Big Six

When you watch a movie, whether it be at the cinema or in the comfort of your own home, it's seldom you actually think about where the movie was produced and how each film company secured the rights to the movie you're watching on the screen. The movie business is extremely competitive. The six major film companies discussed below comprise 90 percent of the US and Canadian box office revenue. If you're pondering a career in film, you may want to pay very close attention to the statistics below.
And while there are a few "mini-majors" still turning a profit in the industry (Lions Gate Entertainment and MGM for example), it's fairly difficult for film companies to stay afloat while competing with these highly successful empires.

Below you will find the six major film companies (also known as "The Big Six") and a brief description of each:

1. Warner Bros. Pictures. Comprising a whopping 19.7 percent of the US/Canadian market share (2007 figures), Warner Bros. Pictures is the biggest player in the film industry. Securing the rights to major films like Harry Potter, Superman, Batman, The Matrix and Star Wars have made Warner Bros. the No. 1 name in the business.

2. Paramount Pictures. With 15.5 percent of the US/Canadian market share (2007 figures), Paramount Pictures continues to be one of the most successful film production companies in the world. Star Trek, War of the Worlds, the Mission Impossible series, Transformers and Tropic Thunder are just a few of the popular films produced by Paramount Pictures.

3. Walt Disney. One of the most renowned film production companies in the history of the business, Walt Disney now holds 15.3 percent of the US/Canadian market share (2007 figures). With highly successful movies like Pirates of the Caribbean, National Treasure, Meet the Robinsons and Enchanted, there's no doubt that Disney will continue to play a key role in the industry for years to come.

4. Columbia Pictures. Comprising 12.9 percent of the US/Canadian market share (2007 figures), Columbia Pictures remains a big player in the business. Some of this company's recent successes include Casino Royale, The Da Vinci Code, the Spider-Man series and Step Brothers.

5. Universal Studios. 12.2 percent of the US/Canadian market share (2007 figures) belongs to Universal Studios, which continues to make millions for the film industry. With major hits like the Bourne series (Bourne Identity, Bourne Supremacy and Bourne Ultimatum), The American Pie series, Knocked Up, American Gangster and The Incredible Hulk, it's very clear that Universal Studios knows what it takes to make money in this industry.

6. 20th Century Fox. Also known as "Twentieth Century Fox," this highly successful movie production company makes up 11.9 percent of the US/Canadian market share (2007 figures). Some of the biggest and most successful movies from this empire include the X-Men series, Mr. and Mrs. Smith, Star Wars Episodes II and III, and the Fantastic Four.

Netflix vs Amazon - what's their role in the film industry?

Fox Searchlight Pictures

Fox searchlight pictures from Great Baddow High School Media

Similarities and Differences between blockbuster and low budget film

Unit G322 – Section B – The Film Industry

To begin comparing both ends of the industry to use this as a model. Create a two column comparison between your low budget film and your blockbuster

Although the institutions are clearly very different there are some similarities which you need to be aware of so make sure you have a clear journey from planning to exhibition of both your case studies.

Here is an example, answer each bullet point with facts from your own films and this will serve as one of your revision sheets.

FILMS

Ill Manors / Skyfall

Any Similarities between the two films in terms of genre and narrative

·     They’re both British films – Ill Manors is more ‘British’ than Skyfall (deals with social issues and themes relating to British society). Funded and filmed in Britain.

·     They were both filmed predominantly in Britain.

·     Both enjoyed strong opening weekends at the Box office

·     Large British cast in both.

·     They both have a high profile musician linked with the film whose music was released close to the film’s release.

 Ill Manors / Skyfall – Differences between the two films in terms of genre and narrative

·     Different genres – Skyfall is an Action/Adventure and Ill Manors is a gritty social realist drama.

·     Bond is a part of long running (47 years and counting) franchise. Ill Manors isn’t.

INSTITUTIONS

BBC Films & Film London Microwave /Sony  – Similarities

·     Both involved in film production.

·     Both are companies whose main goal is to make profit – both are driven by the bottom line.

·     Both split production across different companies “film is fundamentally a collaborative medium”.

BBC films & Microwave / Sony – Differences

·     Budget – Ill Manors £100,000 Million 

·     Skyfall $150-200M.

·     BBC Films and Microwave are low budget independent film making companies – Sony is a major global conglomerate with a diverse range of interests.

·     Sony work on lots of films each year such as…..enabling them to spread their risk; BBC Films and Microwave only work on a few each year (what other films have they made?)

·     Sony are involved in production (MGM), distribution (Columbia Tristar and Sony Pictures Entertainment) and exhibition (Sony Blu-ray machines/ Sony DVD Players/ Sony TVs / Sony phones.) THIS IS CALLED VERTICAL INTEGRATION.

BBC Films and Film London Microwave are ONLY involved in film production.

Sony – well established.  Microwave – new company in its infancy.

Sony are better placed to withstand losses.  BBC Films and Film London Microwave cannot sustain losses.

Sony make films with leading directors – BBC Films and Film London Microwave focus on new directors.

BBC Films and Film London Microwave films will mainly be distributed in the UK to a selection of cinemas

Sony – makes films distributed globally and  internationally

AUDIENCES

BBC Films and Film London Microwave

 –  AUDIENCE DIFFERENCES

·     Skyfall was aimed at a huge mainstream target audience:15 – 55 year olds.  Core male target audience with a wider secondary female audience, straddling broad cross sections of class, ethnicity and sexuality. 

·     Ill Manors was aimed at a niche audience – urban 16-24 year olds, heavily pitched at a male audience.

·     Skyfall is aimed at an international audience so the dialogue/script is less specific than Ill manors which uses contemporary urban colloquialisms.

PRODUCTION / DISTRIBUTION / EXHIBITION

BBC Films and Film London Microwave – PRODUCTION DIFFERENCES

·     Skyfall had a huge budget – Ill Manors didn’t.

·     Skyfall used a host of well known famous ‘stars’ – Daniel Craig, Judi Dench etc – Most of the cast of Il Manors were unknown or first time actors (apart from the main star) so cast were less recognizable.

·     Skyfall used exotic and varied locations round the world – Ill Manor’s setting was much more geographically specific, as exotic locations weren’t called for in the story.

·     Skyfall used a lot of expensive special effects.  Ill Manors didn’t.

·     Skyfall utilized product placement within the film – Heinekein, Coke, Aston Martin, Omega. Ill Manors didn’t.

·     Skyfall had expensive action sequences – highly produced fight and chase scenes. (writing off various cars!)  Ill Manors’s dramatic scenes were less full of action.  

Ill Manors / Skyfall –  DISTRIBUTION DIFFERENCES

·     Skyfall’s marketing campaign was huge and extensive. Ill Manors’s marketing was very specific and highly targeted.

·     Skyfall used synergy Eg Sony PS3, phones, games, DVD, TV, soundtrack and film were released at the same time.  Whereas Ill Manors didn’t/couldn’t use synergy to the same extent by releasing just the DVD and soundtrack at the same time as the film

·     Skyfall had a series of huge international premieres – all over the world.  Ill Manors didn’t.

·     Skyfall used cross promotion through a range of companies all advertising Skyfall – Heinekein, Omega, Sony TVs, Coca-cola, etc.  Product placement earned $50Million plus ($44 M for just Heinekein alone)

·     Sony had blanket advertising  with tease trailers in cinemas, TV adverts, newspaper and radio adverts and interviews with main stars 

·     Ill Manors had much smaller advertising.

EXHIBITION DIFFERENCES

Skyfall opened in 580 cinemas – over 1000 screens in the UK and Ireland

Skyfall broke box office records and overtook the highest grossing film of all time, Avatar in terms of takings on opening night and opening weekend and overall profits globally.

Skyfall landed straight into number 1 spot on UK DVD chart. Quantum of Solace did too and hit number 2 on Blu-ray chart and became the UKs biggest selling DVD and Blu-ray release of 2009.  A worldwide box office phenomenon, broke countless records and now scores as the top grossing film of all time.

Ill Manors didn’t break box office records, nor did it get to top of the DVD or Blu-ray charts on day of release.

It played in much fewer, selected and niche cinemas.

What big films have the big six made recently?

Latest Big Six chart with conglomerate owners

Ignore CBS column and look up what other companies your conglomerate

owns so for example Disney not only have vertical integration but horizontal too

with the theme parks (free advertising) Disney channel, ABC (top US tv station),

comics and the music etc. Fox owns Fox news and Fox sport so great advertising

opportunities there too.

Synergy

The basic concept of Synergy can be explained through this mathematical formula: 1+1=3 Whilst this may not make sense to mathematicians, in business it does, when we think of profit value.

If you sell two separate products, for example a video game and a film, they could both do very well, giving you a profit of £200 million each. However if the video game and film were linked, i.e. both Harry Potter projects, this is synergy because the profit value of each will be more, perhaps £300 million each. Therefore the product value of intertied products is more than the value of two separate products.

As film students, of course you do not have to worry about mathematics, but you do need to understand the importance of synergy for the industry and to be able to identify and discuss examples. Jill Nelmes, in ‘An Introduction to Film Studies’ defines synergy strategy as: Combined or related action by a group of individuals or corporations towards a common goal, the combined effect of which exceeds the sum of the individual efforts. (Nelmes, 1996: 42)

Synergy can come in a number of different forms:

• Product Placement Companies pay to feature their product in a film, which often leads to a deal in which the film’s protagonist or other characters are featured in their advertising campaigns. Tie-ins Promotional Partnerships, where the film or its characters will feature on existing products. This may be in the form of competitions.
• Spin-Offs Products based on the original, i.e. the Film. A film may be a spin-off of a television series, or a television series may be created as a spin-off of a film. We can also think of this as media convergence.
• Pre-Existing Property If a film is based on pre-existing material (for example a video game, novel or comic book) the pre-existing material is often re-released featuring imagery from the film on its cover, or a special edition is released in synch with the film’s scheduled cinematic release.
• Merchandise Companies created products specifically for the film, for example toys, calendars, video games. These products not only help market the film, but the audience’s knowledge of the film brings their awareness to the merchandise.
• Vertical Integration When distribution and some forms of exhibition are kept in-house, meaning other subsidiaries of the conglomerate (who owns the production company) distribute the film and create DVD releases of it.

We do not consider publicity (i.e. press appearances and interviews) as a form of synergy though. Synergy is a common action of the multi-media conglomerates who own the Hollywood studios. Often they will incorporate products from their different subsidiaries. For example, one of their Studios will produce a film, one of their TV studios will create a spin-off series, and one of their games manufacturers will produce a game. This will benefit the conglomerate as their products will be cross-promoted by each other, multiplying the profits for the conglomerate. Remember conglomerates are horizontally and vertically integrated meaning they have several companies in a number of different multi-media fields, which allows them easy access to synergy opportunities.

Looking at the synergy of particular case studies allows us to analyse the structure of Hollywood, how major high concept releases get the funding and profit they do and how they are able to dominate, through their distribution campaigns, over independent films. It is an important facet of Hollywood because it enables the conglomerates to continually accumulate large sum of profit, thus enabling them to continue to make major releases and dominate over the global market. Another key issue with synergy is that it is in part responsible for the repetitive nature of Hollywood films. To encourage corporate partnerships, merchandise deals and other pre-sales, enabling large budgets to be sought means the films Hollywood produce have to be viewed as low-risk by the partners. Safe films are those which seem to be almost guaranteed to succeed (remember there are never any guarantees in the film industry!).

Partners and investors will want to see evidence that similar films have done well in the recent market, that the directors and stars’ recent films have been profitable and any pre-existing property or clear genre conventions help this. Therefore, if you look at your local cinema listings, or a film magazine like Empire and Total Film for upcoming releases, you will see there are many similarities between the major Hollywood films. Filmmaking at this level is a business and films have been potential for synergy, therefore more potential for profit if they are safe investments. Whilst we often say a film’s profit is dictated by the opening weekend box office figures; in today’s global society film’s often make as much, if not more profit, from the longevity of the film’s brand as a presence in the public sphere - this happens through synergy.

So to sum up:
•Synergy is an important part of a film’s marketing campaign- making the public aware of the film’s existence.
•Synergy is an integral reason for the success of the major conglomerates, who own Hollywood, and for their dominance over independents worldwide.
•Synergy is also a key reason for the studio’s preference towards safe films, because the safer the investment the more likely it is that they will be able to attract corporate partnerships.
•The synergy opportunities developed for a film can often be more profitable than the film itself and keep the film brand in the public sphere constantly- ideal if the studios are planning a sequel, which is more than common in contemporary Hollywood!

Case Studies: Casino Royale was produced by Metro Goldwyn Mayer (M.G.M), Columbia Pictures, United Artists and EON Productions. MGM and Columbia Pictures are both subsidiaries of Sony Corporation. Sony Pictures Entertainment and MGM then distributed the film. This is the first level of synergy we see behind Casino Royale - vertical integration. However, the sound track was released on Sony Classical and the artist Chris Cornell (of Audioslave) who performed the title song “You Know My Name” is signed to Epic Records, part of Sony BMG. The film was released on Sony Blu-ray, PSP UMD Video, as well as on DVD, and was offered as part of a package deal for customers buying the Playstation 3 (another Sony product). These releases were organised by Columbia Tristar Home Entertainment, yet another Sony subsidiary. There is a lot of product placement in the film; in fact this is how a large percentage of the budget was raised. Several Sony products include the Vaio, Sony blu-ray and Sony Ericsson phones all appear in the film.

However other companies engaged in a synergy partnership and their products featured in the film: FedEx, Omega Watches, Martini, Heineken Beer and Ford Car. The image of Daniel Craig was used in the advertising for Heineken, Martini, Omega Watches and Ford Car. The Sony Ericsson website also featured Daniel Craig as the character of James Bond.

The Avengers is perhaps one of the greatest examples of the extremes synergy can be taken. The film is based on pre-existing property and has raised the profile of its comic book characters, most of the characters have been features in spin-off television animation series, re-issues of the old comic books, or re-branded new comic book series. Tie-ins have been arranged with fast food restaurants such as McDonalds (for their happy meals), Dunkin’ Donuts and Baskin Robbins and fizzy drinks, such as Pepsi. However, the most unique facet of The Avengers marketing and synergy campaign is that each of the protagonists has their own film(s) which have been used to market The Avengers. Each of these films has had tie-ins, product placement, merchandise, computer games and spin-offs and each is based on pre-existing property - which has been exploited and promoted by the film’s release. Iron Man, Thor and Captain America have been film franchises in their own rights, but from the build up to the release of Thor it has been clear that they are all part of the campaign for The Avengers. Marvel was bought by Disney, however a pact was organised between Marvel and Paramount Pictures to produce a slate of comic book films.

The inter-relationship between two organisations owned by two different conglomerates: Disney and Viacom respectively, expresses the oligopoly nature of Hollywood. From 2012 this relationship will end leaving both with sizeable profits and Disney will continue to distribute the later films, including Iron Man 3 and The Avengers. Synergy Activity Marvel Comics and Disney-Buena Vista (who now own Marvel Comics) have decided to release a new film on their character Ms. Marvel (see her profile here: http://marvel.com/characters/bio/1010338/ms_marvel). Look at a range of existing comic book examples, www.moviemarketingmadness.com could be a helpful resources, research the different inter-linked products they have i.e. merchandise, spin-offs, cross-promotions, etc. Mind map synergy potentials for the film Ms. Marvel remember to consider the different potential audiences you could appeal to and how you could develop pre-existing property.