Tuesday, June 07, 2005
Study shows G-rated fare more profitable
A new study set to be released Tuesday shows that family-friendly movies are more profitable than R-rated films, throwing more fuel onto the fire of the long-running debate over sex and violence in entertainment -- and whether it sells.
The survey was commissioned by the Dove Foundation, a Grand Rapids, Mich.-based group that advocates wholesome family entertainment. According to its Web site, its advisory board includes radio talk show host Laura Schlessinger and "Touched By an Angel" executive producer Martha Williamson.
In a follow-up to a 10-year study commissioned by the foundation in 1999 -- which found that between 1988-97 the average G-rated film made eight times the profit of an R-rated picture -- an extension of that study found that trend continuing and expanding.
The new, expanded study examines the revenue and production costs for 3,000 Motion Picture Assn. of America-rated theatrical films released between Jan. 1, 1989, and Dec. 31, 2003, using the 200 most widely distributed films each year based on the number of theaters.
"While the movie industry produced nearly 12 times more R-rated films than G-rated films from 1989-2003, the average G-rated film produced 11 times greater profit than its R-rated counterpart," said Dick Rolfe, the group's founder and chairman.
The new study found that the average profit for films rated G rose to $92.3 million from $74.2 million, PG vaulted to $78.8 million from $9.9 million, PG-13 rose to $45.6 million from $15.4 million, and R-rated films increased to $17.9 million from $3 million. The study notes that those increases are probably due in part to higher ticket prices, coupled with a decrease in home video manufacturing costs.
At the same time, on average more G and PG-13 films are being made and released. Since the first study was released in 1999, Rolfe noted that there has been a slight production shift toward more family-friendly films: "The production of R-rated films has dropped by 12%, while G-rated fare has increased by 38%." The average number of R-rated films released each year dropped to 93 from 105, G-rated films increased to 10 from seven, PG-rated films decreased to 21 from 36, and PG-13 rated films rose to 75 from 50.
"Dove is not suggesting that Hollywood produce only G and PG movies," he said. "We just think the proportionality is out of balance, given the relatively few, highly profitable family-friendly movies released each year. Our study reveals that Hollywood is not serving the most prolific audience segment in the entertainment marketplace: the family."
"There is no question in my mind that Hollywood has been making more PG-13-, PG- and G-rated movies. Movies make huge sums of money when they work and have those ratings, since they have a much broader audience to draw from," said Tom Sherak, a partner at Sony-based Revolution Studios, who said he had not seen the report.
The study defined "profit" as estimated worldwide theatrical rentals (the share of box office sales retained by the studios), TV and video grosses, minus estimated negative (i.e. production) costs, prints and advertising, and video/DVD manufacturing costs. To produce an accurate rate of return, all costs and revenue used were limited to the first 24 months from the date of each release.
"Profit" in this study does not include revenue derived from merchandising, licensing or fast-food tie-ins. If those revenue streams were included, the average profit for G, PG and PG-13 films would rise dramatically, while the average profit for R-rated films would not, because sales of toys and other licensed products are rarely associated with R-rated films.
Reuters/Hollywood Reporter
Permalink
