DO THEATRE OWNERS MAKE ANY PROFIT? Advance method Advance method is just like M.G except in this case loss is shared between the theatre owner and distributor whereas in M.G the loss is borne only by the theatre owner. If the advance paid by the theatre owner for the distributor is 5 lakhs, the same percentage ratio would be in practice. After the advance amount of 5 Lakhs is realised in collections, the extra income is shared between the theatres and the distributor, just as in M.G. But this is where the similarity ends. Perhaps the advance paid to the distributor (5 lakhs) is not realized in theater collection (ticket sales), the theaters are not in trouble here. Because, in advance method, the rest of the amount in the advance paid minus the collections has to be paid by the distributor to the theaters. This is why advance method is favorable for theater owners. But all these things would happen if the movie’s distribution house is ethical and renowned. Advance would be paid only if the distributors or the distribution company is trustworthy enough to pay the money back in case of poor collections. There are lots of theater owners who have risked their advance money with infamous distributors and struggle to get it back. Hence, the theater owners would not risk their money if it were not a reputed distributor. Advance method would be followed for films with average cast and crew and theaters which relatively generate more revenue, irrespective of which kind of movie is screened there. For micro-budget movies, there is a practice to collect only the print expense of the movie the minimum advance from the theaters. Sharing would be based on the same ratio as we have seen here. Terms In terms method, without any advance or M.G, the theater owners would fix the ratio sharing with the distributors and allow them to release their movie in their theatres. Most small budget movies are released in this route. Many small movies, which are released directly by the producer himself without distributors are released with this terms agreement. This is a relatively trouble-free method. At times, however, theater owners tend to deceive the producers or distributors, not allotting their fair share. Hire Hire is the process of renting one copy of a film for complete ownership for a single release or single run. In other words, the ownership is valid only till running the film in a theater and hirer gets the collections. Mostly, hire process is followed for films that surprisingly do well post their release. For such movies, theater owners would advance with the hire deal to the distributors or producers who release the film, strike a hire deal and release in their theaters. For a movie, which is hired for 2.0 Lakhs, all it collects goes only to the theater owner; so is the loss. Interestingly, in many times, these hired movies only would bring the profits home to the theater owners, hence considered lucky for them. Also novices and learners in the distribution business, learn the tricks of the trade by screening a film in a known theater, primarily with hire process. It is best suited for start up distributors. More on multiplexes and their agreements later