Film financing is a part of the filmmaking process that takes place prior to pre-production and is focused on determining the potential worth of a project. In the United States, the value is often based on a revenue prediction, commencing with theatrical release and incorporating DVD sales, as well as distribution to local and international cable broadcast television networks and in-flight airline licenses.
Film finance is a subset of project finance in which the cash flows generated by the film project are used to repay investors rather than external sources. Public taste, aesthetic merit, competition from other films released at the same time, script quality, cast quality, director quality, and other criteria, among others, all play a role in deciding a film’s commercial success.
Several countries implement initiatives to subsidize the cost of film production. The UK Film Council, for example, gave National Lottery funds to producers until it was terminated in March 2011, as long as certain terms were met. The British Film Institute now handles many of the Council’s responsibilities. Georgia, Ohio, Louisiana, New York, Connecticut, Oklahoma, Pennsylvania, Utah, and New Mexico, for example, will grant a subsidy or tax credit if all or part of a film is shot in their state.
Pre-sales is the process of selling the rights to release a film in multiple areas before it is finished, based on the plot and cast. When an agreement is struck, the distributor will demand that the producers deliver particular content and cast aspects; if a significant change is made, financing may be jeopardized.
Pre-sales is the process of selling the rights to release a film in multiple areas before it is finished, based on the plot and cast. When an agreement is struck, the distributor will demand that the producers deliver particular content and cast aspects; if a significant change is made, financing may be jeopardized.
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