t; Warner Music Group, although now its own entity, was previously under the umbrella of Time Warner; and the EMI Group is owned by a private investment firm.
Although the Big Four dominate the recorded music industry, they have surprisingly little to do with live performances. Traditionally, musicians have toured to promote their albums—and sell enough copies to pay off their advances—and the live show was a combination of self-promotion and income. An artist’s record company provided financial support, but a concert ticket generated significantly more income per sale than a CD. Since the merger of ticketing companies Ticketmaster and Live Nation, the ticketing services for large venues have practically been monopolized. For example, Madison Square Garden, one of the largest venues in New York City, does not handle its booking in-house, and with good reason; the technology to manage tens of thousands of fans trying to buy tickets to a soon-to-be-sold-out concert the day they go on sale would likely break the system. Instead, Ticketmaster handles all of the ticketing for Madison Square Garden, adding a 10 percent to 20 percent fee to the face value of the ticket for its exclusive service, depending on the venue and price of the show.
Because of the nature of film, the economics of the medium are slightly different from those of music. The absence of film in broadcasting, the lack of a live performance, and the exponentially higher budgets are just some of its unique facets. As with music, however, large companies tend to dominate the market. These massive studios are now connected corporately with other media outlets. For example, Sony and Universal both have partners in the music industry, while Fox and Disney control major television broadcast and cable networks as well as film studios.
Just as record labels do with radio conglomerates, film distribution companies tend to sell to large chains, such as the over 6,000-screens-strong Regal Entertainment Group and the over 4,000-screens-strong AMC Entertainment, which have national reach.National Association of Theater Owners, “Top Ten Circuits,” July 1, 2009, http://www.natoonline.org/statisticscircuits.htm. However, independent filmmakers still provide limited competition to these larger studios.
The founders of Miramax, brothers Bob and Harvey Weinstein, had a messy breakup with major studio Disney.
Brothers Bob and Harvey Weinstein founded Miramax in 1979 with the intention of independence. Over the ensuing years, they released films that were off-limits to major distributors, such as Quentin Tarantino’s violent Reservoir Dogs and Steven Soderbergh’s controversial Sex, Lies, and Videotape. After Disney bought the smaller studio in 1993, Miramax gained access to even larger financial backing, albeit somewhat begrudgingly. Miramax had cultivated relationships with the now-blockbuster directors Tarantino and Kevin Smith—the director of Clerks, Dogma, and Jay and Silent Bob Strike Back—and when Tarantino’s Pulp Fiction made more than $100 million at the box office within 2 years of Disney’s purchase of Miramax, it seemed like a good deal. As a result, Disney signed the Weinsteins to a new contract, giving them an annual budget of $700 million, and in 2003 Disney gave the Weinsteins permission to raise additional hundreds of millions of dollars from Goldman Sachs in order to make even more expensive movies.“Significant Events in Disney’s Ownership of Miramax,” New York Times, March 5, 2005, http://www.nytimes.com/imagepages/2005/03/06/movies/20050306_MIRAMAX.html.
By 2004, however, relations between Miramax and Disney were turning sour. In May of that year, Disney would not allow Miramax to release Michael Moore’s incendiary documentary Fahrenheit 9/11. In response, the Weinsteins sought outside funding and released it themselves to great success; the film became the highest-grossing documentary of all time, with revenue of $222 million on a mere $6 million budget.Box Office Mojo, “Fahrenheit 9/11,” http://boxofficemojo.com/movies/?id=fahrenheit911.htm. A year later, the We