The world of Hollywood financing is complex and arcane, and from a distance, it seems like it makes almost no sense. Someone decided to make Jupiter Ascending, after all, as well as Blackhat and Mortdecai, and none of those things seem like decisions that people who were interested in making money or a quality piece of consumer entertainment would have pursued. But the way movies are financed–while definitely not based in things that those of us who, like, want to watch good movies for fun and enlightenment can understand–is actually rather simple: ultimately, it comes down to math.
Adi Shankar knows the math of producing movies. Most recently, he’s been in the news for the “bootleg” short films he’s made based on intellectual property to which he has no claim, intended to earn no money. (That’s a series that grew by two in recent weeks, after both Power/Rangers and James Bond: In The Service Of Nothing were released on the Internet.) But his mainstream feature film credits as a producer include movies like A Walk Among The Tombstones, Lone Survivor, The Grey, Broken City–and, of course, Dredd, the much-beloved, seldom-seen adaptation of the British dystopian comic book franchise.
Shankar has spent a lot of time fielding questions about a potential Dredd sequel (we’ve asked him about it ourselves), and with all eyes on him after his attention-grabbing recent bootlegs, Shankar decided to finally set the record straight–in a five-minute video that demystifies the world of film finance in ways that go well beyond Dredd, explaining how independent films–a group that includes not only Dredd but also movies like Looper, Silver Linings Playbook, Olympus Has Fallen, and other films that looked and performed like Hollywood studio blockbuster productions–are greenlighted.
Essentially, Shankar describes a simple math equation. The money comes when distribution contracts in different countries and territories are put together. So you add up the value of the domestic distribution contract, the distribution contracts in big-dollar markets like the U.K., China, Germany, etc., and the money from government subsidies/incentives/tax rebates/etc for shooting in a particular location, and if those numbers combine for something larger than the budget of the movie, then that movie will get made; if the numbers are smaller than the budget, then nobody is going to make the movie no matter how badly a core group of fans want to see it.
The distribution contracts get their value from a few things–movie stars, which distributors know audiences like, or big-name directors whose movies consistently perform well, or characters or brands with whom audiences are familiar and thus are inclined to see. The value of the distribution contracts for a movie based on a popular 80’s cartoon that stars Robert Downey Jr. and Jennifer Lawrence, directed by Ron Howard, would be through the roof, in other words, while an original idea starring that guy from the Allstate commercials and directed by someone who had made a few well-received shorts had probably better be pretty cheap.
Shankar goes into the details of film financing in ways that will make even a neophyte to the world feel like an expert–and he does, ultimately, address what would need to happen for there to be a Dredd 2 (spoiler: it involves The Rock)–which ain’t bad for a guy wearing Crow makeup at his desk for no reason.