As for the profit mechanism of movies, he only knows a rough idea... He knows that movies mainly rely on box office profits. In addition to box office, they can also make profits by implanting advertisements, film copyrights, etc.

However, all he knew was this, and he didn't know the specific details at all.

This is absolutely not possible.

Since he wants to invest in movies, he must first understand the basic rules and profit mechanism of the film market. If he doesn't understand anything, he will rashly enter, and the possibility of failure is too high.

Therefore, before he formally talked about investment with Jia Ling, he needed to take a Baidu first and make some knowledge reserves.

He held his cell phone and checked it for more than an hour until twelve:30 in the evening, and finally understood everything he wanted to know clearly.

According to the information he found online, the main revenue composition of domestic movies is: box office revenue, copyright revenue, overseas sales, business cooperation, authorization and derivatives, government subsidies, industry subsidies, etc.

Box office revenue: The biggest revenue of a movie generally accounts for more than 80% of the overall revenue.

Copyright income: mainly refers to TV screening rights and Internet broadcasting copyright sales... There is only one TV screening rights that is more reliable, that is CCTV6. CCTV6 is usually a one-time buyout, with the acquisition fee ranging from 1.6 million to 4 million; the price of Internet broadcasting copyright sales fluctuates greatly, generally between hundreds of thousands and millions, tens of millions, and hundreds of millions, but very few, which are basically exceptions.

Overseas sales: It means selling movies to other countries and Hong Kong, Macao and Taiwan. This part of the revenue is very little, and for most movies, it is almost negligible.

Business cooperation: mainly involves implanting advertising, marketing cooperation, event naming, etc. In this regard, top movies are more popular, but most movies have no chances.

Authorization and derivatives: film image, title, key visual elements, etc. This type of income is only an IP type movie, and ordinary movies cannot be made at all.

Government subsidies: it is the cultural industry subsidies led by the government, as well as special subsidies from local governments. This part of the income is also very small, and some are particularly large, but it is unlikely to obtain it except for special circumstances.

Industry subsidies: mainly for movies in 3D or giant screen formats, and the subsidy is still possible... If the box office is between 500 billion and 100 million, the reward will be one million; if the box office is between 100 million and 300 million, the reward will be two million; if the box office is between 300 million and 500 million, the reward will be five million; if the box office is above 500 million, the reward will be one million.

From the above information, we can see that although there are many ways to earn movies, most of them are for some special circumstances or special types of movies. For most movies, the main profit method is still box office.

The box office situation is also quite complicated and requires multiple accounts to be divided.

After a movie is released, the box office income generated must be paid first with a special business tax of 3.3% and a 5% special fund for the film industry, with a total tax and fee ratio of 8.3%.

The remaining 91.7% is the "separable box office" ratio of a movie.

In the "separable box office", cinemas must retain (commission) 50%, cinemas must retain 7%, and cinemas must retain 7%, and the total retaining ratio is 57%.

In addition, China Film Digital (China Film Group Digital Film Development Co., Ltd.) also reserves 1% to 3%, as the issuance agency fee...it is generally 3%.

Therefore, the "separable box office" ratio left to the producer and the publisher is only 40%.

Only when the publisher takes away 2% to 6%, the remaining 34% to 38% will the producer belong to the producer.

Overall, the profit ratio (total box office) belonging to the producer is about 33%.

However, there are some special circumstances.

For example, when the producer has no money, the distributor needs to pay the entire promotional expenses in advance. At this time, the distributor will take away more "separable box office" ratios, which will generally reach 4.8% to 8%.

Some people may say that the issuer should have borne the entire issuance fee?

Theoretically, but the film industry has an industry rule - promotion and distribution expenses are preferred for recycling in issuance collection.

What's the meaning?

To put it simply, it means that the profits generated by the box office should be deducted first before the prepaid promotional expenses, and the remaining ones will be divided into proportion.

In other words, no matter which party pays the promotional expenses, it will be charged first in the end, and this part of the funds will not be included in the later sharing... If the box office is sufficient, the party that prepaids the promotional expenses will not suffer any losses; if the box office is not ideal, the party that prepaids the promotional expenses will bear greater risks and may face the result of not being able to recover the cost.

In addition, there are many special promotional and distribution models, such as guaranteed issuance, buyout issuance, etc.

Guaranteed distribution is a relatively common distribution method in the current film industry. The specific approach is that the publisher promises a "separable box office" number to ensure the minimum return of the movie.

To give a simple example, a certain distributor made a guaranteed release of a certain movie, promising a "separable box office" of one billion... Then after the movie was released, the lowest "separable box office" would be one billion.

If the "splitable box office" obtained by reality is less than one billion, the issuer must also divide the accounts according to one billion; and if it exceeds one billion, it needs to divide the accounts according to the relevant terms of the contract.

This issuing model, the issuer bears greater risks, so the proportion of "segmentable box office" will be particularly large, generally exceeding 10%.

Buy out and issue, this is very simple, that is, the publisher directly bought the movie.

If the publisher buys the movie directly, there is nothing to do with the producer. After all, the movie has been bought by others, and that is what others have to do. Whether others make money or lose money, how much they earn or how much they pay has nothing to do with the producer.

In addition, there is another special situation that affects the producer's "separable box office" ratio, that is, "box office rebate".

Nowadays, the competition in the film market is very fierce, and the number of screens is limited... After many movies are released, they cannot gain an advantage in the competition for the same period of films and cannot get enough screening. At this time, they often use some special means.

"Box Office Rebate" is one of the more common special methods. The specific method is to make private commitments to theaters and theaters to transfer part of the "separable box office" ratio to achieve the goal of striving for more screening.

In doing so, the "splitable box office" ratio of producers and publishers usually needs to be reduced by another 3% to 5%.

Therefore, the overall profit ratio of 33% of the producer is just the ideal situation. If special events such as guaranteed issuance, buyout issuance, box office rebate, etc. occur, the profit ratio will change again.

After learning all this, Li Chuan secretly calculated the return on investment of "Hello, Li Huanying".

‘If I voted for "Hello, Li Huanying" and had a certain voice, then this movie would definitely not be released for a guaranteed release or a buyout release. The box office rebate may be made, but with the box office momentum of "Hello, Li Huanying", it seems that there is no need for it.’

‘In this case, you only need to calculate according to the ideal situation.’

‘The box office of "Hello, Li Huanying" in later generations exceeded 5 billion, and I don’t know if it’s more than 5 billion, so let’s count it for 5 billion… The production cost is 100 million.

33% of 5 billion is 1.65 billion, and then divided by 100 million production cost, the return on investment is 16.5 times.’

‘16.5 times…’

Li Chuan's face became entangled.

Although the return on investment of 16.5 times is already very high, it is still not as good as the Bitcoin he invested in before.

He can get a 15-fold return rate if he invests in Bitcoin. If he makes another T in the middle, it will become 30 times.

16.5 times and 30 times, the gap is still very big.

This is also a point that makes him feel confused.

Judging from the data alone, he doesn't seem to need to invest in "Hello, Li Huanying" and just focus on speculating on Bitcoin, which will make a higher profit.

However, after a while of confusion, he decided to invest in "Hello, Li Huanying".

Why?

Because he wants to diversify his investment.

He used all his money to speculate on Bitcoin, which was too easy to regulate, too easily suspected, and too easy to have problems... Once Bitcoin has problems, he may lose all his money.

Appropriate diversification of investment can effectively ensure the safety of his funds. If one party has problems, the other party will provide support. At that time, he will not lose all his money.

From this perspective, "Hello, Li Huanying" is a good choice, after all, this project has a 16.5x return on investment.

16.5 times, it's really very high.

Apart from Bitcoin, he doesn't know which investment target can exceed this number.

Rationally judge, this is a very rare investment project. Since you have encountered it, you must seize it!
Chapter completed!