Record Summer Box Office Screws Studios

by Paul William Tenny

How so, you ask? The studios (via the Association of Motion Picture and Television Producers - AMPTP) are currently holding contract negotiations with industries most unhappy labor union, the Writers Guild of America. The WGA feels like it hasn't made any significant gains during the previous negotiations three years ago, and are dead-set on not letting the studios screw them over with digital-medial residuals the same way they've been cornholed with DVD residuals.

Hollywood studios have been telling Wall street that they're making money hand-over-fist, only to turn around and claim to the guilds' face that they are going bankrupt by record failures at the box office and skyrocketing costs. Or so WGA has been saying since the negotiations official began in August, I believe it was. Even though the guild was certain the claim was empty, they now have proof to back it up, and they got it without having to force open the books with a lawsuit or the threat of a strike (they can save that one for later.)

This summer's box office set a new all-time record in a way that makes clear how incredibly good business has been this year for the studios who are claiming at the bargaining table to be starving to death.

Now that the summer season -- which began May 4, the first Friday in May -- has officially ended with the close of the Labor Day weekend, Hollywood is basking in the warmth of a new summer boxoffice record.

For the 18 weeks of summer, the North American box office totaled $4.33 billion, as tracked by The Hollywood Reporter. To be sure, the tracking services report slightly different totals. According to Media By Numbers, the summer hit the $4.18 billion mark. Nielsen EDI reports a summer box office haul of $4.16 billion. The Hollywood Reporter's numbers show a slightly higher total because in addition to charting sales for all studio and indie films in theatrical release, it also includes ticket revenue from such other sources as ethnic film venues and museums.

This, from Yahoo! News, confirms everything the writers have been saying for a number of years now. It is common practice for the studios to juggle the math so as to purposefully make every single film show a loss on paper, to avoid paying anything beyond up-front fees. Several lawsuits over the years have sought to force the studios to open their accounting to outside eyes.

This will figure prominently in the continuing negotiations with writers this year and into 2008, when both the Directors Guild of America and the Screen Actors Guild begin their own respective negotiations. With studios making record profits on tent-pole franchise films, the writers seem well within their right to strike if studios continue to lie about finances in an effort to cheat everyone but themselves out of their fare share.


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