What happened to movies?: Market realists

The spreadsheet was correct at every step

A franchise sequel costs $200 million to produce and $150 million to market, but even a disappointing entry clears $500 million globally because the brand provides a floor. An original drama costs $40 million and $30 million. If it isn’t a hit, everything is gone. The risk-adjusted return favors the franchise every time. We did not build this structure because we hate art. We built it because the market punished studios that bet on art at scale.

The cultural declinists show Chinatown and ask where the equivalent is. Chinatown was a commercial disappointment on release. It became a classic through decades of reappraisal and home video. The secondary markets — DVD, cable licensing — that subsidized originals by giving them a long tail collapsed. Streaming pays a flat fee. There is no long tail.

Friends in the industry hate AI entering the creative process, and the fear makes sense. But the optimization preceded AI by twenty years. The medium evolutionists point to Korean cinema. Korea operates with government subsidies and a domestic audience that treats filmgoing as cultural practice. That model does not port.

Someone asked about their favorite movie since Everything Everywhere. The honest answer: the movies people love survived the system. They were never what the system was designed to produce. The audience skeptics are right that we trained the audience to expect franchises. We also can’t untrain them unilaterally.

Where we concede ground: We starved the mid-budget original and then blamed the audience for not showing up.

What would change our mind: Ten non-franchise originals per year from one studio, full marketing support, profitable in aggregate over three years.

Read the full synthesis: What happened to movies?