Ashley Cullins writes about agents, lawyers and dealmakers for paid subscribers. She recently covered how to sell an indie film now; the fight against if-come deals; and the New Rules of Film Finance. You can reach her at ashley@theankler.com
Whether your preferred euphemism is “cost conscious” or “risk averse,” everyone in Hollywood is speculating about how the studios and streamers are going to respond as margins slim and the budgets creep up faster than you can say “price of eggs.”
“A studio can’t have 12 big movies. [But] they do need to fill out that slate,” says an agency insider. “They’re doing financial models for every movie they’re considering greenlighting and looking at — whether it’s box office or how many views or whatever their internal metric is — how confident are they that it’s going to hit not just what their version of break even is, but actually achieve their version of success? Every dollar counts in terms of the risk-reward of it.”
With wildly varying business models, success looks different for each studio and streamer, and they’re all a bit mercurial. “Hollywood is cyclical and trendy,” says talent lawyer Jeff Frankel, a partner at the boutique Beverly Hills firm McKuin Frankel Whitehead. He’d love to see a return to dramas like The Verdict and Dog Day Afternoon, but laments “they don’t have a home. They’re too expensive for streaming and they don’t believe the audience will spend enough to go see them in theaters.”
Maybe that’s because the top 20 movies at the domestic box office in 2024 were all either new franchise installments or adaptations of popular IP. Still, as the agent said, you can’t stack a slate with only tentpoles.
So, while everyone is buzzing about contraction, I wanted to find out how studios are actually responding to these market conditions — especially when it comes to original features. When will they take a swing and what’s too risky? How much are they spending, where are they cutting costs and who can still count on a big payday?
In talking with dealmakers across town about what they are seeing in their day-to-day work, a consistent theme emerges that creates a pretty clear mosaic of the state of play at the moment.
In this issue, I’ll tell you:
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The budget range that is a “no man’s land” to greenlight now
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What Netflix will pay for an original feature now
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How much producers can expect to get paid at Netflix no matter the budget
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How backend models at Netflix, Amazon and Apple have evolved
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Why dealmakers and talent don’t like Netflix’s new performance-based system
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Why studios are making fewer films rather than slashing budgets
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How Amazon offers more potential upside for streaming hits
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Who’s taking a pay cut — and who’s still cashing in
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The real reason some mega-stars are taking streaming buyouts
