Film Fund-amentals: Don’t Worry, Be Happy!

Ticket sales are booming, and Hollywood is the economic wunderkind of the current recession.

If the Variety report is to be believed, that was the direction that Dan Glickman, CEO and chair of the Motion Picture Association of America, was headed toward while presenting at the ShoWest trade show in Las Vegas recently. Obviously, the dry dessert air has done wonders for his vision. It’s rose-colored glasses all the way.

OK, Glickman is right that there has been a 9 percent increase in ticket sales during 2008 (well, actually the global figure is 7 percent). And the cost of tickets has only risen 4.4 percent from the previous year. Somehow these extremely modest figures are being referred to as a powerful growth engine (it should be noted that this is in the Variety report dated 4/1/09 — Glickman’s actual address has not yet been posted online, and the date of the report is a nice ironic touch).

Glickman’s annual report at ShoWest is normally a combination of morale boost to the choir (theater owners) and a positive spin to investors. So it is no surprise that his ShoWest spiel is a passionate plea that the future is brighter than the burning desert sun. Certainly that sounds a heck of a lot better than what he said last month when he was talking to Film Journal International about “tough economic times” and “uncharted territory” and “the dark cloud over everything.” Gee, that previous talk sounds like a bummer. And nobody goes to ShoWest to hear a bummer.

It also appears that nobody goes to Vegas to hear real figures. While Glickman was busy celebrating the 9 percent boom (a figure largely based upon the huge success of a few movies), he was also side-stepping the MPAA’s new decision not to do their traditional annual detailed statistical figures on the actual cost of production and marketing for movies (you know, the kind of hard figures a business needs in order to determine if it is actually making money or simply spitting in the wind). After years of compiling, analyzing and releasing these figures, the MPAA discovered that the complex structure of producing a film is just too difficult to deal with (which is odd, because the modern system hasn’t really changed over the past ten years — wonder why it took them this long to realize that they didn’t know what they were doing).

Figures be damned. Who needs data when Dan Glickman can simply sing a few bars of “Don’t Worry, Be Happy,” then rub his tummy like a jolly fat Buddha and announce that the world is flat and all is well. I guess that’s the idea.

Traditionally, the MPAA releases the Theatrical Market Statistics, a rare and vital guide to what is really going on within the smoke-and-mirror haze of financial management in Hollywood production. This report is one of the few guides to go by in analyzing the current state of Hollywood, which would be especially useful during a season of lay-offs and major studio restructuring (the current shift at some studios toward a limited number of big productions is a major form of financial restructuring). It is as close as you can get to real numbers in a business where many of the key players are extremely uncomfortable with reality. It provides the financial grid with which you can determine what, if anything, is actually making money. It is just about the only guide you’ve got in an industry built on slippery dreams.

Which is presumably the real reason why the MPAA suddenly can’t handle the report. What Glickman said in March is closer to the truth than anything he had to say in Vegas. After all, the 9 percent increase in ticket sales is based upon a few mega-hits and the rise in ticket costs. Many other movies are producing only middling results. The vast majority are pretty much tanking.

Attendance (per title) is actually down. Meanwhile, production costs keep going up. Even movies that made over $100 million are actually not doing well, since they cost somewhere in the range of $200 to $250 million to make. The complex deals behind many of these productions (which the MPAA now claims are impossible to track) are primarily done in order to hide losses, not to actually generate revenue. In the process, DVDs and the various TV markets are on their own downward spirals, cutting even further into the already crumbling parameters of the profit line.

So Glickman kind of has a point. In telling the industry that it can’t handle the truth, he pretty much confirmed just how bad it really is. Too bad cutting off the data is not going to change anything. It may calm some nervous theater owners. It will briefly satisfy a few dimwitted producers. At best, Glickman can claim that he did his job as chief cheerleader and social director on the Titanic.

But I am the sort of person who always looks for the positive side. If there are no financial reports, then people like me can pretty much make up any “facts” we want to, and the industry can’t really challenge it. After all, where are the figures?

— Dennis Toth