Monday, July 14, 2008

So ... How Much Do These Movies Cost?

"These movies" being Kung Fu Panda, Wall-E, and Horton Hears a Who*.

The first thing to know: What a studio says a movie costs and what it really costs might be two different things. I know first-hand that companies sometimes put costs incurred by one film onto the production number of another film. (Hard to believe that fine, ethical business executives would do such a thing, but there it is).

Second thing to know: When you look at the alleged costs for this or that film and compare them, there's no way of knowing if you're comparing the same thing. As The Wise Old Production Exec told me moments ago:

Some pictures include advertising and distribution costs in their announced budgets, others don't. Some include costs of A-list talent in the up-front budget, others might not if most of those costs are percentages of gross on the back end. And the costs of studio overhead vary widely ...

By the Wise Old Studio Exec's reckoning, Blue Sky's overhead would be quite a bit less than the overhead for Pixar/Disney. As the WOSE said:

The last studio I worked for, I estimated $120,000 per employee, per year. So figure it out: if the studio is carrying 300 employees, that's $36 million per year. And if a picture takes two years to produce, that's $72 million, assuming the full staff is working on that one picture for all two years.

I don't know exact numbers, but Pixar has a larger staff than Blue Sky Animation.

From the outside, you can never know with total certainty what a picture actually costs. A decade ago, a management person at the late, lamented Warner Bros. Feature Animation studio informed me that Quest For Camelot ran up a tab that was a whole lot higher than the one Warners admitted to. Execs officially maintained the feature cost $80 million; my source said it was more like $130 million, but much was charged off to "studio overhead."

Then we come to the three box office champions cited above. DreamWorks Animation honcho Jeffrey Katzenberg has said DreamWorks's features cost $150 million for new models, $120-$130 million for sequels because a lot of fixed costs that carry over have already been paid for. But Mr. Katzenberg is likely ballparking, since KFP is officially listed at the $130 million mark.

Wall-E was a film in production for a long time, which might account for its $180 million price tag. As the WOSE informed me:

Eighty percent of a picture's costs are labor, and the longer a film is in work, the more expensive it will be. If you've got lots of people on payroll for years, the picture ends up higher priced ...

Studios have different way to attack costs. One obviously is the size of a crew, another is length of production time. (We won't count "just make it up.") Half a century ago, Sleeping Beauty was the most expensive animated feature Walt Disney Productions had yet done, costing around $4 million. Two years later, the studio produced 101 Dalmations for half that price, using less than half the artists.

You see? Feature budgets can be brought down.

* For the original back-and-forth on studio costs, go a couple of notches down the blog.


Anonymous said...

people are so darn expensive. if they could only figure out how to make the world go round without them. oh, wait. it already does. but no one wants to tell us yet.

Anonymous said...

This is what I don't understand. In the mid-90's, salaries were higher. People were pulling in huge paychecks, signing bonuses, other perks, as the studios competed for talent. It was a seller's market.

Today's salaries have fallen. For many, they are much lower than what they were. Yet the price tags for features are considerably higher. If 80% of the movie's cost is labor, why weren't the animated films of the 90's drastically more expensive than today's?

Anonymous said...

True, sir, production costs can be brought down, but Sleeping Beauty and 101 Dalmations are hardly on the same level of artistry. When I bought and viewed the latest DVD release of Dalmations, I was shocked by how tepid the production was. Sure, the Xerox outlines were revolutionary for the time, and the overall design was clean, fresh and modern...but it comes off today as There are recycled movements all over the place, sloppy drawing...a real disappointment (and the movie was a favorite of mine when I was a kid). Sleeping Beauty, on the other hand, while it did have story problems, is a visual feast, lush and vibrant, truly a masterpiece. I can see why Walt was so disappointed in Dalmations, although it made money while Beauty did not. Beauty represented Disney artistry at its best. Dalmations marked the end of an era...

Anonymous said...

"101 Dalmatians" had some of the best character design AND animation Disney has ever produced. Roger and Cruela's animatiopn is fantastic in it's own right. Roger's design is particularly appealing.

The plot might not move as smoothly though. I agree the movie's rythm is clunky at best, but the artistry is there. You just don't know how to appreciate it, sir!


Tim said...

I think the lesson learned by the Sleeping Beauty/101 Dalmatians comparison is that story sells tickets, not lavish production design. (If you have both, all the better!)
But back to the salary/budget discussion. Salaries in the late 90s were high because of the crazy animation wars when Jeffrey started Dreamworks, and everyone was duking it out for talent - just to keep them from going to the other guy's studio. My salary tripled in six months. Studios were willing to pay more because the last three films from Disney had making $250-$300mil domestic B.O., not to mention toy licensing! (B&B, Aladdin, Lion King)
But the rush to get films into theaters resulted in less than stellar stories and market saturation. Grosses suffered ("Treasure Planet" cost a reported $165mil and grossed less). Reality set in. Studios closed, 2-D animation was declared dead, and salaries lowered into the reasonable range. Paid downtime and signing bonuses became stuff of legend as animators were laid off between films (just like in the 70s & 80s).
Studios simply cannot spend more than they take in. They're just sometimes slow to learn that they should be spending on talent and not the plethora of development execs with business degrees trying to tell stories.
It's nothing personal, it's just business.
(someone should fill us in on the cost/profit ratio of Lilo & Stitch. From what I heard that was a well managed production that turned a quick profit.)

Tim said...

2nd paragraph should have said "had made", not "had making".
Sorry for the verb tense gaff.
I really do speak English.

Alex Dudley said...

I'm gonna get my animation done at Sunwoo.
Shipping animation to GOOD Korean studios is so much cheaper.

I guess studios don't do it often is because of some union law against it.

Anonymous said...


Is that before or after you graduate from school?

Anonymous said...

"I guess studios don't do it often is because of some union law against it."

Wow...what universe do you live in?

Anonymous said...

"Shipping animation to GOOD Korean studios is so much cheaper."

Ummm.... yeah ... there's a good chance that Korean studio is re-outsourcing the work to a cheaper studio in Manila or Calcutta.

It's a shell game. The costs seem less up front , but many, many productions have ended up spending more money on a "fixes budget" for
off-shored work than they would have if they just kept the work at home to begin with.

Anonymous said...

No. Actually the way it works is the Korean/Japanese or whatever studio agrees to do it for a set price that includes 'x' amount of footage. They also negotiate a seperate price for 'artistic' retakes. If the retakes are the result of sloppy or outsourced work they eat it - not the American company. If the retakes are the results of the American company making mistakes or changing their minds then the American company eats it.
What usually works in the overseas company's favor is if there is a deadline that stops multiple retakes from occuring, but that ends up hurting them in the long run because then the American company could stop using them if they do nothing but sloppy work - regardless of whether it's outsourced or not.
Usually the way most Korean/Japanese companies work is they have an A crew that they use for the first episode of a new show or tests and then B and C crews that rotate on the additional episodes (and sometimes a D crew - pray you never see a D crew show). You might get lucky and get the A crew every now and then, but don't count on it. They also might outsource to other studios or countries if they get too much work in-house.

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