The basic problem is “corporate Hollywood”, non-entertainment corporations buying entertainment corporations as investments, ignoring the purpose of why they are entertainment corporations in the first place.
A bad economic model: make a few huge blockbuster movies a year.
A movie with a $200m budget that makes $220m at the box office is worth less than a movie that costs $2m and makes $30 million at the box office. Simple fact. However, if just a few blockbusters fail, it risks the entire studio.
A good economic model: Golan-Globus, Cannon films. They produced dozens of low budget movies, and if just a few of them were popular, they paid for the production of all of them, and made a healthy profit as well. Better yet, a lot of them were popular, and are still remembered today. Golan-Globus made a fortune.
The difference being that Golan-Globus made movies that their audiences wanted to see, but corporate Hollywood makes movies *they* wanted their audiences to see. This is not a subtle difference.
But corporate Hollywood is utterly blind to this simple equation. How many anti-Iraq war movies did they crank out, even though they all went stinker at the box office? Pattern recognition failure.
It has been known for decades that the most profitable movies are family friendly, with good writing and acting.
But corporate Hollywood doesn’t want to do that. Instead, it wants a lot of action, a lot of cgi, nothing controversial or innovative, formula plot and the same tiny group of homogeneous actors.
And yet Hollywood passed on distributing Mel Gibson's The Passion Of The Christ.
They were free to do so but the shareholders should have divested since the studios work against the profit motive in favor of politics.
With the internal politics of Hollywood, the losses of that $220million movie would be written against that debut hit (or fledgling hit) to protect the clout of A-list directors/actors. Hollywood engages in creative accounting and that "food cart" could be padded with all sorts of expenses. Same with "promotion" costs.
Another thing is when the corporation owns a tv-cable channel. Ever wonder why the Batman movie with "Arnold" aired so much? Time-Warner owns HBO. Pad the calendar until it breaks even.
And yet, when a film DOES hit (like the first Burton Batman) Hollywood engages in creative accounting to declare that it never turned a profit (writer Sam Hamm was to get a percent of the profits).
And the people who play these games and rape 13 year olds with alcohol and pill cocktails dare to lecture us about a “culture of corruption”.