This is actually a more general issue. Profit/loss is wrt an entity. A given entity's profit/loss says nothing about the profit/loss of related entities.
For example, many "non-profits" have associated entities that are very profitable.
That is true indeed. But I think the article makes some points that give us a different picture on the profitability of the movie industry. I always thought why not many good movies are shot per year if they are so profitable, I think it's because the returns on a movie are not that great after all.
Most blockbusters make money. They simply record the income in a different entity (or entities) than the entity (or entities) which recorded the expenses.
A large part of not getting screwed in a Hollywood contract is making sure your percentage relates the right entity.
"For the cost of “Men in Black 3,” for instance, the studio could have become one of the world’s largest venture-capital funds, thereby owning a piece of hundreds of promising start-ups."
That assumes you know how to do that of course. People know and are comfortable with what they know. Drawing a comparison to a skill in another industry that takes years to hone really makes no sense.
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[ 6.1 ms ] story [ 24.1 ms ] threadExample: According to this, "Return of the Jedi" did not turn a profit.
http://www.techdirt.com/articles/20110912/13500315912/hollyw...
For example, many "non-profits" have associated entities that are very profitable.
[0]http://www.amazon.com/The-Hollywood-Economist-Financial-Real...
A large part of not getting screwed in a Hollywood contract is making sure your percentage relates the right entity.
That assumes you know how to do that of course. People know and are comfortable with what they know. Drawing a comparison to a skill in another industry that takes years to hone really makes no sense.