[nabsltd]

Originally Posted by DMcCunney

Nope. I meant exactly what I said. Most new product from movie studios, record companies, and book publishers tanks. It fails to find an audience, and doesn't recover what it cost to produce it.

Got any accurate citations for this information?

You likely don't, because at least for movie studios, you are 100% wrong. They make money off nearly every picture they release...only a very few huge budget pictures that absolutely tank (i.e., $100 million budget and $5 million worldwide gross) actually lose the studio money, and even then it's not as bad as it looks, because the studio has already sold the rights to HBO, etc., and they don't count that towards "profit", because it isn't theater tickets.

Part of the reason this happens is that the studio that releases a movie often puts up far less than 50% of the total budget. The rest of the budget comes from venture capitalists, or is completely fictional...created by Hollywood accounting.

And you can add comic books and live theater to that list.

Creative accounting certainly exists, but that's a separate issue

Nope, it's often the only issue. Comic book "failures" are a great example of this. In many cases, the people who worked on the title were on staff and would have been paid regardless of whether that particular title was created or not. But, their time (likely inflated, like lawyers with minimum billing units) still gets charged against that title, and thus it "lost money".

It's just like a publisher that assigns fixed overhead (either $X/copy, or a percentage) to a book instead of actually calculating what the specific cost for that title was. It turns out that true overhead really is shared among all work requests (i.e., individual titles at a publisher, individual websites at a web design company, etc.), and the more work you have, the less overhead per item. So, if a publisher releases 20% more books in a year than previously, they should adjust the overhead down on all the books that year, but instead they go with the contract as written, which favors them.

There are literally hundreds of tricks that all "publishers" (movie, music, books, etc.) use to make sure that they almost never pay anything more than the advance to the people that actually created the content. It's so widespread that most publishers don't even consider it unethical...it's just the way it has been for nearly 100 years.