Box-Office Payola?

Chris Anderson, the editor-in-chief of Wired magazine, has a long-running website called The Long Tail. Now he has just published his book of the same name, and it’s doing great. (Congrats; I haven’t read it yet, but it sounds good.) What caught my eye on his website was this fascinating note (end of the post) from an anonymous writer regarding movie box-office figures, how and why they may be inflated, and why they often fall so dramatically after one or two weeks. Here’s what the anonymous source had to say:

I happened to be riding to work with an exec from one of the major studios this morning, and he mentioned that the studios are increasingly making deals with theaters to inflate opening numbers. In particular, they will give the theaters very high revenue share for the first X days of the movie (he mentioned 100% for the first 3 days), incentivizing the theater to maximize the number of screens the movie’s shown on, inflating opening numbers.

I have no idea how true or prevalent this is, but something you might want to look into. This would be done for movies which the studio considers potential “hits”, increasing discrepancy between them and normal movies.

To me, 100% of the take even for three days sounds ludicrous, but I could certainly imagine the promise of inflating the real figures by 25% for an additional 5 or 10% of the short-term take. I’ve always assumed the reported box-office figures were pretty much made up, anyway. But, as widely as these figures are reported these days, essentially serving as the best marketing a movie could hope for, I would think there’s plenty of value in paying to drive up those first-week numbers as high as possible. It’s hard to imagine anyone in Hollywood objecting, really: studios and producers all want to look more successful than they are, and actors and directors get to negotiate their next deal based on inflated figures.