Rebirth of America, this is my era

Chapter 298 Great Harvest

As of the evening of December 31, 1979, Johnson's home console had sold a total of 7.63 million units in North America, bringing in $1.525 billion in operating revenue for the game of Destiny.

Although the data looks a bit strange after the explosion of 600 million in three days, because its subsequent sales momentum has fallen precipitously, which is completely different from normal commodity sales.

But anyone who is engaged in marketing knows that no matter what the product is, as long as it can drain the market's purchasing power in an instant, it is awesome. This is a true reflection of market popularity and public love.

But even if this sales trend is impressive, it cannot become the most eye-catching focus in the report. What is really exciting is that the number of 7.63 million units corresponds to 7.63 million households.

Today, the total number of households in the United States is approximately 80 million!

Seven million six hundred and thirty thousand account for 9.53 percent of it!

That is to say, after half a year of sales, nearly ten out of every hundred households use their products!

This kind of achievement——

It's terrifying!
“Is this number accurate?”

Ethan flicked the document in his hand, his face full of pride.

"You won't fill in the shipment volume here, right?"

"Oh! My boss! How could we do such a thing?" Ballmer complained, "These data are all provided by the underwriters, and we just added them up!"

"Really?" Ethan said in a teasing tone, "Steve, it's not that I don't trust you, but I don't trust the speed of those merchants. At the end of every year, major merchants in North America will launch Christmas sales and New Year's promotions. When everyone is busy, how can they settle the bills so quickly?"

"Because our products are selling well..." Ballmer would answer this question, "Just after Christmas and New Year, many stores urged us to restock!"

“When they come to settle accounts with the sales proceeds, won’t the data come out?”

This explanation made Ethan nod repeatedly.

After they renegotiated the contract with the underwriter, the data did improve.

It’s not that he doesn’t believe these data, but the affirmation from others will make him feel happier.

Look down and continue browsing.

After deducting production costs, R&D expenses, sales expenses and financial expenses, the operating income of 1.525 billion brought them an operating profit of 102 million, with a profit margin of 6.7%.

To be honest, this data is not as good as that of the arcade machine.

But Ethan doesn't care, because the console is for games.

And in addition to Johnson's home console, last year's Destiny game brought in other revenue.

For example, arcade machines.

Although Destiny did not launch an arcade game last year, the Ms. Pac-Man arcade machine sold very well before Starfield was released.

So far, its total shipments in North America have exceeded 150,000 units.

Sales in the first half of last year alone brought Destiny Game nearly 100 million in profits.

Another example is the fees for some franchise rights. The Happy Meals in cooperation with McDonald's brought a lot of benefits to Destiny Game, and later, the toys in cooperation with Disney also made Destiny Game a small profit.

For example, the agency fees that Nintendo should have paid for last year, and the game sales report that Yamauchi Hiroshi had not yet asked his son-in-law Arakawa Minoru to submit.

According to past performance estimates, the profit here can exceed 100 million.

In other words, if nothing unexpected happened, Destiny Game would have a bumper harvest in 1979, with annual revenue exceeding 1.8 billion and operating profit reaching 300 million. According to revenue ranking, they would at least be among the top 200 in the world, and if they were ranked according to profit...

Then their profits can be further reduced.

After looking through the accounts of Destiny Game, Ethan looked through the report of Destiny Pictures next.

Last year, Destiny Pictures launched the movie "Alien" in conjunction with the Destiny game. After half a year of screening, it earned 163 million yuan at the box office.

Although many movies released last year have not yet finished their screenings, such as "Kramer vs. Kramer," "Gilchuck," and "Star Trek: Infinity," which were released during the Christmas season and have only been released for a month, there is still a lot of room for profit.

But no matter who you are, you will think that "Alien" was the annual box office champion in 1979.

And this kind of false reputation is not what Ethan cares about. Now all he wants to see is the financial report of Destiny Pictures. After deducting the share of North American theaters, Universal's publicity and promotion commission, Steven Spielberg and George Lucas' producer dividends, and the profits of the two authors of the original work, the box office dividend attributable to Destiny Pictures is 50.53 million.

It accounts for about 31% of the total box office revenue.

Continue to deduct a series of expenses such as production costs.

The final profit of the popular project "Alien" was about 38.07 million...

"Thirty-eight million and seventy thousand?"

"So, the return rate of the Alien project is 475 percent?"

The numbers on the report allowed Ethan to quickly calculate the value of "Alien".

On the surface, this rate of return is simply amazing, but considering the number of films produced by Hollywood every year and the beautiful scenery that only North America can enjoy, the fact that the film is a needle in a haystack makes film investment a gambling game.

A probability of one in a few hundred is only slightly better than winning the lottery.

"Yes, the return on investment for Alien was indeed a staggering four hundred and seventy-five, but there is only one company that can taste this kind of victory every year." Steve Ballmer nodded with emotion.

"Film investment is really a job where the risks outweigh the benefits. Behind every legend are hundreds of failed skeletons, so countless companies in this industry go bankrupt every year."

"However, this situation has taken a turn for the better in recent years. With the popularity of videotapes, even if many movies fail at the box office and cannot make back their investment, the producers no longer have to leave the market with regret as before, because they can slowly recoup their investment by distributing videotapes..."

At this point, Ballmer seemed to remember something.

He paused, then smiled and said, "Oh, by the way, boss, Gary Kurtz asked me to report something to you. He said Universal wants to release the videotape of Alien this year."

"The tentative price is $19.99, the same as Jaws, which has the same positioning."

"What?" This news made Ethan raise his head.

"Do they think there's no more room for Alien to make at the box office?"

"Yes."

"So how do they want to charge?"

"Thirty percent."

"Thirty percent?"

Ethan frowned, "We take 70 percent?"

"No——" Steve Ballmer shook his head: "This is just a separate commission."

"Things like production costs, publicity costs, sales expenses... these still have to be borne by us."

"Alien" has not actually been officially taken off the screen.

Because the release dates of Hollywood movies are not fixed.

As long as there is market demand and North American theaters feel that a movie can make money, distributors and producers will continue to grant screening authorizations in accordance with their requirements and will not take back film copies.

But at the same time, North American theaters cannot prevent distributors from selling videotapes.

After all, we are all commercial companies and our goal of operation is to make money.

So when Ballmer said Universal wanted to release the video, his first reaction was that Universal felt that Alien was no longer profitable in the North American box office market, and his second reaction was...

Then Spielberg might be causing trouble.

Otherwise, how could Universal dare to ask for such a high price?
"Steven's company is already established?" he asked.

"Yes, it was established a few weeks ago on January 1st, and it's called Amblin." Ballmer said: "In Steven's words, although he left Universal, he still remembers the early years, so he decided to use the name of his first movie as the company name." "However, although Steven said in an interview that his departure would not damage the relationship between him and Universal, his decision still caused Universal's stock price to plummet."

"Yeah." Ethan nodded slightly and said, "Is there any impact on Disney?"

"No." Ballmer said regretfully: "Steven's independence only affects Universal."

“The share prices of several other film companies even saw small increases.”

“Perhaps from the market’s perspective, his independence is a boon to other companies?”

Ethan understood what Ballmer meant.

When Spielberg announced that he would set up an independent film company, in the eyes of all investors, Spielberg was now the target that the other companies could compete for.

Even though everyone knows that this is just a beautiful dream and Spielberg will only choose Destiny Pictures, before he officially announces it, this false benefit is a tool for the organization to make profits.

And when the whole world knew that Spielberg was kidnapped by him...

The most outrageous thing would be if Universal was not angry.

But even if they are angry, they can't kill people at will!
"Is 30 percent reasonable?" Ethan asked.

"The general charge in the industry is between twenty-two and twenty-eight."

Ballmer replied, "At the same time, the distribution company will bear part of the production and distribution costs, and the specific figures will be adjusted according to the popularity of the movie."

"I see." Ethan nodded and said, "Tell Gary Kurtz to negotiate with him on his own merits. We will give him whatever the fair share line in the industry is."

"We won't give you a penny more."

"I accept all the shares that are put on the table, but if they make unreasonable offers in other aspects, I don't mind hammering them out too!"

“Oh yes, and overseas distribution as well.”

"Since there is no more profit margin to be made in the North American box office market, this movie can be exported overseas. The first stop... let's choose Japan."

"Okay, boss, I understand." Ballmer nodded quickly.

After making this decision, Ethan put aside the film industry report he had just read.

Just as he was about to open the report file of Destiny Music, he remembered something else.

"By the way, now that we're done with Alien, what's Gary Kurtz thinking?"

"Not at the moment." Ballmer knew what his boss was talking about and said, "He doesn't seem to have any intention of investing in new films, even though our company has received quite a few projects."

"But it doesn't matter, because George and Steven have taken over the job..."

When Ethan overturned the Hollywood table, Destiny Pictures' status in Hollywood changed from a new force disruptor in the beginning to a real giant today. Hollywood practitioners who were still on the sidelines immediately showed great enthusiasm for Destiny Pictures and sent in scripts, wanting to cooperate.

But unfortunately, Gary Kurtz is a man of ideals and principles.

His ideal was to win the Academy Award, the highest honor in the film industry, and his principle was not to go against his boss. So when he found out that Ethan Jones' attitude towards Destiny Pictures was the same as that of all businessmen, which was profit-seeking, he did not start the film review work for Destiny Pictures.

Because he knew that the Ethan he liked was most likely not liked.

And what Ethan liked, he probably couldn't make.

Before, he didn't know how long this conflict would last, but now, when Ethan Jones invited Steven Spielberg and George Lucas to join Destiny Pictures as co-presidents of the company, he could rest assured and let others do this money-making work.

"He's quite tactful," Ethan commented with a smile.

Ballmer just stood aside and smiled, but did not respond.

After a few seconds of silence, Ethan made a decision. "Tell Gary Kurtz that I am very grateful for his help to Destiny Pictures. I am not an unkind person. If he wants to win an Oscar, I can give him an investment quota of two million per year so that he can invest in the movies he wants to invest in."

"The contract we signed originally was for five years, right? There are still three years left?"

"Only six million."

"If he succeeds, I will fund him to set up his own film company. If he fails, we can renew the contract with him, but the investment amount will be gone."

"The criteria for judging success is very simple. If a movie he invested in can get a nomination for Best Picture or Best Director, it is considered a success. Or if it wins the Best Screenplay and Best Editing awards, it is also considered a success. Other awards... have little to do with the producer, right?"

"Uh... maybe?" Ballmer was not sure how to answer such a professional question.

But he will convey the boss's will to his subordinates.

After solving the problems of Destiny Pictures, Ethan also picked up the report of Destiny Music. Unlike the double harvest of game and movie projects, Destiny Music suffered losses throughout the whole year last year.

They spent a total of 20 million but didn't make a penny.

Of this, fifteen million was spent by Ethan himself.

This was divided into two parts. The first part, 10 million, was used to buy Michael Jackson from Columbia Records. Since the transaction included the copyright of "Off the Wall", he would be able to obtain the commission that originally belonged to Epic Records after the album entered the settlement period. The remaining 5 million was used to invest in 50% of Geffen Records' equity.

The remaining five million was spent by David Geffen, who used the money to sign Donna Summer, John Lennon and his wife Yoko Ono, the Berlin Band and Debbie Harry, and bought a recording studio in Los Angeles and purchased a lot of necessary equipment...

At first, when Ethan saw this, his first reaction was that David Geffen was very professional and signed John Lennon at the first try, which was really awesome.

But after he read the report carefully, he immediately laughed.

Because David Geffen was doing something naughty right under his nose.

Even though Ethan gave Destiny Music five million for operating purposes, David Geffen did not use debt to move Destiny Music's funds into Geffen Records. Instead, he used his authority as chairman of Destiny Music to use Destiny Music to absorb as many assets that could not appreciate in value but had to exist as possible.

For example, he placed all transactions such as purchasing recording studios and recording equipment in Destiny Music. The remaining potential resources, such as John Lennon's singer contract, were firmly held in his own hands, that is, in Geffen Records, in which he held a 50% stake.

When Ethan realized this fact, his face was full of emotion:

"David Geffen is really a qualified businessman—"

"I clearly gave him a chance to be reborn, to start over in the music industry, but I didn't expect that all the valuable singers were signed by him?"

“This is truly a qualified businessman!”

Ethan admired David Geffen's boldness.

But at the same time, he had to admit that David Geffen's operation was fine.

After all, when they signed the contract, there was no agreement to put all the artists into Destiny Music. In this case, if David Geffen found a loophole and did not seek money, then there was something wrong with his thinking.

Ethan didn't care about this harmless little trick at all, or perhaps, when David Geffen tried his best to deal with famous artists in his own company, it was clear that he wanted revenge.

When a capable person starts over with a vengeful mentality, no matter who is blocking his way, the flames of anger will make him break the tiger's teeth.

After that...

He would definitely twist off his enemy's skull with his own hands!

And on David Geffen's list, that person's name was Steve Ross.

After reading through the accounts of the three entertainment companies, Ethan only had one account left to look at. When he opened the report of Michael Blanco Manufacturing, the record number of employees made him raise his eyebrows, and he suddenly realized and laughed out loud.

"Oh Steve!"

"You told me about Chrysler after you saw this report, right?"

"Michael Blanco's company is almost over 8,000 employees?"

“This scale is indeed quite large!”

(End of this chapter)