Can someone please explain how a movie’s profit on streaming works? Do the studios assign a value to each view or something?
I guess for me the other issue with streaming is how you separate out people keeping the subscription because of the movie vs watching it because they have paid for something else and it’s available. In the old days of physical home media you picked your VHS, DVD etc but now you are more likely to watch something because it pops up so its more like TV
I know for example I have no real interest in Marvel movies but when I subscribe to Disney plus to watch Ashoka I might watch some because they are there if I’ve not seen them. If I didn’t have the sub already I wouldn’t bother unless they were on TV. If you counted me as a profit driver your really just making up profits but I can’t see how you can break it down to a level where you know if people have paid for your service because of the movie or watch the movie because its on the service
It’s not known really, but it's not a pay per view model. This is kind of one of the whole sticking point of the strikes. The service licenses the content from the studios and pays a flat fee much as would have occurred with Netflix pre-D+. Theatrically driven movies are easy. They are content tested with audiences already at the box office. Their rough values are easier to determine. Direct to streaming is also easy. The service is merely buying the product outright from the studio and paying the costs for it. Whatever marketing it would require comes out of D+ budgets. Though direct to stream content, if that flops on the service, they have now demonstrated the willingness to write it off for a tax break by removing it. That write off occurs on the D+ side - technically.
So for example we know D+ paid a bit more for DS: MoM > Wakanda Forever > Thor Ragnarok and it paid a paltry amount to Strange World. This tracks with box office and the general expected reception.
While the formula is 'not known' and likely never will be, there are residuals that need to be paid out. This eventually lets the trades figure it out after the fact. It also puts Disney+ in a position of relative honesty. They cannot underpay for the content or the talent sues them for suppressing the contents earning. They are not going to overpay for the content either, or they really achieve nothing but paying out higher residuals. The content is all internal otherwise, technically under the broader umbrella.
What they do however do IS pay for the content. Disney+ is spending 4 billion a quarter currently on content that ensures most of it is paid for. If Secret Wars is disappointing, it technically comes out in the wash for D+. The studios recoup all their money regardless for the budget.
If a non-D+ Studio theatrical film severely underperforms in the box office AND therefore receives a small licensing fee, the Studio reports that loss. On the flip side if a movie over-indexes like Encanto on the streaming service, the studio probably doesn't see a huge increase in payout. D+ in the wash licensed out something and overall in the wash 'gained' on their platforms perception.
I don't know at what point movies stop being paid for, if ever. Presumably the content the service 'bought' as direct to streaming it just owns. But what about really old studio content. For example does D+ pay to license Snow White as part of their content budget.