What is the average budget for a Hollywood movie?

Author Name Answered by: Ralph, An Expert in the Movies Category

To answer what the average movie budget for a Hollywood film is, several terms must be defined. First we must determine if by “average movie budget”, we mean simply the cost of making the movie, or if we are including the money spent to market the film. Depending on the genre of the film, the size of the studio or distributor releasing the film, and the time of year that the film will be released, marketing costs may run from $1 million to $20-30 million, or more.

For the purpose of this question, let’s decide to keep it simple and just discuss the actual cost of making the movie: “above the line” costs (Writers, Producers, Director, Actors) and “Below the line” costs (production crew, locations, equipment, materials, food, and incidentals.) So what is the average now? We don’t quite have enough information to calculate it yet. Even though we’ve eliminated the marketing costs in our calculation of the average movie budget, there is still another decision we have to make: how do we define a “Hollywood Film”?

At the most basic level, one could define a “Hollywood film” as one that is released and/or distributed by a major studio. We have to keep in mind though, that studios often acquire and distribute films that they did not actually make, but were originally produced independently. One of the best known examples of this is “The Brothers McMullen” (1995) by Edward Burns. He produced the film himself for $25,000, but after winning the Grand Jury Prize at the Sundance Film Festival, 20th Century Fox purchased and distributed it.

Of course, much more money was spent to distribute and market the film, but since we aren’t counting that into our calculations of average movie budget, the total cost of production stays at $25,000. Is “The Brothers McMullen” a Hollywood film then, since it was produced independently? Since it was acquired by a major studio and had a widespread theatrical release, it should indeed be counted as such.

So “The Brothers McMullen” is one of the movies with the lowest budget that can be considered a Hollywood film, but what about the projects on the other side of the spectrum? Movies such as “Avatar”, “Pirates of the Caribbean”, etc. Well, studios don’t like to release “official” numbers, especially for huge, expensive blockbusters like those. They also may attempt to make a movie look more or less expensive to the public to suit their purposes, so numbers may differ from source to source. For example, some sources put the production costs of “Avatar” between $200-300 million, some say it was in excess of $300 million. Big difference. So what should you believe?

For the purpose of answering the original question, let’s refer to the site www.the-numbers.com. They list the top 20 highest movie budgets of all time according to the best information gleaned from studios, and the top 20 movies with the lowest budgets that earned at least $1 Million at the US box office. This is a good place for us to get a general average, because those 2 lists will give us a rough estimate of the total cost of both high and low budget movies that were theatrically released in the US.

In order to stick with our decision to only count movies that were distributed by a major studio, we will eliminate 7 of the top 20 lowest budget films, because they did not have major distributors. Here’s the math:

Highest Budget films (total production cost of top 20): $4,589,000,000
Lowest Budget films (grossing at least $1 million @ B.O.): $795,000
Average Movie Budget of these 33 movies: $139,084,697

This calculation is in no way definitive, as it only takes into account the highest and lowest budgets and excludes films that were not distributed by a major distributor, but it does give a realistic idea of how much the average budget is for a Hollywood film.

In recent years, the gap between the highest and lowest budgets has widened as studios spend more and more to attempt to lure people from their Home Theatre Systems and into theatres with 3-D effects and amazing computer animation. On the other side of the spectrum, as the cost of quality tools for shooting and editing movies has come down, and online movie consumption grows, budgets may become even smaller. But for now, it still costs about $139 million to make a major Hollywood film.

Sources: www.the-numbers.com, www.slashfilm.com, www.imdb.com

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