scale of a press campaign.
The design and printing of posters and other promotional artwork:
The cinema poster - in the UK this means the standard 30" x 40" 'quad' format - is still the
cornerstone of theatrical release campaigns. Numerous recent examples indicate that the poster
design is highly effective in 'packaging' the key attributes of a film for potential audiences.
Distributors will also consider other poster campaigns, ranging from Underground advertising to
Advertising campaign locations, ad size and frequency:
Advertising in magazines, national and local newspapers works in tandem with press editorial
coverage to raise awareness of a release. Press advertising campaign for specialised films will
judiciously select publications and spaces close to relevant editorial. For mainstream films, scale
and high visibility is the key. The cost of print advertising in the UK is comparatively high, and is
seen as making distribution in the UK a riskier business than in most other countries. In order to
extend the reach of advertising and develop more effective communication with audiences at low
cost, distributors are looking increasingly to 'viral marketing' - different forms of electronic word-ofmouth via the internet, email and mobile phones.
Press campaign / contracting a PR agency:
Many independent distributors in particular do not have press departments, and will consequently
hire a press agency to run a pre-release campaign. This is especially the case if the distributor
brings over key talent for press interviews to support the release.
Arranging visit by talent from the film:
The use of talent - usually the director and/or lead actors - wins significant editorial coverage to
support a release. The volume of coverage can far outweigh the cost of talent visits.
Other preview screenings:
A distributor will consider the use of advance public screenings to create word-of-mouth and
advance 'buzz' around a film
Marketing Campaign above the line advertising
Marketing is part of the distribution process as when distributors do deals with
exhibitors, distributors are responsible for the promotion of the film, so that
people will go to the cinema to see the film. involves the promotions of the films
and can take the following forms:
Posters: A tease poster released before the main poster to generate information.
This is expensive marketing because of printing and time costs, but is an
effective way of generating pre-release interest. Film posters include key
elements, i.e. generic codes of the film i.e mise-en scene- guns for actions, a well
known star or director will have their name on it to promote the film.
Trailer: Higher budget films will also have a teaser trailer, watch teaser trailers for
Avatar and the main trailer what do you notice. James Cameron and all his films
are promoted, why do this?
Trailers in the UK have to get BBFC certificate rating just like the films, this
means most distributors would want a 12a so they can get to a wider audience
as possible remember who goes to the cinema the most.
Genre of the film has to be apparent in the film. Key scenes, dialogue but not to
ruin the surprise, if the film is star driven i.e Robert Patterson this needs to be
mentioned in the trailer.
All films need to have a USP, what is your films poster, trailer saying?
Breaking dawn scenes cut
The British Board of Film Classification advised producers to edit the
“graphic sight of Edward thrusting while he lies on top of Bella” to avoid
the film being given a 15 certificate.
“This film was originally shown to the BBFC in an unfinished version,” a
statement on the BBFC website says. “The BBFC advised the company
that the film was likely to receive a ’15′ classification but that the
requested ’12A’ certificate could be achieved by making changes to a sex
scene between the Edward and Bella characters.
“In particular the BBFC suggested that [the] more graphic sight of Edward
thrusting while he lies on top of Bella, and while her legs are wrapped
around his torso, be removed.
“When the finished version of the film was submitted these changes had
been made, with the scene having been reduced in length and with less
focus on full body shots. As a result, the film was classified ’12A’.”
We’re not sure what the Motion Picture Association of America had to
say, but we assume they too wanted this scene cut down so it could
receive a PG-13 rating.
The first Breaking Dawn – Part 1 trailer includes a shot of the sex scene
(at 1:17): read:
The distributor will enter into an agreement with the cinema to screen the film on certain 'play-dates'. It is the
responsibility of the distributor to arrange the transportation of the film to the cinema, as part of its wider
coordination of print use across the UK. Logistics represents the phase of distribution at its most basic - supplying
and circulating copies of the film to theatres, of tapes and DVDs to shops and video rental stores, and managing the
effectiveness of the supply. The showing of films in cinemas is a time-pressured activity. Cinemas spend their
money publicising film play-dates and times in local papers or through published programmes. There's an
imperative for the distributor to deliver the film on time.
For UK theatrical exhibition, the distributor typically handles 35mm film prints. Each print can cost around £1,000 or twice that if subtitled - so a degree of care is required of everyone involved in handling the print. In the UK, prints
are generally broken down for ease of handling into smaller reels, each lasting around 18-20 mins when run through
a projector at 24 frames per second. So a feature print, in its physical form, will usually be 5 or 6 reels, stored and
supplied in a single hard case, weighing in at 20-25kgs. Prints are hired by the exhibitor for the duration of their
play-dates, and therefore each print is made for repeat use. It's easy to see from this that, during the course of even
a short theatrical release period, any single print needs to be moved many times from the main print warehouse,
onto a delivery van, to the cinema, onto an assembly bench, through the projector and then back through the
process and onto the next cinema.
35mm theatrical prints invariably suffer cumulative damage as they pass through different projectors, and the hands
of various projectionists. There are also overheads incurred by the distributor for the storage of prints at the UK's
central print warehouse in West London. For these reasons, each theatrical print has a finite lifespan. Distributor will
invest in sufficient prints to provide optimum coverage through the first period of theatrical release, usually lasting up
to 6 months. From this point on, many of the now used release prints will be destroyed, leaving only a small number
to be used for second-run and repertory theatrical bookings through the remainder of the film's licenced period.
 Exhibition is how the films are shown and where they are shown i.e.
through cinema, DVD, online etc
• For instances the traditional films are exhibited and cinemas through
a 35mm film. These largely benefit for big studios and Hollywood
studios because of the cost of 35mm print.
• Smaller independent studios often use Film festival to exhibit and
promote their film, or the digital screen network
This is the process of showing a film to an audience, mainly referring to a cinema
environment, but with the advent of new digital projection equipment and DVD
players, screenings in schools, colleges, art centres and outdoor venues are future
possibilities. The Role of the Exhibitor Film bookings After viewing the film from the
distributors for release, the exhibitor/film booker will discuss the release pattern and
the financial deal to rent a film from the UK distributor. This is based on projected
ticket sales for a film, that is, box-office returns. The cinema programming is
scheduled by a film booker. Some cinema chains, multiplexes and multi-screen
cinemas operate from a central point or a Head Office with a booking department. The
smaller cinemas have an in-house film booker responsible for programming specific
films or film seasons. The film booker working for each cinema chain is the person
responsible for the films which play in each cinema. The brief for a film booker is to
find films which will attract an audience for their cinema and reap a good financial
return from the box office. The exhibitor pays the rental fee back to the distributor
which is determined by the price of a cinema ticket within the cinema. It is up to the
exhibitor to work hand in glove with the distributor in marketing the film to the widest
possible audience. Most mainstream films are booked from three to six months in
advance, and some major US blockbusters can be booked up to a year in advance of
their UK release date. By July most film bookers will have scheduled the slate of films
to be released at Christmas. 86
The cinema building The exhibitor will have posters and advertisements as well as the date and
times of the screenings of current and future films outside their cinema for the interest of the
general public. This is an attempt to draw the attention of the public to their cinema. A passer-by
who may not have the opportunity to read a newspaper or check the internet will perhaps be
encouraged by this publicity to go and see one of the films. The foyer is the first area in the
cinema that the audience experiences. Distributors vie for space in the foyer to display posters,
standees and other film publicity material and merchandising. It is the cinema manager's job to
make sure that the publicity is current and relevant to films showing at their cinema. The
exhibitor/cinema is the 'shop front' where the film industry 'sells' films to the audience. The foyers
are committed to publicising the films with posters, standees and concession promotions which
all advertise the film. Once you are seated in the auditorium, before the main feature, 'teaser'
trailers and trailers are shown advertising films that are soon to be released all aimed at
attracting a future audience. Local Marketing The exhibitor's role is important in promoting a film
at a local level. The distributor and exhibitor work together to maximise the audience for a film.
The cinema manager draws up a marketing plan which includes press advertising, local
promotions and competitions. Conversely, cinema managers receive marketing information
which keeps them abreast of the distributor's efforts to promote a film. This document tells the
cinema managers what is happening and ensures that a film is, at any one time, efficiently
promoted at a local level by that cinema manager
How they make money
Money taken at the box office alone is not enough to give the exhibitor/cinema a profit after paying
the rental fee, especially if the film is a failure. The popcorn, ice- cream, sweets and hotdogs you
can buy at the cinema are known as concessions. The concession stands in both multiplexes and
independent cinemas provide an additional source of income to the exhibitor. Local press The most
common form of marketing that the exhibitor will undertake is to buy space in local newspapers to
advertise the films they are screening. This space can be in free newspapers and trade papers or
ones which are paid for. These advertisements will often appear on the day of the films' changeover
which is usually a Friday, as many chains do between 30-60% of their business during the
weekend period. Research shows that advertisements in local newspapers are one of the key ways
in which people find out about films screening at their local cinema though since 1997 this has been
overturned by the increasing availability of access to the internet. Promotions and competitions
These are part of the overall marketing plan the exhibitor has drawn up for the distributor to
maximise awareness of the film. They can take the form of competitions in local newspapers or in
the cinema foyer e.g. 'spot the difference' games, quizzes on stars, with give-away cinema tickets,
or merchandise from the distributors as prizes. This also ensures editorial coverage of the film in
the local press: it is a good two-way relationship – the film is covered and the newspaper has
something which is entertaining to fill its pages. Trailers The trailer often plays in the cinema around
six weeks before the release of a film and continues to play until the film opens in the cinema. The
trailer aims to raise audience awareness of a film by fixing the film title in their minds. It gives an
overall impression of the film to its potential audience making sure that the audience is aware of the
stars – particularly where their names will help to sell the film. A trailer should create the desire to
see the film when it eventually opens
In this country the majority of the cinema going public are aged between 16 and 23 years old.
Statistics show that they are the group which have the time and money to go to the cinema. It is this
age group therefore that need to be targeted by filmmakers, distributors and exhibitors to
encourage them in, and then back to, the cinema. However, the location of new multiplex cinemas
has also led to the development of a more family-centered audience – who are attracted to the
nearby shopping or leisure facilities as well as to the cinema itself. Baz Luhrmann's 1997 film
William Shakespeare's Romeo and Juliet was a massive blockbuster hit, but did not have a huge
publicity campaign. The film did not receive any Oscars and the reviews in the US and the UK were
lukewarm. The exhibitors say that it is one of those very rare films which continue to run because
the same people return to see it again and again and it is by word of mouth that they return. It will
be one of the most enduring and profitable hits of 1997 with the core audience seemingly being
under thirty, whilst the older cinema going public think that it is ‘the best Shakespearean film ever
made.’ As the cinema's image has changed and become more up-market with high-grossing films,
the price of cinema seats has reflected this change and risen dramatically. It can cost £16 or £17 to
see a film in central London and yet cinema audiences continue to rise. Can you think of any
reasons why this is so? If the reasons are not purely economic, then the image of cinema going
must surely play a part. The multiplex complexes are popular despite often involving a good deal of
travelling beyond local public transport. We must now consider whether the cinema-goer is as
interested in the facilities surrounding the cinema in which the film is seen as in the actual film on
the screen.
Background to the Cinema
Exhibition in the UK Since 1995
The number of cinema screens in the UK and the number of admissions have both
increased by more than 60%. Screens: 1995 2,005 - Admissions/per Screen:
108.0m/53,865 Screens: 2001 3,258 - Admissions/per Screen: 176.0m/54,020
Screens 2007 3596 - ? Most of the screens in the UK are owned by one of the major
cinema chains. Vue, UCI, Odeon or UGC. Independent cinemas accounted for only
938 screens (29% of the total number) in 2002, a decrease of 7.5% since 1997. The
cinema sector is still in some turmoil at present with two major chains having been sold
recently (Warner Village Cinemas was bought by Vue cinemas in 2003) and up to
three others available for sale. (May 13, 2003) Vue International Cinemas, the
developer and operator of state-of-the- art-cinemas, today announced its acquisition of
the Warner Village Cinema chain in the UK. The purchase of 36 Warner Village sites
nationwide boosts its number of multiplex cinemas from 6 to 42 overall with a total of
384 UK screens The advent of digital cinema may change this landscape somewhat,
but no-one is yet making the necessary investment in digital projection equipment and
distribution systems. The UK Film Council are supporting independent cinemas'
acquisition of digital technology. The world's first digital cinema network will be
established in the UK over the next 18 months.
Exhibitor/Distributor Deals
They will, therefore, try to restrict the number of prints available to maximise their income from each site. How There
There are three different types of deal that an exhibitor might enter into with a distributor: i) The House Nut - The
House Nut is a figure calculated to represent the costs of running the cinema. In a house nut deal, the rental paid to
the distributor will be either 25% of the gross Box Office or 90% of the Box Office minus the house nut (what it cost
to run the cinema) – whichever is greater. This is the deal structure generally favoured by the majors. ii) Scale Under this arrangement, the amount payable to the distributor rises according to the amount that Box Office
exceeds a pre-set break figure, which is often capped at 50%. Exhibitors will often offer guaranteed minimum
payments and the parties may agree special terms to cover overages if the film performs particularly well. This
structure is often used by independent distributors. iii) Percentage - Finally, the parties might agree a straight
percentage split of the Box Office. This type of deal is becoming increasingly common in the UK, being used for
expected blockbusters. Cinema Revenues – How do exhibitors make money? Ticket sales are only one aspect of a
cinema's revenues. In 2001, ticket sales contributed about 66% of total revenues, with concessions income and prefilm advertising accounting for around 16% each. On average, cinemas generate £1 of concessions income and £1
of advertising revenue for every person who buys a ticket. These figures are averaged across the multiplex chains
and independent cinemas - in practice, the multiplexes tend to make more from sales of popcorn and drinks than
the independents - between them, the top three chains sell some 16 million buckets of popcorn a year. Over the
past twenty years cinema going in the UK has experienced something of a renaissance. Attendances have
increased from just fifty million a year to nearly one hundred and eighty million. Experts are divided about the
reasons why this should have happened. Is it that there are better quality films around that people want to see? Is it
that there are now more comfortable cinemas for people to visit? Up until the mid 1980's cinemas in many countries,
particularly the UK, Italy and Germany had received very little in the way of investment and because of this many
cinemas deteriorated. Whereas once a trip to the cinema meant a visit to somewhere that was more comfortable
than home, the state of British cinemas in the early 1980's meant that people were visiting run down, uncomfortable
places. In the 1970's large, single screen cinemas had been cheaply converted into three or four screen cinemas.
This would often mean that the audience in one screen could hear what was happening in the film on the screen
next door. This detracted from the enjoyment of the film and consequently caused a drop in audience attendance at
the cinema
Rise of the multiplex
• With audience attendance levels declining box-office takings waned. The
Hollywood distributors found themselves particularly affected by this. As a
result of this decline, the major US studios realised that they would have to
revitalise and invest in the European exhibition industry (it’s worth 60% of
the overall international market) if their own production industry was to
survive. Exhibitors also begun to realise that as well as selling films to
audiences, they also have to sell their own cinemas as the best place to go
and see these films. It was the major American studios, such as Universal,
Warner Bros. and Paramount who were the main investors in the
development of multiplexes around the world. Through detailed research
they came to the conclusion that many countries did not have enough
screens to cater for the audience that they were trying to develop. In the mid
1980's they also realised that the state of many cinemas in countries such
as the UK was so bad that people would not want to visit them. Thus,
through the building of multiplexes, companies hoped to encourage many
more cinema goers into their cinemas and stimulate interest and
excitement.. The US distributors determined that cinemas should be located
close to large shopping centres, restaurants and other leisure pursuits.47
Digital cinema
Towards the end of 2005, the UK distribution and exhibition sectors were
starting to move towards digital distribution and exhibition. For exhibitors,
digital projection, especially when married to the increasing use digital
formats in production, can now replicate - if not surpass - the image quality of
conventional 35mm cinema presentation. And, of course, digital sound
systems have been used in cinemas for some time.
In distribution terms, the advantages of digital technology are even clearer,
though perhaps longer term. Digital technology is seen to offer a more cost
effective and logistics-light alternative to the tried and trusted, but unwieldy
model of 35mm print distribution described above. It will, eventually, be
cheaper and much less stressful to send films as computer files to cinemas
across the UK, than to transport 20-25kg tins of film in the back of a van.
Digital technology also made it possible for smaller companies to compete
because it was a lot cheaper to produce.
Digital cinema
Since mid-1999 public screenings of digitally projected, mainstream feature films have
been taking place in selected cinemas worldwide. Millions of paying customers have
attended digital cinema screenings and it is now generally accepted that conventional
35mm film projection will soon be replaced by Digital Cinema technologies. The
equipment is still expensive but the picture quality is astonishing and, some have
claimed that in several respects it surpasses conventional film. The number of digital
cinemas in the UK is growing rapidly and it is estimated that by the end of 2011, the
majority of the UK’s 3,000+ screens will have digital capability.
It is now accepted that the DCI approved digital cinema format will replace
conventional 35mm film projection as the principal format used in professional film
distribution and exhibition. Most commercial cinemas and many independents are now
in the process of making the transition to digital, installing digital projection in all their
The key advantages of digital cinema (‘d-cinema’ ) for local cinemas are:
The distribution of films to cinemas is potentially much cheaper, quicker and easier. Individual
cinemas will potentially be able to get the latest, high earning films at the same time as West End
cinemas. It will be more economically viable to distribute minority interest films and to provide
subtitled or dubbed versions
The picture and sound quality will always be as good as it was at the première. No scratches,
jumps, dirt or flicker to disturb the viewing experience
Local filmmakers, students and school pupils will be able to project their films to local audiences,
quickly and inexpensively.
Localised advertising tailored to the particular audience will be possible
Additional smaller auditoria become viable and provide greater choice for local audiences. A local
digital cinema – a digital mini-plex – may have one or two large auditoria (150 to 250 seats) and
three or four very small ones (30 to 50 seats). There are now many examples of this type of cinema
in the UK and the rest of Europe.
Non-film uses, especially the screening of live cultural events, may become important additional
revenue streams. In some locations local businesses and education organisations will use the
facilities. A number of cinemas in the UK, Europe and North America are now offering live and
recorded cultural and sporting events in cinemas and reporting revenues 200% to 400% over
regular film screenings. In France 300 venues, often converted town halls, offer sports and cultural
events under the banner ‘Vidéo Transmission Haute Resolution’.
For the provision of regular screenings, the technology is relatively easy to use and will impact on
many aspects of the cinema operation and economics. For example there are now a small number
of commercial digital cinemas in the UK where front of house and technical staffing levels have
been reduced to a minimum.
Digital cinema benefit to small
• Digital cinema technologies are transforming the
way films are made, edited, distributed and
projected. There is a rapidly growing number of
filmmakers who work with camera and computer
equipment purchased from high street stores to
produce very low budget films – sometimes with
professional actors. This means that digital
technology from cameras to cinema is enabling
more people access to creating films.
Digital Screen Network
• Before its closure the UK Film Council, now
taken over by the BFI and the Arts Council
England created the Digital Screen
Network – a £12 million investment to
equip 240 screens in 210 cinemas across
the UK with digital projection technology to
give UK audiences much greater choice.
Digital Screen Network
The average Hollywood blockbuster opens on 300-plus screens across the
UK; most independent films, restored classics, documentaries and foreign
language films still struggle to reach over ten per cent of those screens.
Digital screening cuts the cost of releasing films (a digital copy costs around
one tenth of a 35mm print).
Cinemas in the network have already screened non-mainstream films
including Control, This is England, Good Night and Good Luck and the
Oscar®-winning The Lives of Others, as well as classics like Meet me in St
Loius, The Wizard of Oz and Casablanca.
The (DSN) Digital Screen network is beneficial to independent and British
production companies because they show non-mainstream films and they
also do not rely on having to use a distributor or 35mm film.
Film festival
Film festivals are another way to exhibit films, this benefits both the independent
companies and smaller studios who use these to promote their films. For instance if
they do well at festivals then the film receives below the line free advertising through
TV and media channels that cover the event. Major studios also show their work this
included Avatar which was shown at a Dubai Film Festival.
Warp films film Tyrannosaur, has won the Golden Hitchcock Award this year. Again
this helps to promote the film.
Examples include Sundance Festival and Cannes Film festival.
Exhibition summary
Along with the impact of digital technology from digital cinemas, digital
cameras makes it more easy for independent production companies to
produce and distribute their films via the (DSN). This is because the (DSN)
aimed at help non-mainstream films get shown, rather than competing
against big budget films and major studios who promoted their films and
could show it in more cinemas.
Further as Love Film has shown they are using digital technology to stream
films through the internet, even SKY has a Go app where through a Wifi
connection you can watch films, and Xbox live you can rent films. In the
future it seems more likely people will be able to watch films at home than go
to the cinema. This creates a problems for the major companies as they will
lose some of their distribution and exhibition power unless they adapt. It also
opens up the possibility for little studios to promote their films online. This
has already happened with the film Zeitgeist an alternative documentary
movie which was released online. However, it is also important to remember
with a lot of these online web 2,0 websites they are owned by media
conglomerates i.e Google who owns Youtube, News Corp who owns Sky.
This means they have still the means to exhibit and promote their films
without cinemas and the big budgets to continue to make mainstream
blockbuster films, and use their own.
The importance of cross media convergence and
synergy in production, distribution and marketing.
This section will link with PowerPoint 2 case studies, which shows these in practice but a definition
Convergence describes two phenomena: First, technologies coming together, for example, a mobile
phone you can use as a still and moving image camera, download and watch moving images on,
use as an MP3 player and recorder and access the internet with. Second, media industries are
diversifying so they produce and distribute across several media—for example, a newspaper with an
online version and audio podcasts or the coming together of videogames with films.
We no longer live in a media world where television, videogames, films, newspapers, radio,
magazines and music exist separately. For this reason it is essential that you study the impact of
convergence on the film industry — the focus here is on the contemporary.
Synergy: In media revenue, synergy is the promotion and sale of a product throughout the various
subsidiaries of a media conglomerate, e.g. films, soundtracks, or video games. I.e. Working Title
owned by Universal made the Boat that Rocked, the Soundtrack was owned by Mercury record
label which is also owned by Universal