The document discusses key aspects of film production, distribution, and marketing from an institutional and audience perspective. It covers: - The major issues in contemporary media ownership and practice, including the influence of major studios like Disney and Warner Bros. - The importance of cross-media convergence and synergies in production, distribution, and marketing across different platforms. - The technologies introduced in recent years that have impacted production, distribution, marketing and audiences, such as streaming services, home cinema, and digital cameras. - How proliferation of technology and content affects both institutions and audiences. - The significance of technological convergence for institutions and audiences in accessing content.

1. RevisionGuide: Institutionsand Audiences
AS Media Studies
Areas for focus:
Candidates should be prepared to understand and discuss the processes of production, distribution, marketing
and exchange as they relate to contemporary media institutions, as well as the nature of audience consumption
and the relationships between audiences and institutions. In addition, candidates should be familiar with:
 the issuesraisedbymediaownershipincontemporarymediapractice;
(Theimportance/influenceof the‘big six’: Disney,Paramount,Warner,Universal,Columbia and 20th
C.Fox.)
 the importance of cross mediaconvergence andsynergyinproduction,distributionandmarketing;
(Internet,newspapers,radio,television,billboard posters,SocialMedia (Facebook/Twitter) etc.)
 the technologiesthathave beenintroducedinrecentyearsat the levelsof production,distribution,marketing
and exchange;
(Such thingsasNetflix,Love Film, 3D, homecinema,Digital camera/projector.)
 the significance of proliferationinhardware andcontentforinstitutionsandaudiences;
(e.g.3D, Digital Camera/projector,homecinema,SmartTVs,Laptops,Tablets,the effectof Piracy etc .)
 the importance of technological convergence forinstitutionsandaudiences;
(Internet, Netflix,LoveFilm, homecinema,SmartTVs,Laptops,Tabletsetc. , Social Media like Facebookand
Twitter.)
 the issuesraisedinthe targetingof national andlocal audiences(specifically,British) byinternational orglobal
institutions;
(Howare we targeted?Howmuch choice do we have?)
 the waysin whichthe candidates’ownexperiencesof mediaconsumptionillustratewiderpatternsandtrendsof
audience behaviour. (Where,When and How do you watch films?Whatdo you watch?How typical areyou?
Piracy?)
The Examination
 To be successful in theexam you must be ableto confidently discuss any of the seven key areas.
 You must make clear references to real examples of films,directors,studios,production companies,distributorsand
exhibitors.
 You will beexpected to show a good overall knowledge of the FilmIndustry.
The firstthree things you will need to know about are:
 Production
 Distribution
 Exhibition

2. Production
 The issuesraisedby media ownershipincontemporary media practice.
 The importance of cross mediaconvergence and synergyin production.
 The technologiesthathave beenintroducedin recentyears at the levelsofproduction.
 The significance ofproliferationinhardware and contentfor institutionsandaudiences.
 The importance of technological convergence forinstitutionsand audiences.
Production refers to the making of the film:
 Finding the idea
 Writing the script
 Pitching it to a studio
 Setting a budget
 Casting stars and employing a crew
 Filming
 Editing
Investors:
 For a film to go intoproduction it needs investors to provide the
necessary funding.
 Box office is success is never certainandsoinvestors try to reduce
the riskof losing their moneybybecoming involved in important
decisions
 Key questions that they will ask are:
 Is the film’s storyline similar to other films that have made
money recently?
 Does it offer easy selling points?
 Are there obvious marketing spin offs to give added publicity?
 Is the star popular?
 Had the director had previous successes?
Here’s the path a film usually takes to get to your local theatre:
 Someone has an idea for a film.
 Theycreate anoutline anduse it to promote interest inthe idea.
 A studioor independent investor decides to purchase rights to
the film.
 People are brought together to make the film (screenwriter,
producer, director, cast, crew).
 The film is completed and sent to the studio.
 The studio makes a licensing agreement with a distribution
company.
 If the filmhas beenfilmed incelluloid, the distribution company
determines how many copies (prints) of the film to make.
 The distribution company shows the film (screening) to
prospective buyers representing the cinemas.
 The buyers negotiate with the distribution company on which
films theywishto lease andthe terms of the lease agreement.
 The FilmDistributors are responsible for marketing andpublicity.
 The better the publicitythe more people see the film and the
more money that is made.
 The prints / digital downloads are sent to the cinemas a few days
before the opening day.
 The cinema shows the film for a specified number of weeks
(engagement).
 You buy a ticket and watch the movie.
 At the endof the engagement, the theatre sends the print back to
the distribution company and makes payment on the lease
agreement.
Production – Risks:
If the answer to anyof these questions is nothen changes will be made
to the “package” (the details ofthe film) to make sure all the answers
are yes! Otherwise the investors will take their money elsewhere.
The Big Studios
 In recent years the big studios – Sony, Paramount, 20th CenturyFox,
Warner Brothers andDisneyhave dramatically cut the number of
films they make (up to 50% less).
 At the same time they are increasing budgets to the $150-$200
million range.
 On the release of each filmtheywillspend at least $100 million to
promote a blockbuster around the world.
 Onlyhalf ofbox-office goes to the Film Studios (rest to cinema
owners).
 Therefore a total budget of$250 million has to have a box office
above $500 million to make a profit.
 In 2013 there are a large number of blockbusters (19) which is far
more than ever before.
 In the past a maximum of nine blockbusters have done well in any
one year.
 Whymake Blockbusters? Because it still makes financial sense for
the Film Studios.
 The top ten most successful films are blockbuste rs.
 “Man of Steel” cost $225 million. First twoweeks box office = $400
million.
 “Fast and Furious” cost $160 million. Box office =$666 million.
Hopeful signs:
 The big studios have made upfor the dramatic loss in revenue
from DVD sales (used to be half their profits) by boosting box
office outside America.
 In the past international box office sales were 50%. Nowit is 70%
(2013).

3. Blockbuster Strategy:
 So sure are film studios oftheir Blockbuster policythat
theyare mapping release schedules for five years ahead.
 Robert DowneyJr has just signedto make twomore
“Avengers” films with Disney(release May2015).
 Sony/Columbiahas announcedit willrelease “Spider
Man” films may‘14, June ‘16 andMay‘18.
The Risks of Blockbuster!
Steven Spielberg said in July 2013:
 “There is going to be an implosion where three or four
mega-budgeted films are going to go crashing to the
ground.”
The effects of blockbuster failure:
George Lucas (creator of “Star Wars”) says :
 “It’s a mess. It’s total chaos. Infuture there will be fewer
but bigger cinemas anda revolutioninpricing. Tickets
maycost $50 -$100.
 Going to the cinema willbecome anevent / experience.
The film will be secondary.
 Steven Soderbergh has announced he will make nomore
films for the big screen. He is tiredof the studios’
blockbuster strategyandthe fact audiences lap it up.
The problems with film production:
Paul Webster (Producer of “Atonement” and “Anna Karenina”) says:
 “It is as hard as it has ever beento get serious stuff of the ground. This is
mainlybecause films have become events andturned into a spectacle. Big
blockbusters are like stadium bands playingbig arenas. If you are trying to
do interesting things you are forced to ever smaller venues.”
 He believes television is where the most interestingstuffis beingmade. He
cites “Homeland”, “The Wire” and “Broadchurch” to back up his view.
 Mike Figgis (Director) has been Oscar-nominated and his films include:
“Stormy Mondays”, “Internal Affairs” and “Leaving Las Vegas”.
 He is annoyed that the British Film Industry is ‘defeatist’ in attitude and
outdated in structure.
 He claims it does not help young British film makers. He says:
 “Film-makers cannot flourishandgrowunless you give them room to do
so.”
 “Creativity cannot exist in a system of committees”
 Figgis believes we are nowproducingunoriginal films. The films made are
either depressing working classcouncil estate films or historical costume
dramas.
Figgis fears:
 Without a big star name it is impossible to get finance.
 The Britishfilm industry will not fully embrace the digital revolution –
particularly with regard to distribution.
 Our brightest and best film makers are forced to go to America.
International markets - China
 China and other developing countries provide an ever increasingproportion
of film revenues – International markets = 70% of cinema box office.
 Film Production Companies are increasing aware that theyneedto produce
films that will appeal to market.
 For 80 years Grauman’s Chinese Theatre on HollywoodBoulevardhas been
one of America’s greatest tourist attractions.
 The biggest movie stars put their hand and footprints into wet cement.
 It is symbolic that a Chinese televisionmanufacturer has bought the rights
$5million.
 The Chinese are investing far more in American Cinema.
 September ‘12 the Dalian Wanda Group bought ACM Entertainment –
America’s second largest cinema chain for $2.6 million.
 In 2012 China overtook Japan to become biggest movie market after
America.
 In 2012 box-office revenues shot up by 36% to $2.7 million.
 2000 cinema screens built Jan-March ‘12 alone.
 By 2020 China will be biggest film market in world.
 Film Producers are tryingto satisfy Chinese consumers and pacify their
government which regulates the number of foreignfilms released (currently
34).
 American film producers release substantially different versions of their
films in China.
 American film Producers are changing the content and tone of the films
they produce.
 For Producers it is the non-American (especially Chinese) teenager who
counts now.
Chinese Market – Task:
Different scenesandcharacters are addedinespeciallyfor the Chinese market.
Researchsome examples (e.g. IronMan3). Some films plots have even been re-
worked to avoid upsetting Chinese investors and audiences!
Low-budget films:
 KatherineButler is theHeadofFilm4’s Low BudgetFeature
Department since2009.
 Film 4’s LowBudgetDepartment has turned outaward winning
titles including “Tyrannosaur”, “Dreams ofa Life”, “Kill List” “The
Deep BlueSea” and“Berberian Sound Studio”.
 “The Guardian”said, “Thesefilms stand for a boldnewwave of
British film making: cinematically confident, generically ‘tricksy’,
compelledby disturbing, ambivalentsubject matter.”
 Butler said, “In 2009I saw several micro-budgetfilms that were
already pushing boundaries with strong directorial voices. Every
year sincethen twoor threereally strong, selffinancedpieces
come throughbecausetechnology is enabling that tohappen.”
 KatherineButler maintains, “The job for places likeFilm 4 and
the BFI is to nurture peoplecoming throughthis route (micro-
budget films) and to help enable film makers whohave already
found their voiceto continueto work with the most freedom in
an industry that is a business as wellas a place ofartistic
endeavour.”
 “What counts as a low-budgetfor Film 4 –less than£2million –
can still marka massiveincrease for a previously self-financed
film maker,without introducing thekind ofpressurethattends
to stifle experimentation.”
 KatherineButler says,“Low-budgetis a very riskfriendly
environment. It is an engineroomfor innovation. Wewantto
work with directors againand again.Providing a home for new
directors is very exciting.”
 She maintains, “There arealways films like “Tyrannosaur” and
“Kill List” whichdon’t dothehighestbox officebut areso
acclaimed they becomestepping stones for their directors and
have a long life.”
 Finally,shesays: “It is the upand coming directors who get me
excited. Thesefilmmakers areso confident inthewaythey take
genre on, whetherit’s comedy,thriller, horror or documentary.
They are pushing atboundaries, evolving recognisableforms of
cinema intosomething their own...”


4. Distribution and Marketing
 The importance of cross-mediaconvergence and synergyin distributionand marketing.
 The issuesraisedby media ownershipinmedia practice.
 The technologiesthathave beenintroducedin recentyears at the levelsofdistributionand marketing.
 The issuesraisedin the targetingof national and local audiences(specifically,British) byinternational or
global institutions.
Standard Release:
 Films are released in “release windows". This keeps different instances of a movie from competing with each other.
 In the standard release, a film is first released in the cinema (theatrical window),
 After approximately 16 and a half weeks, it is released to DVD (video window).
 After an additional number of months it is released to Pay TV and On Demand services .
Simultaneous release:
 A simultaneous release takes place whena filmis made available onmanymedia (cinema, DVD, internet) at the same time or wi th very little
difference in timing.
 What are the pros and cons of a simultaneous release?
 Consumers have more choice
 Producers only need one marketing campaign
Straight-to-video release:
 A straight to video (DVD/BluRay) release occurs whena movie is released on home video formats without being released in cinemas first.
 STV releases used to be seen as a sign of poor quality
 Have become a more profitable option in recent years. Especially for independent moviemakers and companies.
 Research Task
 Find out all you can about the first ever “Tesco Films” release.
 Makers of smaller-budget movies are also putting to the test new release strategies.
 Films are premiered on VOD (Video On Demand – Pay Per View) systems and received a limited theatrical release one month later.
 Some major studios have consideredmaking movies available to VOD services shortly after their theatrical release for a premium price.
 Find out all you can about films that have been released in this way.
Shrinking the theatrical window:
 Originally a six months duration
 Todaybeenreduced to little more than four months.
 Movie studios have reportedlybeenpushingto shrink the
durationof the theatrical window.
 Cinema owners have fought fiercelyagainst this.
Why do you think studios are in favour but cinema chains are
against shrinking the theatrical window?
Distribution:
 In startingto plana marketingcampaign, the film distributor has to decide
how it will present a film to a potential audience.
 Theyneedto decide what sets this filmapart from all the other films that are
released – they look for a film’s ‘unique selling point’ (USP).
 If, for example, the distributor is handlinganadventure film, they will need
to look for aspects of the film which set it aside from the other action
adventure films.
 After this theywilllook at suchthings as whostars inthe film, are there new
and spectacular special effects in the film and who is the director?
 Taking all ofthese intoconsideration, the distributor will then decide which
elements to stressinthe marketing campaign(posters, trailers, etc.) i.e. how
to position the film in the market place.
 From the informationyou are given couldyou saywhat you think is the USP
of three new films of your choice?
 Go on imdbandfind a print of hand out that goes with those withthree films.
Distribution - Marketing
 Marketingis one of the most important aspects of a
film’s distributionandthere are manydifferent ways to
market a film.
List of the different the ways you can market a film.
 Posters
 Trailers
 Online and mobile content
 Special Screenings/Premieres
 Interviews/ articles
 Merchandising
 Festivals/ Awards
Distribution – Marketing Task:
 www.launchingfilms.com/releaseschedule
 Choose a film that haseither beenreleasedthisweek or is just about to be
released.
 Create a PowerPoint presentation that covers as muchabout the marketing
strategy for that film as possible
 Make a note of whether your chosen film is British or America
 Record the name of the distribution company

5. Movie marketing is also known as movie advertising and movie
promotion.
 Distribution is concerned with ’getting the film out there’.
 Publicityand Marketing are key features of the distribution
process.
 Every major Hollywoodstudioand movie distributioncompany
has an internal department devoted to promotion.
 The promotions department is responsible for designing and
implementing an effective, cohesive advertising campaign
across several different media platforms. These include:
theatrical movie trailers, newspapers, magazines, television,
radio, the Internet and billboards.
Different Strategies - the issues raised in the targeting of national
and local audiences (specifically, British) by international or global
institutions.
 Every movie is different.
 The promotions department must figure out what type of
campaignwill be the most effective at reaching the target
audience.
 This requires researching the tastes and media -consuming
trends of the target audience.
 Basedon this research, the movie marketers decide howmuch
of their budget to spend on each different media outlet.
 The theatricaltrailer is often the first chance to promote a
movie to its target audience.
 Starting up to a year before the release of a major studio
movie, distributors run movie trailers that are meticulously
edited and audience-tested.
 The ideais to give moviegoers a taste of the laughs, special
effects andplot twists ofthe studio's upcoming releases, while
leaving them wanting more.
 It's an art form that's usually handled by special trailer
production houses
Cross-media convergence - the importance of cross media convergence
and synergy in production, distribution and marketing.
 Publicists handle all interviewrequests for the stars of the film – form
newspapers, magazines, TV Talk Shows etc.
 To protect the client from any surprises, publicists will ask the
journalist exactlywhat the story is about and what questions s/he
plans to ask.
 In some cases, the publicist will askto be present at the interview to
make sure that the client doesn't comment onsensitive issuesor make
remarks that could look bad in the papers.
 As the release date of the film draws closer, movie marketers tryto get
earlyfavourable press coverage in newspapers, magazines and on
entertainment TV shows.
 The mainmovie publicity tactic is something called a press junket.
 At a press junket, journalists, entertainment reporters and movie critics
are flownout to a special locationfor a dayor weekend of interviews
with the stars and creators of the film. The actors, directors and
screenwriters sit in separate rooms andthe reporters are brought in
one by one to ask their questions.
 Press junkets are highlycontrolledenvironments where interviews are
often attended bya publicist, who make sure interviews never veer
from positive topics.
 If you've ever seena TV interview with an actor sitting in front of a
poster of their movie, that's from a press junket.
 More than ever, publicists network withonline bloggers and read and
respond to comments on popular social networks.
 In additionto a standard press tour, they might arrange for a live,
online Q&A session witha popular fansite or interviews withpodcasts.
 About the same time that the first trailers hit the theatres, the Film
Studio will unveil an official Web site for the film.
 Typical movie Websitesallowvisitors to:viewmultiple versions of the
trailer, watchbehind-the-scenes interviews and mini-documentaries,
read plot synopses, download cell -phone ringtones and desktop
wallpaper, playgames, chat inforums andevenpre-order tickets. The
official movie Website is onlythe beginning of a muchlarger Internet
marketing campaign.
 Look up the website for “Iron Man 3” and 4.
 Weeks before the filmopens nationwide, the promotions department
starts an all-out publicity blitz.
 The idea is to bombardthe public withso manyimages and promos for
the film that it becomes a "can't miss" event.
 Film marketers will plaster the sides of buses with huge ads, place
billboards all aroundthe city, run tons ofteaser trailers on TV, place
full-page ads inmajor newspapers and magazines, and the movie's
stars will show up on all of the major talk shows.
 The Internet is proving to be a prime spot for publicity blitzes.
 Promoters canplace interactive ads on the Websites most trafficked
by their target audience.
 Theycan also release behind-the-scenes clips, bloopers and other viral
videos on video-sharing sites like YouTube.
 Or theycan release different media clips and let the fans create their
own trailers.
 Another popular strategyis to use highly visible product tie -ins and
corporate partnerships.
 In the weeks leading up to the release of "How the Grinch Stole
Christmas," images of the green Grinch appeared on packages of
Oreos, boxes of Froot Loops and cans of Sprite.
 Even the UnitedStates Postal Service got into the act, stamping letters
with special "Happy Who-lidays!" messages.
 For marketingchildren's movies, the HolyGrail for publicists is getting
promotional gifts in McDonald's Happy Meals.
Big Brand Marketing - the issues raised by media ownership in
contemporary media practice.
 Brand andfilm partnership marketing seems more integrated
than ever before.
 In manycases, brands are taking onthe personalities of the
movies, actuallyenacting the ethos of the films in their
marketing and product experiences.
 At the same time, brands are being woveninto scripts as vital
characters of their own
 Read the articlesinthe revisionpack for more information!
Publicity Stunts
 One final movie marketingstrategyis the publicity stunt, an
orchestratedmedia event where someone does something
incrediblysilly, dangerous or spectacular to draw further
attentionto the opening of the film.
 An example is when the promoters of "The Simpsons Movie"
transformeddozens of nationwide 7-Elevenconvenience
stores intoreplicasof Springfield's ownKwik-EMart.
Activity:
Spendsome time looking online for other famous examples of
publicitystunts – payclose attention to the type of publicity they
attracted (positive/negative, local/global)

6. Exhibition
 The technologies that have been introduced in recent years at the levels of exchange;
 The significance of proliferation in hardware and content for institutions and audiences;
 The importance of technological convergence for institutions and audiences;
 The issues raised in the targeting of national and local audiences (specifically, British) by international or global
institutions;
 The ways in which the candidates’ own experiences of media consumption illustrate wider patterns and trends of
audience behaviour.
The Film Value Chain
 Of the “Film Value Chain” where do you think that films
make the most money? Why do you think this is?
Cinema: the first and the best way!
There are several different types cinema:
 Multiplex
 Imax
 Art-house
Cinema Chains:
 Odeon
 VUE
 Everyman
 Curzon
 Empire
 Cineworld
Activity:
 How does the range of “cinematic experiences” offered
vary between the Odeon/VUE and Curzon/Everyman
chains?
 Do all cinemas withinthe same chain showthe same films?
If not why not?
 Do you thinkall these cinema chains attract the same type
of audience? Why?
Exhibition
 When we refer to “film exhibition” we are talking about how the pubic
actually watches the film.
 The cinema release of a film marks the final stage of one part of a film’s
journeyfrom ideato audience. It also marks the beginning of a new journey
from cinema to small screen.
 After its cinema release the film will then be availableon payTV, free to air
TV, as well as television.
 Each of these “exhibitions” ofthe film offers the possibility of generating
profits for both the film’s distributor and producers.
Exhibition Activity
 Make a list of the pros andcons of each for of exhibition (watchinga film) –
try to decide which wayis the best.
 The options are: cinema, television(VOD), DVD, Online – either througha
PC/laptop or mobile phone.
Changes in exhibition
Box office gross – UK (2012-2013)
Visit VXF’s ‘A Level Media Studies’ blog for extra articles
and information to help you revise for the exam:
http://vxfmediastudies.blogspot.co.uk

7. Areas of examination
It is important for you understand the specific areas of ‘Institutions and Audiences’ that the exam board might target. They
may ask a general question about production, distribution or exhibition, but they may be looking for something more specific,
such as the impact of digital media technology on the film industry.
Here are some ofthe past exam questions for the Section B:Industries andAudiencessectionof you exam:
 Discuss the ways in whichmediaproducts are produced and distributedto audiences, withina media area whichyou have studied. (Jan2009)
 How important is technologicalconvergence for institutions andaudiences withina media area you have studied? (Jun 2009)
 “Media production is dominatedbyglobal institutions, whichsell their products andservicesto national audiences.” To what extent doyou
agree withthisstatement? (Jan2010)
 What significance doesthe continuing development of digital media technologyhave for media institutions andaudiences?(Jun2010)
 Discuss the issuesraisedbymediaownership inthe productionandexchange of media texts inyour chosen media area. (Jan2011)
 “Successful media products dependas muchuponmarketing and distributionto a specific audience as theydo upon goodproduction
practices.” To what extent wouldyou agree with thisstatement, within the media area you have studied? (Jun 2011)
 To what extent does digital distributionaffect the marketing andconsumptionof media products in the media area you have studied? (Jan
2012)
 “Cross-mediaconvergence andsynergyare vital processes inthe successful marketing ofmedia products to audiences.” To what extent doyou
agree withthisstatement inrelationto your chosen media area? (Jun2012)
 What impact does media ownershiphave uponthe range of products available to audiences inthe mediaarea you have studied?(Jan 2013)
Sample Question
Discuss theissues raised by an institution’s need to target specific audiences
within a media industry which you havestudied. (50 marks)
Discuss two case studies –1 Hollywood Block Buster, 1 Independent film
Cover the following areas:
 Production practices that allowtexts tobe constructed for specific
audiences.
 Distributionandmarketing strategies toraiseaudienceawareness of
specificproducts.
 The use of new technologyto facilitatemoreaccurate targeting of
specificaudiences
 Audience strategies in facilitating or challenging institutional practices.
 What kind of challenges do independent films present in terms of
marketing?
 Difficult to marketfilm
 Hard to reachaudience
 Low budget –can’taffordlarge advertising campaign(posters, TV
slots etc)
 Effective Marketing Strategies for low-budget films:
• Different marketing for UK and USA
• Conventional website
• Innovative website –e.g. interactive online games
• Appeals to hard to reach audience
• Use of iPads
• Make use of publicity from film festivals
• Effective audience interaction –enables audience to personally
relate to the themes ofthe film
 Blockbustermarketing:
 Advertising, competitions, trailers,specialscreenings/premiers,
merchandising,awards, interviews/articles,online content, social
media reach.
Other areas:
How important istechnological convergence?
 What is technologicalconvergence?
For the purposes ofthis essay I am definingtechnological convergence as..
 Discuss the impact oftechnologicalconvergenceon the way independent
films were publicised and distributed, e.g. Dreams ofa Life
 Discuss the impact oftechnologicalconvergenceon blockbusters such as
The Hunger Games and Iron Man 3
Discussthe waysmediaproductsare produced and distributed within an area
you have studied.
Production:
 What problems/advantages do small independent film makers have
getting films made? Be specific –WARP (use examples).
 What advantages do the ‘big six’ major studios have?
 What effect does the power ofthe ‘big six’ have?
Marketing:
 What marketing strategies did small independent films use to attract
attentionandpublicise their films with a limited budget? NB: Cross Media
Convergence.
 In contrast,what marketing strategies did blockbusters use with their
much larger budget?
Exhibition:
 What strategies dothefilmmakers/Distributors useto getthefilms to
you?
 How exactly canyou watch the films?
Cinema? Mainstream or Independent? Curzon onDemand? DVD? Sky?
Smart TV? Netflix?

8. The Film Industry Today
Is the Hollywood blockbuster model broken?
 It mayhave lacked a generation-defining event movie like 1977's
Star Wars,or even a technological ground breaker like 2009's
Avatar, but 2013 was still the year of the Hollywood blockbuster.
 This year, 26 films costing more than $100m (£61m) each were
released bythe major Hollywood studios - more than ever before.
Theyare likely to have raked in tens of billions of dollars in
worldwide box office revenues as a result - close to the record
$35bn (£21.5bn) delivered in 2012.
 Some of the films did badly. The Lone Ranger, starring Johnny
Depp, barelymade back the $250m it cost to make. But the hits
outweighed the flops: Iron Man 3 took $1.2bn in box office
receipts aroundthe world, toppingthe charts and making it the
fifth highest-grossing film of all time.
 But despite the runaway successes, there are concerns within
Tinseltown that blockbuster budgets are gettingdangerouslyhigh.
Bankrupted
 "There's eventually going to be an implosion, or a big meltdown,"said
Hollywood elder statesman Steven Spielberg in a speech earlier this
year. "Three or four or maybe even a halfdozen mega-budget movies
are going to go crashing into the ground, and that's going to change
the paradigm."
 It has happened before. In 1980, Heaven's Gate effectively
bankrupted United Artists. The budget for the sprawling Western got
out of control, the film bombed, and the studio was forced into a
takeover by MGM.
 Hollywood watchers say it's a statistical certainty that another bomb
to rival Heaven's Gate, or even 1995's Waterworld, is around the
corner. But the difference, they say, is that modern Hollywood studios
are equipped to cope.
 After a wave of acquisitions in the 80s and 90s, the six "majors"that
dominate global box office are now parts of massive media
conglomerates. They have found ways to both boost profitability of
their films and mitigate the risks associated with making such huge
investments.
 The first thing the studios have done is spread the risk by getting
dozens of smaller production companies to invest alongside them,
reducing their exposure to a potential flop.
Revenue streams:
 The second thing is that they have made the success of their films
almost a sure thing.
 Recent research by British film academics John Sedgwick and Mike
Pokorny has found that not only have blockbuster films become more
profitable over the past 20 years, they have become more reliably
profitable: in the late 80s just 50% of major studio films turned a
profit. In 2009 it was 90%. Flops have become rare.
 "[Studios] are ruthlessly good at getting returns from their
investments," Prof Sedgwick says. "Hollywood has got better and
better at it. The more you spend, the more you get back. It seems to
me to be an extraordinarily successful model."
How have the studios achieved this?
 The first step has been to generate new revenue streams. In the early
days ofHollywood, 100% ofrevenues came from ticket sales. Now it's
just 20%. The rest ofthe money comes from television licensing, DVD
sales, merchandising and other commercial deals.
 "Blockbuster films are not really films," says Charles Acland, a
professor of communication studies at Concordia University in
Montreal, and author ofthe book Screen Traffic. "They are in fact very
elaborate 'tent-pole' business models that connect all sorts of
different commodities in all sorts ofdifferent industries."
 The second step has been to look beyond the domestic US market,
where cinema audiences aren't really growing, and look overseas to
developing markets such as China.
The history of the blockbuster
 The ironyis that Spielberg almost singlehandedly invented the
blockbuster genre.
 When his filmJaws was releasedin 1975, Hollywood realised that
making a few big-budget films a year that appealedto the masses
was more lucrative thanmaking dozens of smaller ones, and a
business modelwas born. Since then budgets have soared and
artistic merit has taken a back seat.
HIGHEST-GROSSING FILMS OF 2013 WORLDWIDE
 Iron Man 3 (Walt Disney) - $1.2bn
 Despicable Me 2 (Universal) - $919m
 Fast & Furious 6 (Universal) - $789m
 Monsters University (Walt Disney) - $744m
 The Hunger Games: Catching Fire (Lionsgate) - $730m
 Man of Steel (Warner Brothers) - $663m
 Gravity (Warner Brothers) - $642m
 Thor: The Dark World (Walt Disney) - $620m
 The Croods (20th Century Fox) - $587m
 World War Z (Paramount) - $540m
 Source: Box Office Mojo
Communal experience
 A look at this year's top10 highest-grossing films reveals just two
originalscreenplays - animationThe Croods and3D epic Gravity. In
both 2012 and 2011 there were none in the top 10.
 As a mark of the power of the franchise, The Amazing Spider-Man
was releasedlast year, andSonyhas alreadypencilledin dates for
The Amazing Spider-Man 2, 3 and 4 stretching until May 2018.
 That's on topof Spider-Man1, 2 and 3 releasedbetween2002 and
2007.
 "If you want a shared communal experience of the film that
everybody's talking about right now, then you go to the movie
theatre," Prof Acland says. "The blockbuster is very stable in
Hollywood. It's not going to go away any time soon."
The Future
 Hollywood faces challenges. Executives are sweating over a virtual
collapse in DVD sales in recent years amid the growth of online
streaming services such as Netflix. The major conglomerates that
control the studios are seeing profits faster at their television arms
than in the film industry, and are cutting costs.
 But perhaps the more worrying long-term problem is what Charles
Acland calls "aesthetic bankruptcy". The blockbuster business model
necessarily leads to making bad movies.
 The perception that Hollywood peddles lowestcommon denominator
crowd-pleasers at the expense of "serious" cinema means
screenwriting talent is increasingly moving over to television. This
year director Steven Soderbergh threatened to quit altogether.
 But while blockbuster franchises continue to bring in billions
worldwide, there is little sign that Hollywood will change its ways.