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PWOKristy
Bree
May 29 2008, 11:23pm
Post #1 of 31
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Budget questions
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Hello,
Okay, thought I'd ask here. Why are "The Hobbit" and its sequel gonna cost $150 million dollars each, when the 3 "Lord of the Rings" movies only cost alot less ($94 million)? Is it 'cause of like to "normalize" (or compete) it with other big budget movies, examples, like "Harry Potter ($150 million)" and "Narnia ($200 million)"? I'm just curious.
Thank you!
Regards,
Kristy.
I have a Pleo (a robotic, sauropod dinosaur).
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Sunflower
Valinor
May 29 2008, 11:32pm
Post #2 of 31
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I can't say for sure, but I do know that NL saved a lot of money by selling off the distributors rights to a lot of countries. How that works I am not sure, but there are others who are in the know about this stuff. I do know that Warner's is not going to be doing this with The Hobbit films. Warner's is distributing it in the U.S. and MGM in the rest of the world.
I really wish Warner's had continued with the NL policy, as it was a boon to the local film industries of many countries. But oh well...
BTW, Welcome Kristy! Come on in and join the party! It's going to be a great 4 yrs!
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Woodyend
Gondor
May 29 2008, 11:40pm
Post #3 of 31
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You need to compare LOTR movies with other movies from the same time.
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It’s hard to believe but FOTR was released in 2001.
May your beer be laid under an enchantment of surpassing excellence for seven years!
~~~~~~~~Gandalf~~~~~~~
Listen, strange women lying in ponds distributing swords is no basis for a system of government!
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burrahobbit
Rohan
May 29 2008, 11:54pm
Post #4 of 31
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For LotR they only had to make one measley gold ring, but for The Hobbit they need a whole dragon horde! That's $100 million bullion at least  .
Seriously, I think when they made LotR PJ and Weta etc were fairly unknown outsiders. Now as oscar winning stars, they can claim bigger bucks, as can the actors.
View my Hobbit Film Adaptation Discussion
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Elven
Valinor
May 30 2008, 12:07am
Post #5 of 31
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MGM ... raising the finances ...
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for production of the Hobbit though?
http://www.forbes.com/...05/13/ap5005515.html
Hollywood's MGM taps money boss to build film fund
By RYAN NAKASHIMA 05.13.08, 7:20 PM ET
Metro-Goldwyn-Mayer Inc. said Tuesday it has hired industry veteran Bedi Singh as its finance chief and head fundraiser for upcoming films, a further sign it is ramping up efforts to produce its own movies, reports Forbes. The studio, taken private for nearly $5 billion in 2005, aims to establish a fund to co-finance its upcoming films, including "The Hobbit." The first installment of that series is scheduled for release in 2011.
Singh, a former Sony Pictures chief financial officer, will lead financing efforts. "It's no secret that we've been looking for additional film financing for MGM movies," spokesman Jeff Pryor said. "That's going to be a key part of his role." MGM has been trying to turn around its movie production business since its revived United Artists subsidiary, headed by Tom Cruise and Paula Wagner, flubbed on its first production attempt with "Lions for Lambs" last year. The movie cost $35 million to make but has yet to turn a profit. The studio hired former Universal Pictures production vice-chair Mary Parent in March and then quickly announced it had acquired the film rights to Robert Ludlum's book "The Matarese Circle" and Ben Wexler's comedy screenplay "Bobism." Since the 2005 leveraged buyout by private equity firms Providence Equity Partners and Texas Pacific Group, Sony Corp. and Comcast Corp., MGM has generated revenue primarily through distribution of independent fare such as The Weinstein Co.'s "Halloween" last year. It is now aiming to bolster its production lineup, take a greater stake in movie production and reap more of the profits. United Artists already has a $500 million credit line from Merrill Lynch, but MGM is seeking additional financing partners for its movie slate, which includes future "James Bond" and "Pink Panther" sequels.
Were off to Hobbiton finally!
Tolkien was a Capricorn!!
Russell Crowe for Beorn!!
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Empedocles
Rivendell
May 30 2008, 12:38am
Post #6 of 31
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The movies are such sure hits from a financial point of view that I don't think that MGM or Warner are even worried about the budget. Think about it this way, if they contribute $100 million dollars each (a total of $200 = $150 budget + $50 advertising), they'll get that money back in like 2 days, Warner in the US and MGM in the international market. The fact that these movies will cost much more than the original trilogy is due to the fact that they can actually throw money into it without worrying about its return. They know it's going to return, big time.
Please, give us back Glorfindel!!!
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Elven
Valinor
May 30 2008, 12:46am
Post #7 of 31
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Id say they'd be watching this budgeting like hawks ...
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especially after the last fiasco - at least they may have truer figures this time around - and MGM and Warners wont be the only ones watching these figures possibly if the movie goes ahead - all investors and those due shares will be seeing that things are in order ...
Regardless of the earning potential - I think they will still buget and still be raising cash - no like a charity that has no money of course - but just good business sense - there are other projects in the works to consider as well.
Cheers Elven
Were off to Hobbiton finally!
Tolkien was a Capricorn!!
Russell Crowe for Beorn!!
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PWOKristy
Bree
May 30 2008, 12:50am
Post #8 of 31
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Thank you alot for the welcome, Sun Flower! Thank you everyone, for the excellent replies!
I have a Pleo (a robotic, sauropod dinosaur).
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Sunflower
Valinor
May 30 2008, 1:27am
Post #9 of 31
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But they'd better not watch TOO much.
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We expect the same high-quality production values this time around--the same fantastic sets, costumes, armor, props, bigatures, mo-cap technology, (as well as GDT's vaunted animatronics), EVERYTHING. Budgeting must NOT interfere with the quality of the films one iota. If that means throwing money around, then they'd darn well better be blowing bubbles full of bills across the Pacific.
(This post was edited by Sunflower on May 30 2008, 1:32am)
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Empedocles
Rivendell
May 30 2008, 1:59am
Post #11 of 31
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If Hobbit shares were for sale, I'll buy them all, and with my eyes closed. Unless GDT and PJ make a seriously ridiculous huge amount of mistakes (which I'm sure they won't because they're just too darn smart), there's nothing that can stop this movie from being the biggest hit of 2011. Think about Phantom Menace, it's like, well, I don't even need to say it, in spite of all its flaws, it's the 5th biggest-grossing movie ever. And, in terms of fan-waiting frenzy, The Hobbit is going to be pretty similar. Luckily for us, there are no Jar Jar Binks in the book.
Please, give us back Glorfindel!!!
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PWOKristy
Bree
May 30 2008, 2:02am
Post #12 of 31
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I agree with ya, Sunflower, on what you're saying. But I do wanna say this. The budget pays for the movies themselves. The budget pays for the top rated C.G.I., the actors, the vast, varied crew people, the used land/land that is used, the sound stages ect.. It makes movies what they are, so that directors can do what they want/imagine/dream.
I have a Pleo (a robotic, sauropod dinosaur).
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MrCere
Sr. Staff
May 30 2008, 4:40am
Post #13 of 31
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The 'real' budget isn't done yet
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A film cannot have a budget until a film has a script. The script, when approved, actually goes through a budget audit while costs for sets, actors, special effects, days of filming, locations and everything else gets hammered out into an estimated budget.
Nobody exactly knows how much the film will cost until it is written and then, perhaps re-written to save money. The original Hellboy film, for example, was much "bigger" on paper until budgeting.
The studio is setting a mark for now of what it thinks and hopes and plans the two films will cost. Inflation make the price go up as will the asking price of the actors, the executive producer (PJ) a director, a more accomplished special effects company and the like.
Sequels, even when they are prequels, are more expensive.
I have no choice but to believe in free will.
The cake is a lie
The cake is a lie
The cake is a lie
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Sunflower
Valinor
May 30 2008, 6:46am
Post #14 of 31
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The origional Hellboy may have been rewritten to save money b/c the studio felt they could push a humble up-and-comer like GDT around at the time. His talk of having been bruised by the Studios on more than one occasion, I don't know if it was this one. All the more so, maybe b/c he was a Mexican director. And he was bitter about the experience and determined that it should never happen again.
From the way the LOTR films turned out, (with PJ filming EVERYTHING), and there being tons of unused footage, it suggests that New Line let them have an extrordinary amount of autonomy. That was Bob Shaye, before he became an (expletive deleted) for you.
Warner's, on the other hand, may just be a bunch of unmitigated greedy idiots, trying to squeeze the largest amount out for the least amount of coin, It's just the way they'd operate. Typical greedy skinflints. And, of course, they'll try to stiff GDT and his actors the same way NL tried to stiff PJ and his crew. It';s just the way they are.
They'll especially be trying to do this b/c, as someone said, all the "talent" involved is high-profile and big name now. But this is a Tolkien adaptation, there is NO POSSIBILTY of skimping on the script. I dread many studio battles to come. And I hope that GDT and PJ teach them early on that they CANNOT be pushed around. That's why it's a good thing that Our Three are collaborating with GDT on the scriptwriting. In retrospect, that may turn out to have been the hardest part. And it'll settle all creative control issues.....there won't be fighting over what we see onscreen. Not that I expect any, but both these directors have large (creative) egos and personal visions.
(This post was edited by Sunflower on May 30 2008, 6:52am)
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Elven
Valinor
May 30 2008, 7:25am
Post #15 of 31
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HOPEFULLY the better used and distributed these resources will be, (or should be) and end up giving us the best film we could possibly have 
I doubt they will scrimp at all - they know its not worth the fight with PJ nor the trip to NZ to scold him for approving that hand made fire poker and earthenware jug set in 3 different sizes and the giant blowup Smaug
150 million seems like at least enough for coffees
Im sure they will raise the bar once they know where the film is heading and the script is completed as well.
Were off to Hobbiton finally!
Tolkien was a Capricorn!!
Russell Crowe for Beorn!!
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Elven
Valinor
May 30 2008, 7:35am
Post #16 of 31
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... and I think PJ has a way with saying "Can I have some more please?" and getting it, as what happened with the trilogy.
... and (sorry MrCere) I posted the same as you said basically - before I got to your post ...
And theres also the variables of the finance exchange market at the moment - and this will fluctuate alot too over the years - the US$ has lost some value, so making these films (at the current market) will pose some recalculating as well - though I suppose it depends on where the finance is coming from - so regardless - these films will be more expensive to make in NZ than say, in comparison $4$, of the trilogy) ...
Were off to Hobbiton finally!
Tolkien was a Capricorn!!
Russell Crowe for Beorn!!
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FarFromHome
Valinor
May 30 2008, 8:50am
Post #17 of 31
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I do know that NL saved a lot of money by selling off the distributors rights to a lot of countries.
I've read that one of the reasons NL didn't have the cash to pay its creditors (including PJ and now the Tolkien Estate) was because they had sold off the distribution rights in other countries. So when the movies made a huge profit, triggering the percentage claims of PJ, CT and others, NL were stuck since they'd sold off their own rights to that profit before the films were even made.
...and the sails were drawn up, and the wind blew,
and slowly the ship slipped away down the long grey firth;
and the light of the glass of Galadriel that Frodo bore
glimmered and was lost.
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FarFromHome
Valinor
May 30 2008, 9:04am
Post #18 of 31
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as outlined in his book is that a lot of special conditions existed for the filming of LotR. Here's a quote:
The cold, hard truth, however, is that Hollywood couldn't have made this movie. Working within the traditional system, The Lord of the Rings would have taken ten years and cost a billion dollars. It just wouldn't have worked. Most of the time in Hollywood, everyone looks out for themselves. On this project, just about everyone, to some extent, sublimated their own immediate self-interests to be part of the process and get the work done.
But that was then, when people were excited about making this particular movie, and no-one knew how financially successful it would turn out to be. As Sean Astin says, these movies weren't made under Hollywood rules, because the laws are different in New Zealand. I don't know how much things will have changed for The Hobbit, but I assume that now everyone knows that there's lots of money to be made, their attitude will be a little different in terms of working long hours for low pay and so on, just out of a love for the project.
One example of the attitude of the people making LotR is in the extras on the RotK-EE. The charge of the Rohirrim on the Pelennor was filmed using extras who'd brought their own horses, and camped out with them for days, for very little pay - far less that union rates, I'm sure. They just wanted to be a part of the story. This was all new to New Zealanders at the time, and they seem to have been caught up in the desire to make something special, rather than feeling they were just working for pay. Maybe this is about as close to "art for art's sake" that a blockbuster movie could ever come.
...and the sails were drawn up, and the wind blew,
and slowly the ship slipped away down the long grey firth;
and the light of the glass of Galadriel that Frodo bore
glimmered and was lost.
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Peredhil lover
Valinor
May 30 2008, 9:16am
Post #19 of 31
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for 'The Golden Compass', but I don't believe the same goes for LotR. That made enough money in USA alone. Plus, there are so many franchise products tied to it that filled NL's pockets, too. More likely that is what NL wants people to *believe*.
I do not suffer from LotR obsession - I enjoy every minute of it.
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leo
Rohan
May 30 2008, 9:45am
Post #20 of 31
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LOTR cost a lot less because..
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... at the time, a real US Dollar would get you very far in NZ ;-)
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leo
Rohan
May 30 2008, 9:49am
Post #21 of 31
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.. but for New Line it did indeed mean they missed out on a lot of money. On the other hand, at the beginning of the project they got the funds they needed to pay the bills. Because even for New Line (which was a small company before LOTR) the 300+ million dollars the movies cost was a big amount.
As for the foreign distributors, they had bought a little goldnugget and made a lot of money. The Dutch distributor for instance was a very small player before they invested a lot of money in New Line/LOTR. But they made so much money, they are now the leading distributor in Holland. Go figure...
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Elven
Valinor
May 30 2008, 11:48am
Post #22 of 31
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... and maybe this time, they'll remember to take the tax breaks ...
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cause last time they didn't - D'Oh!!
Were off to Hobbiton finally!
Tolkien was a Capricorn!!
Russell Crowe for Beorn!!
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merklynn
Lorien
May 30 2008, 1:16pm
Post #23 of 31
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I would say the reason is inflation. LOTR was made nearly 10 years ago. Movies were less expensive in general than they are now... I say less, but of course they were still insanely huge budgets back then. However, the attraction that New Line would have had to PJs three picture deal was that he was keeping each film to around $100 million each, which for the time was pretty amazing considering the scope of the films.
It's 2008, and your average big budget film is now getting to be $150 to $200 million. Take Potter, Batman, Indiana Jones, Narnia, etc as examples of this. The scope of The Hobbit should make each film $200 million easy, and so $150 mill is actually still a very good deal for what the likely box office returns could be for The Hobbit and F2.
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Solicitr
Gondor
May 30 2008, 2:22pm
Post #24 of 31
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...that the price of fuel has made all those flights to New Zealand a LOT more expensive!
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merklynn
Lorien
May 30 2008, 2:27pm
Post #25 of 31
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I'd say thats the extra $50 million right there! LOL //
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