How do Movie Producers Make Money?

How Do Movie Producers Make Money?

Yes they make money but how? They spend so much on making the movie, how do they get all that and more back?

Well, everyone of you may have such kind of question. Let us today discuss that, how the maths behind money making from movies work?

Well, a Movie is an Asset. It’s just like any other asset in the world such as stocks, bonds, gold, real estate or mutual funds. The Movie falls under the category of “Intellectual Property” also known as IP Assets. Intellect means mind and intellectual means mind work.

Here are the few examples of Intellectual property -

- Movies (Real and Animated Both)
- Sound / Music
- Novel
- Sketches
- Art
- Book
- Painting
- Articles
- Domain Names
- Business Plans…etc…

Now, all of you know that, movies make huge money on Box Office means during the first few weeks of its release in Cinema Halls. This is the period where Movie Producers get back their original money. But What if the movie is not successful?

Well, still than the movie owner makes money. Well, making a movie is one time hard work. Once you do this hard work, you have build a steady stream of the Passive Income. Yes, Passive Income. Every year the movie producers get a check of royalty that can be in crores.

Because every time, when a TV Channel shows a movie to its audience, that TV Channel has to pay royalty to the movie producer. Every time when people buy CDs or DVDs of that movie, the royalty comes in. It is different thing that the piracy has affected the over all revenues of this Income. But still it’s a huge source of steady and passive income.

The movies which were made and released in 1950s and 60s are still making lakhs and crores of rupees every year for its producers.

Famous Film Production Houses sometimes don’t focus on quality of the movie. They only focus on the quantity of the movie. Because every time they make a movie, this Asset will be added into their existing portfolio of the movies.

In Bollywood there are few movie makers who holds the movie portfolio of more than 100 Super Duper Hit movies…!!!!

The great part of making a movie or any other IP Asset is that, you have to work hard initially only. Once you make that movie (Asset), it will keep generating steady passive income for you and your future generations forever…!!!