Posted by Jeff as Uncategorized
Interesting look at the economics of movie star paychecks. I was rather surprised to read that Nicole Kidman generated a measly $1 in gross income for every dollar she was paid, making her the most overpaid movie star in the business… but then again I can’t remember the last time I saw a movie that she was in that I liked.
To calculate our payback figures, we took half of each film’s worldwide box office (to roughly approximate the studio’s cut of each ticket). Then we added the first three months of DVD revenues and subtracted the budget to derive the film’s gross income. After that, the actor’s total compensation (upfront pay plus any money earned from sharing in the film’s profits) was divided into the gross income to get the actor’s payback figure for the film. The payback for the last three movies for each actor was averaged to calculate ultimate payback. We deliberately used gross income rather than net income in our analysis because the latter figure is so easily manipulated by studio accountants, with marketing expenses treated differently for almost every film.