DreamWorks had come close to bankruptcy twice.the studio suffered a $125 million loss on Sinbad: Legend of the Seven Seas, and also overestimated the DVD demand for Shrek 2.In 2005, out of their two large budget pictures, The Island bombed at the domestic box office, while War of the Worlds was produced as a joint effort with Paramount. They eventually ran out of money. DreamWorks scaled back, stopped plans to build a high-tech studio, sold its music division and got out of the distribution business. They eventually ran out of money and sold the company to Paramount pictures. The deal was valued at approximately $1.6 billion, an amount that included about $400 million in debt assumptions. it's a lot harder to start a studio than you guys think.
Of course, there's Pixar. but you need a SJ and a John Lassetter to create something like Pixar.
And then you have to convince millions of moviegoers NOT to watch high budget competition such as Dark Knight Rising, Transformers, Twilight, Spiderman, etc.
Then you need to have something Millions of people want to watch this is the hard part :)
And then you'll kill Hollywood.
Small studios don't need as high a return.
This is in many ways a Clayton Christensen (The Innovators Dilemma) opportunity.
Producing high quality movies as ultimately a question of people and skills. There are plenty of both that can't get work anywhere else.
I don't understand why I would have to convince people to not watch those movies? They are still being sold today and people are still watching non-hollywood movies.
If it becomes impossible to be profitable with big productions then hollywood will kill itself soon enough.
In terms of scale, Dreamworks was designed to compete directly with the majors. They focused on tentpole pictures produced at Big Six scale. Even with their substantial financial backing, this meant that a single flop could (and did) jeopardize their company. Corman's films, on the other hand, with their minuscule budgets needed only draw a fraction of the business of a Dreamworks release to make a profit and so very rarely (if ever) showed up as a "loss" on his books. Corman's films rarely hit it big, but because of their relative costs, they never had to. Modest returns were sufficient for him to draw profit margins astronomically beyond those of the majors.
In terms of intent, Dreamworks was set up primarily to produce and release the films of its founders, who tended to trade in prestige films, and their desire to produce only Oscar-level films tended to paralyze their production ability; excessively high standards ruined them. When they did get a film off the ground, they tended to bet too large (out of desperation) and lost as frequently as they won. The exact same thing happened to Coppola's Zoetrope when he let himself run amok on One From the Heart.
The lesson from Dreamworks (and Zoetrope) is to manage your risk. Never put yourself in a position where a single failed project can ruin you. Similarly, never produce a film that requires broad mass market success to avoid total financial failure.
>never produce a film that requires broad mass market success to avoid total financial failure.
You'll avoid financial disaster but you'll never "destroy" Hollywood with this mindset. Copolla and Roger Corman disrupted the movie industry but they did not "destroy" Hollywood.
You won't destroy Hollywood by creating a few new studios. But you might change it. That's really what people want to achieve.
Anyway, you've named some of the best high-budget movies over the last 10 years. They don't release an Avatar every month.
In total, producing our studio's first 75 films would cost $5 million dollars LESS than the total production cost of just one of this weekend's wide release films (in this case, Haywire, made for $23 million). Go see Haywire, and think to yourself about a) whether that movie really needed to cost what it did (bear in mind that the majority of its costs were sunk into the logistics of shooting abroad in multiple Euro locations and filling out its secondary cast with A-list talent; were the locations and secondary cast essential?) and b) whether or not you might have been more interested in the film had it been produced w/o studio constraints (meaning more nudity and explicit violence; a "hard R" or NC-17 as opposed to the film's "soft R" rating).