#major studios

There are two broad phases in film-making: production and distribution. Production is where money is spent in creating the product; this is where the expenses are. Production includes everything from paying the talent to making the costumes. After the production stage the distribution stage becomes the main focus. Distribution includes marketing via the internet, TV, billboards, radio and any other media outlet they see fit. Distribution is essentially selling the film to people. Production is the area where money is spent; distribution is the area where money is made. Major studios are experts in both areas.  Because of the major studios' marketing and distribution capabilities, they are obviously the most financially sought-after option to go with, as well as being the hardest to get in contact with.

Four things make a studio a “major” studio: it must have its own production capabilities, its own studio lot, its own financing capabilities, and its own distribution and marketing capabilities. A major studio will distribute films internationally and domestically in a vast majority of cases, meaning they have worldwide distribution.

If a studio does not fill all of these roles then it is not a major and may be either a mini-major or simply a production company. If a film were to be released by one of these smaller types of studio then whichever of the four integral roles of a major studio that are missing will have to  be sought out elsewhere in order to have the same reach as a major studio. A good example of a mini-major is Lionsgate and the Weinstein Company. In Hollywood there are 7 major studios: Sony, The Walt Disney Co., NBC Universal (Comcast Corporation), Time Warner, Viacom, CBS Corp., and News Corp.

A filmmaker should understand that they almost always need a star-driven cast if they hope to reach a major studio. Once they have this, the filmmaker should look into which studio is known to make the genre of film that the filmmaker is interested in creating, and how that studio can make money in multiple ways off of said genre. This is called horizontal and vertical integration.

Horizontal integration refers to when a studio distributes a film in one form of media that its parent company owns, then distributes in other forms of media that its parent company also owns.  All the revenue made from releasing the film in all forms of media goes to the parent company.  The common path is usually: a film going from the theatres then to streaming services, then to pay-per-view, then to premium paid cable (HBO, Showtime), then to home video, then to basic cable, and then finally to free TV or network TV. This is often the path that horizontal integration takes in reference to a feature film; but some areas, like streaming and pay per view, may be switched depending on the film.  In this process, the studio must make a deal with each medium based on fair market value, and not a "sweetheart deal".  A sweetheart deal is one that is less than market price.  The reason why sweetheart deals are not made is because the profit participants in the film would be deprived of gross receipts that would have been earned had the rights been sold to third parties on the competitive market.   

Vertical integration is taking the film and utilizing it to sell other types of products. Disney is a good example of a company that uses vertical integration efficiently. Disney often uses a film to sell merchandise, make rides at Disneyland, sell books based on the film, have it as a feature on their cruise liners, make videogames, food products, etc.

However, not all films lead into vertical integration. There are a few parameters that must be met before vertical integration can be successfully utilized. The film must be released worldwide, it must have a big budget (over $15 million), it must have a star cast, it must have sequels or be able to have sequels, and it must be a franchise.  All of these things need to be kept in mind when writing or pitching a film to major studios. The more they can capitalize off of your work, the higher chance you have of getting the film picked up.

One of the most important things to understand while writing a film (if you plan to pitch it to a major studio) is how the studio will market your work. There are four marketing areas you want to hit when you begin to write a film: the male demographic, the female demographic, people aged 12-24, and people aged over 24. Most films only hit one or two of these, but very well-known ones have hit all four. Star Wars, Transformers, and The Avengers are all good examples of films that have covered their marketing basis completely. 

It is also important to find a distributor in advance before the film is put into the production stage. The distributor becomes one of the main investors.  Moreover, other investors know they have no chance of getting return on their investment if the film they are investing in does not have a distributor to start with.

Overall the film industry leans toward business much more than artistry. Because of this, filmmakers who want to reach a wide audience using a major studio must make sure they implement these business-centric ideas into their film, even if it takes away from their artistic integrity; otherwise, they might not have a film at all.