Why are box office numbers made public?

Question

Why are all 'box office sales' made public? Is it a customary thing? A marketing ploy? Do they have a similar thing for TV (beyond ratings)? I only see profits for video games listed for publicly held companies. This has been annoying me recently for some reason.

It seems quite plausible to me the official 'box office' movies are only those supported by a few big companies in the industry and have a 'captive' audience in that there is one private company serving these 'official box office' records and if you aren't part of the club you are ignored. It appears most don't release information about post box office profit, like licensing or merchandising... so why the box office numbers.

Does anyone have any insight into this? Normally there is no good reason (and lots of bad ones) to share your business financial details with anyone unless required.

Answer 1

I have worked in the film distribution industry for the past 15 years and handle box office numbers on a daily basis.

There are companies that track the box office ticket sales by cinema, on behalf of the distributors (studios and independents). The market leader right now is Rentrak which serves the majority of the markets around the world, but there are other companies too, usually in smaller countries/regions (e.g. MaccsBox in Holland).

The distributors get their grosses daily (or hourly/live in advanced markets), check them and then publish them to the "trades" (Variety, Deadline, Hollywood Reporter, Box Office Mojo etc). These numbers get published to attract publicity for the film, cast and studio. Many times these box office grosses are not even actuals, but estimated totals for a set period of time. For example if you visit the Variety website or Box Office Mojo on a Sunday, you will see the expected grosses for the whole weekend, including estimates for that Sunday night.

By the way, these numbers are public because the studios/cinemas agree to make them public. There are countries where some distributors do not disclose their results (e.g. Israel). Rentrak and the other data collection companies can only disclose what they have been allowed to disclose. Variety, Deadline Hollywood, Hollywood Reporter, Box Office Mojo etc only disclose the data they have been given by the studios/distributors.

It's interesting to note that the box office total is not really what a studio gets from a film. The studio's true revenue is a percentage of the total gross box office, typically less than 50%. The true revenue by film is never discussed publicly. It's even illegal in many markets for distributors to exchange that kind of information.

Ticket inflation ensures that we will keep breaking records and claim impressive headlines in the trades. Some markets, like France, only disclose admissions (number of tickets sold) not the box office gross. Cynics in the industry suggest that we should all be using admissions instead of box office, to truly track performance. But then, who will even be able to beat Gone with the Wind? :)

Answer 2

Well one clear reason for making box-office numbers public is marketing. Good numbers help a lot in building the brand name of production studios. If one movie from a particular studio makes huge profits, the trailer for their next movie will open with the lines "from the creators of ..." or "from the studio which brought you ...".

Any movie's success is based on 3 important parameters:

1. critical acclaim
2. awards won by it, and
3. box-office revenues it collected

Good Box-office numbers are extremely important for a studio' brand name.

Who would want to work with a studio whose movies bomb at box-office and Who would not want to work with a studio whose movies are record-breakers?

It also helps a movie that is stil running in theatres. When people see that such and such movie has made millions in 2 weeks, it would definitely attaract them to the theatres. More so in case of international releases where release dates are different.

Answer 3

TL; DR:

The numbers are made public because they are public - they're available to anyone who is willing to pay a commercial fee.

There are plenty of reasons why people want to know this, such as for marketing purposes and knowing what films to broadcast and when.

Long Answer:

For a start, your question seems to be making an inaccurate assumption. You say say that normally it is bad practice to share your financial details, unless you have to: but in the case of the box office, these companies aren't sharing financial details - other companies are.

When we hear how well a particular movie has done on its opening weekend, that information isn't coming from the film's creators or distributors. It's coming from box office tracking companies. This makes complete sense. After all, you don't pay Warner Bros directly to see one of their films. You pay them indirectly, giving your money instead to a cinema, or a broadcaster, or a shop, or something similar.

In terms of box office opening weekends, for example, it will be to a cinema. There are then companies, such as Box Office Mojo and Cinema UK, who gather this information by tracking tickets sales. They then release this information, on a commercial basis, to both the film makers (who then learn how well they've done) and to any other party who is interested. Thus, the original companies aren't releasing this information. It's the data analysis companies that are.

This is the exact same case for things like the Official Charts Company in the UK, which aggregates all music sales each week. It simply looks at all downloads, purchases etc that have been made. This is independent of the music labels.

So I would argue that answers the biggest part of your question - the numbers are made public because they are publicly available.

However, there are definitely other reasons why this information has become so popular:

1. Much like how critic reviews are important to many cinema goers to determine if they will like a film, some fans like to know a film's box office showing. If a film is performing poorly, that will put some off. Likewise, if a film has been out for a few weeks and is still riding high, is is arguably more appealing.

2. It provides great marketing for films. Film studios can use this information to really publicise their film ("other people loved this, so will you!"). As @Ankit comments, they can also use this in future advertising deals.

3. It allows cinema chains to track how popular films are. If evidence is growing that a film's popularity is decreasing, a decision may be made to remove the film nationwide, or keep it in only certain locations. If evidence shows that a particular film is very popular at a certain time of day, a cinema could use this information and change its own scheduling of said film to the more preferable time.