How China Entertainment was developed

Chapter 855: The purchase price is negative, so even if the selling price is zero, you will still make a profit!
2 month 25 day.

Another year's Spring Festival period in the mainland film market has come to an end.

The biggest winner of this Spring Festival is undoubtedly Changgong Film and Television.

Because Changgong Films not only became the main screening platform for this Spring Festival movie, but also took 10% of the box office revenue of each movie out of thin air.

Moreover, in the in-depth cooperation of buying out film distribution, it picked up a big bargain and bought out the revenue of 2.7 to 2.8 billion yuan of "Hello, Li Huanying" with an investment of 80 million yuan.

It also achieved a brilliant record of zero losses and full profits in all bought-out film projects.

"How is it possible that all four buyout projects are profitable? Doesn't the data show that, except for Hello, Li Huanying, the box office performance of other movies is not ideal?"

Zhang Nan was a little confused when he saw the report of Changgong Film and Television's Spring Festival period presented by the person in charge.

Because in his memory, in addition to "Hello, Li Huanying", the other three movies "I Cheer for You", "No Mr. and Good Lady", and "Awakening Golden City" had box office of RMB 1575 million, RMB 97.3 and RMB 5.9 respectively.

The 1575 million RMB box office of "I Cheer For You" may have made a small profit, and Zhang Nan said he could understand that.

But how did "Awakening Golden City" with a box office of 5.9 RMB make a profit?

"You wouldn't transfer part of the revenue from "Hello, Li Huanying" to these projects just to make the financial statements look good, right?" Zhang Nan guessed.

After hearing what Zhang Nan said, the person in charge of the report shook his head and explained: "That is fraud, which is illegal. If you are caught, you will go to jail. Everything on the report is true."

"Then explain to me how this movie, which grossed 5.9 RMB, made a profit. Based on this movie's box office data, it can't even recoup the cost of the movie, not to mention that we paid a % premium on the buyout price." Zhang Nan said, pointing to the project name on the report.

This is indeed the case.

Not to mention the current inflation in the mainland, even in Hong Kong in the 1970s and 1980s, the cost of making a movie was nearly one million Hong Kong dollars.

It is impossible for a movie with a box office of 5.9 RMB to recover its costs, let alone make a profit after being bought out at a premium of times the cost.

"Director Zhang, you may not know the specific details of these movies. These movies are all projects where parents support their children's acting careers." The person in charge of reporting the report glanced at Zhang Nan carefully and explained in a low voice.

"..."

Zhang Nan was immediately confused. "What do you mean by parents supporting their children's acting career?"

"It's the kind of project where parents pay someone to make a movie for their children, to help them realize their dreams of becoming stars. For such projects, the investors don't care whether the movie makes money or not, they only care whether the children are satisfied and whether it can be screened on a larger platform.

Projects like this already have a complete upstream and downstream industrial chain in each film and television city.

It’s just that other film and television cities are more likely to deceive people in this regard.

Our Changgong Film and Television City is very formal and complete in the management of this type of projects.

So even though the acting skills, life experiences, etc. of these rich daughters and second generations are all very embarrassing.

At the same time, the script and filming team we provided were relatively ordinary and inexperienced.

However, the film industry system of our Changgong Film and Television City is already relatively complete.

Therefore, the quality of the films produced by the final assembly line, although not comparable to real professional film projects, is still of acceptable level. If you find a suitable release date, you can basically get back 60% to 70% or 70% to 80% of the cost. If you are lucky, you may even make a small profit. "The person in charge said at length.

Zhang Nan was stunned and asked stupidly, "So... these projects are born in our Changgong Film and Television City with the film industry system. But no matter how well-assembled they are, they can't make back their investment with a box office of 5.9 RMB!"

“Not all of them, only the movie [I Cheer for You] was produced in our Changgong Film and Television City using the film industry system.

Moreover, in this project, the parents of the male and female protagonists are very capable, and they also sought help from many professionals. The final quality of the film was quite good, so we released it during the Spring Festival, and it lived up to expectations and took in a box office of 1575 million RMB.

The cost of the film was RMB 600 million, and we acquired it at a premium of 900 times for RMB 465 million, so all in all, we made a profit of RMB million.

The remaining two are completely rip-offs of other film and television studios.

We don't dare to release a movie of this quality during the Spring Festival, but other film and television cities don't have this concern.

In addition, the purpose of this kind of project is to bring fame to one's sons and daughters.

So when they heard that a big platform like us was buying out the distribution, they thought it was a good resume for their children, so they sold it to us at a complete loss. "The relevant person in charge continued to explain.

"What does a complete loss mean?" Zhang Nan was a little unfamiliar with this term.

The relevant person in charge said: "Just... give us money."

Zhang Nan: "..."

Good guy, really good guy.

This is the first time I heard of a producer selling a film to a distributor and still paying the copyright fee.

This is outrageous.

I can only say that all parents in the world are so pitiful!
But in this way, the report makes perfect sense.

Don’t even mention the 5.9 RMB box office. Even if it was just one dollar, it would still be profitable on paper.

After all, the purchase price is a negative number, so even if the selling price is zero, you’ll still make a profit!
But this situation was still a bit of a shock to Zhang Nan, and it took Zhang Nan a while to recover.

However, it was during this period of time that Zhang Nan suddenly thought of something.

That is what the mainland film and television industry will be like in the future. It can be said that there will be a lot of bad movies and money-making works.

Short video platforms have risen rapidly, especially the exaggerated content short videos of Long Aotian's micro-scripts, which became popular and opened up a new track.

It just so happens that the film industry system of Changgong Film and Television City has been completed.

If we can standardize this new track of Long Aotian's micro-scripts and make them less shocking, and find a group of new screenwriters who have just entered the industry to write some qualified micro-scripts, we can rely on the system of Changgong Film and Television City to continuously output qualified and normal content.

Then maybe we can make the micro-script video track one of the regular tracks in the mainland film market.

Then, the artists who have become successful in micro-script videos will be promoted to regular big-budget movies. This may create a momentum where good money drives out bad money and change the false prosperity of the mainland film and television industry in the future.

(End of this chapter)