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Old June 14 2013, 01:49 AM   #7
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Re: Spielberg Predicts 'Implosion' of Film Industry

Honest accounting would change the industry beyond recognition.

A string of flops? Not so much. Part of the budgets are fictions, designed to inflate supposed costs, to hide profits, i.e., falsify monies that are supposed to be shared. Much of it never leaves the studio. Plus the ancillary revenues from television rights and DVD sales can be substantial. Plus the hit/flop distinction in popular reporting still tends to ignore foreign box office. So some movies that are supposedly huge flops, such as Alexander, still end up making money.

What can (and will) happen, is basically borrowing short (to make blockbusters) and lending long (not making a profit for three years.) But will it happen to enough studios at the same time so that the whole system collapses? Seems doubtful.
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