Originally, all films were made to be shown in movie theaters.
The development of television has allowed films to be broadcast
to larger audiences, usually after the film is no longer being
shown in theaters. Recording technology has also enabled consumers
to rent or buy copies of films on video tape or DVD (and the older
formats of laserdisc, VCD and SelectaVision — see also videodisc),
and Internet downloads may be available and have started to become
revenue sources for the film companies. Some films are now made
specifically for these other venues, being released as made-for-TV
movies or direct-to-video movies. These are often considered to
be of inferior quality compared to theatrical releases. And indeed,
some films that are rejected by their own studios upon completion
are dumped into these markets.
The movie theater pays an average of about
55% of its ticket sales to the movie studio, as film rental
fees. The actual percentage starts with a number higher than
that, and decreases as the duration of a film's showing continues,
as an incentive to theaters to keep movies in the theater longer.
However, today's barrage of highly marketed movies ensures that
most movies are shown in first-run theaters for less than 8
weeks. There are a few movies every year that defy this rule,
often limited-release movies that start in only a few theaters
and actually grow their theater count through good word-of-mouth
and reviews. According to a 2000 study by ABN AMRO, about 26%
of Hollywood movie studios' worldwide income came from box office
ticket sales; 46% came from VHS and DVD sales to consumers;
and 28% came from television (broadcast, cable, and pay-per-view).
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