Questions :
http://www.skillset.org/film/business/
Who finances the development of a film ?
When turning the script into a film, it takes time and money. To get funding, the producer and sometimes the director go to potential funders and then 'pitches' the project to them. When and if funded, this money is called the development funding and uses strictly for the film. However the producer can invest in the development of the film herself, and if this is done this means that she will retain all the rights to the resulting package to herself.
How does a film recoup the production finance ?
when planning, a recoupment plan is made. This is an estimate of how the film will make money. It lists the estimates of revenue from all likely sources like cinema, Dvd's, broadcasts and merchandise. It will also have a list of the stars and the crew to make sure whoever needs to be paid gets paid.
Films that do well in the box office make a profit. Even if the film is a hit and makes a good amount of profit, after deducting funds for the exhibitor and the distributor, monies will then be made by how much the film sales by DVD's sales and broadcasts ! The length of time it eventually takes to sell the film in all the available windows means that it may take several years before all the investors receive their money. And even longer before the producer can get paid.
What is meant by distribution ?
Distribution companies are vital for the film to reach its audience. The ask for the right to distribute the film to exhibitors ( cinema owners ), retailers, rental companies and broadcasters. They will take a percentage of the resulting revenue.
