Hollywood Profits Climb Sharply by Shifting to Family Films

FOR IMMEDIATE RELEASE

Contact: Tara Powers
Lambert, Edwards & Associates
616.233.0500
[email protected]

Dove Foundation Study Shows G-Rated Films Still Get Greatest Profits

Grand Rapids, Mich., June 07, 2005 – A new, 15-year study released today examining the profitability of films based on their Motion Picture Association of America (MPAA) ratings reveals G-rated films continue to profit significantly more than their R-rated counterparts.

The Dove Foundation commissioned a study that examines the revenues and negative costs for the 3,000 most widely released movies from January 1, 1989 through December 31, 2003, updating its landmark 1999 study that looked at films released between 1988 and 1997. 

The updated, 15-year study tracks the latest films relative to profitability, and evaluates the changes and lasting impressions on film studios as a result of the first study. The data was assembled by Kagan Media Appraisals and analyzed by the Finance department of Seidman College of Business, Grand Valley State University.

Notably, the study found that:

  • While the movie industry produced nearly 12 times more R-rated films than G-rated films from 1989 – 2003, the average G-rated film produced 11 times greater profit than its R-rated counterpart
  • G-rated films released between 2000 and 2003 produced an average return on investment three times greater than R-rated films. 
  • Between 2000 and 2003, Hollywood produced nearly four times as many PG-13 films as PG.  During that same time, the average PG film produced $33 million or 43% greater profit than a PG-13 film.

“Movies such as Shrek II, Finding Neverland, National Treasure, The Incredibles and Miracle – all rated PG – are action and adventure films, comedies, dramas and mysteries – but without the explicit language and gory special effects that are rampant in R-rated movies,” said Dick Rolfe, Founder and Chairman of The Dove Foundation.  “This study clearly demonstrates that families around the country have favored, and continue to favor, wholesome, family-friendly movies – not movies filled with gratuitous sex, violence and obscene language that studios have long claimed make the most money.”   

Previously, the 1999 study found the average G-rated movie made eight times the profit of its R-rated counterpart. This 2005 study documents that the per-film profit ratio between G and R has jumped to 11:1.

The updated study found significant differences in the number of G and R-rated films released before and after the 1999 indicating the findings may have resonated with Hollywood studio executives.

Specifically, since 1999, the production of:

  • R-rated films decreased 12%.
  • G-rated movies increased by 38%.

The study further reports that over the15 year period, the major Hollywood film studios produced 123 G-rated films, accounting for approximately four percent of the 3,000 most widely released films with an average profit of $79 million each.  During the same period, the major studios produced 1,533 R-rated films, accounting for approximately 51% of the same 3,000 films with an average profit of only $7 million each.

Miramax/Dimension, a subsidiary of Walt Disney Studio Entertainment, released the most R-rated movies during the study.

“Clearly, if Hollywood is worried about a recent decline in attendance and the resulting loss of profits, they should be producing more G- and PG-rated films,” said Rolfe.  “The general public is voting with their feet, heading to movies that the whole family can enjoy without having to worry about exposing themselves or their youngsters to inappropriate language or behavior.”

Since the Motion Picture Association of American introduced the movie ratings system in 1968, nearly 60% of all films released by Hollywood have been rated R.  The results of The Dove Foundation’s comprehensive, 15-year study on film profitability debunk the myth that R-rated movies drive profit with hard numbers that impact Hollywood’s bottom line.

“Change in American cinema is imminent,” Rolfe said.  “With the exception of ‘The Passion of the Christ,’ the top 20 domestic box office films of all time are rated G, PG or PG-13.  Wholesome, family-friendly movies are truly the way of the future for the entertainment industry.”

About The Dove Foundation

The Dove Foundation is a nonprofit corporation whose mission is to encourage and promote the creation, production, distribution and consumption of wholesome family entertainment.  The Dove Foundation commissioned these studies due to the lack of family oriented films produced in relation to an increasing number of films containing gratuitous sex, violence and profanity.  Believing that movies that appeal to the broadest segment of the population are an important part of any studio’s profit equation, The Dove Foundation sought to determine which films by MPAA rating produce the greatest profits and highest rates of return on investment (ROI).

Dick Rolfe, Dove Foundation Co-founder is available for interviews upon request.  For more information, please contact Tara Powers at 616.233.0500.

###


Download the 2005 ROI Study