Theatrical

On average, G-rated films generated profits of $79 million per picture....

SoftSpot Entertainment will seek to exploit the largest film audience market through production of medium and low budget films suitable for families and children. In other words, we will not produce R rated films. Some of our titles will be aimed at the teen/ adult market but more toward the children's/family film audiences.  Based on current film audience statistics, we feel that a lower budget family film has a chance to be more profitable than a large budgeted R rated film.

 

The following "Family Films Profitablity" information comes from the Dove Foundation website.

More consistently than any other genre, family films have historically produced the best return on investment (ROI) for Hollywood [1]. This is due to the fact that G- and PG-rated films have the widest possible audiences, including both adults and children. A 15-year study commissioned by The Dove Foundation and conducted by Kagan Media Appraisals, released in May 2005, found that:

 

    • The average G-rated studio film produced 11 times greater profit than its R-rated counterpart.
    • The average ROI for G and PG and Pg-13-rated pictures released between 2000-2003 was 94.5% ,72.6%, and 43.65 respectively.

The Dove Foundation study further states that, on average, G-rated films generated profits of $79 million per picture while only accounting for 4% of the movies produced during the 15-year study period. PG-rated films made up 16% of the study and averaged $28.3 million each, PG-13 accounted for 28% with $23.5 million in profits, while R-rated films comprised the majority of the study at 52%, though averaged only $7 million in profits per film.PG-13 worldwide home video sales were slightly higher than PG. [1] Fortune, January 10, 2005


Top Grossing MPPA Rating 1995 to 2008 (From www.the-numbers.com)

Movies

Percent

Average Gross excluding DVDs

PG-13

44.10%

$55,287,160,306

R

30.42%

$38,144,708,000

PG

18.61%

$23,332,335,384

G

5.70%

$7,152,692,823

Not Rated

0.91%

$1,145,678,051

NC-17

0.05%

$64,972,526

Open

0.01%

$6,552,781


Movie studio executives have to choose among thousands of scripts to decide which ones to turn into movies.  They rely largely on guesswork based on he or she’s experience and intuition. Despite the huge amount of money at stake, green-lighting a movie can work but can also fail.  There is statistical data that supports SoftSpot Entertainments’ decision to exploit the family and children’s film genre. SoftSpot Entertainment will be seeking a G, PG or PG-13 MPAA rating for all Projects produced.

 

HOME VIDEO The home video distribution business involves the promotion and sale of DVDs to local, regional and national video retailers (i.e. video specially stores, convenience stores, record stores and other outlets), which then rent or sell such DVDs to consumers primarily for private viewing. When DVDs are sold directly to the public they are priced significantly lower than the prices charged to wholesalers who will rent the video. This direct sale to consumers is commonly referred to as the "sell-through market. DVD distribution would be based on a partnership with a distribution company and we would only be able to gain a percentage of 8% to 26% of sales after cost. Blockbuster Video will produce no less than 5 copies per store and can produce all or part of they’re 8,300 locations in 23 countries. The manufacture will receive an up front payment of $6.00 to $9.00 per unit. On the low side that would be $249,000.00 per Projects before any residuals from rentals.

Please keep in mind that the numbers are only estimates based on industry knowledge and industry reports. All of the above is directly affected by thousands of variables and it will not be what I am estimating for sure.

 

Consumer Spending (Figures from Home Media Retailing and DEG: Digital Entertainment Group, unless otherwise noted)

 

Figures compiled by DEG: The Digital Entertainment Group on behalf of the studios show consumers spent $16 billion on buying DVDs in 2007, down from $16.6 billion in 2006. Next-generation media sales, both Blu-ray Disc and HD DVD, added another $300 million to the pie, while the rental business was flat at $7.5 billion.

The DEG also says 33 million DVD players were sold to U.S. consumers in 2007, about the same as last year, with 12 million players selling in the fourth quarter. That puts the total number of DVD players in U.S. homes to 230 million, counting portable units and televisions with built-in DVD players.

The DEG pegs the U.S. household penetration rate at 90%, with 60% of households having more than one DVD player.

Counting game consoles, 4.5 million high-definition media players have been sold to consumers since the first players arrived in 2006. Toshiba shipped its first HD DVD player in April 2006, while the first dedicated Blu-ray players showed up in late June — followed in November by PlayStation 3, with a built-in Blu-ray Disc drive.