It's reasonable for me to be a three-time Golden Horse Award-winning director and an all-around

Chapter 201 Harvest and Development Planning... (Seeking monthly votes)
The following morning, Lü Rui got up early.

He first found the housekeeper and asked him to help prepare breakfast after the others got up, and then drove to Ruixing Film Studio.

Peter isn't exactly overwhelmed, but he's been incredibly busy lately with a mountain of tasks piling up.

The main problem is that he lacks the authority to make final decisions on many things, which leads to unfinished old tasks and difficulty in fully committing to new ones.

The key point is that these are not things that Lü Rui can handle simply by delegating authority; almost all of them involve the company's future development.

"Paranormal Activity has grossed $1.37 million at the North American box office. After splitting the revenue with Sony, we will receive a net profit of $3425 million."

As soon as Lü Rui arrived at the office, Peter walked in with the financial statements.

Sony only received 20% of the film's North American and overseas distribution revenue.

Although the percentage is still not low, it is already considered a "friendly price" compared to the regular revenue sharing in the North American market.

With this revenue, the net profit of "Paranormal Activity" has now exceeded 100 million, making it the most lucrative income for Ruixing Film Company in 2005.

While reviewing the reports, Lü Rui pressed for details: "What projects does the company currently have that require working capital?"

“No.” Peter shook his head. “The funding for 300, Life of Pi, and Twilight is all in place.”

“Then we’ll keep a portion for continuing to acquire novel copyrights, and the rest as a ‘loan’ to the Brom House to support their development.”

"Okay."

Peter immediately wrote it down.

The company already has three projects underway, so it is not advisable to start any new ones.

The money is just sitting idle, so it's better to use it to pave the way for future work.

Lu Rui flipped to the last page of the report and signed his name.

This also means that the "Paranormal Activity" project has officially come to an end!
As for the subsequent revenue from DVDs, discs, etc., these are considered hidden long-term income and will be included in the company's annual revenue.

This is also the core reason why the six major Hollywood studios have been able to remain successful.

With a vast library of copyrights, even without launching any new projects for a year, they can still make a fortune simply by "living off their past achievements."

The most typical example is Disney, whose copyright revenue has remained stable year after year.

Of course, there are counterexamples, such as MGM Grand...

The company was already mired in financial crisis, and all its investment projects were losing money. It was a recipe for disaster to throw money at Wu Yu to make "Windtalkers".

"This is the financial statement of 'I Am Legend'."

After putting away the report on "Paranormal Activity," Peter handed over another stack of documents.

"The film grossed $2.91 million in North America, $4.53 million outside North America, and a total of $7.44 million worldwide. These are the final box office results for the film."

After deducting global theater revenue sharing, distribution revenue sharing, and marketing expenses, Ruixing Pictures' net profit is US$6320 million.
Subsequent revenue from discs, online licensing, and DVD sales has not yet been settled, but is expected to be no less than $8000 million.

Lü Rui nodded: "Okay, I understand."

With a net profit of $6320 million, plus the $3500 million that was kept during the accounting process, the film brought Ruixing Film Company a total of $9820 million in revenue.

This is just the revenue share from theaters; the subsequent copyright and derivative revenue will be an even greater sum.

This means that Ruixing earned nearly $2 million from this movie alone without spending a single penny of its own capital.

This deal was incredibly profitable!
Of course, compared to the huge profits of the distributors and the high revenue share of the cinemas, his earnings are not top-notch, but rather quite impressive.

Unlike mainland Chinese distribution companies, which are capped at 10% of distribution fees, the six major Hollywood studios can receive up to 30% of the distribution fees.

The production team works so hard but only gets a small share of the profits, and they still have to be subservient to others. It's really frustrating.

However, this was a choice made out of necessity.

Taking the top 100 North American box office hits of 05 as an example, apart from "Saw II" and "Diary of a Mad Woman" which belonged to Lionsgate, "Sin City" and "2D Raiders" which belonged to Dimension Films, and "Paranormal Activity" which belonged to Broome House, all the other films were distributed by the Big Six studios and their affiliates.

This monopolistic power forces many small companies to entrust their films to the Big Six studios and their subsidiaries for distribution.

They either have to accept their fate and eat the leftovers from the six major cinemas, or stay away from theaters and dabble in the DVD and videotape market.

Of course, the Holy Valley is an exception; they don't need to worry about the Big Six, since their movies can't be shown in theaters anyway.

The claim that distribution channels have been blocked by the six major players is completely unfounded.

The six major distributors have never locked up their distribution channels; they have simply established a global distribution network.

Many mid-sized companies have established separate North American distribution channels, such as Lionsgate and DreamWorks...

As for the collaboration between Ruixing Films and Blum House, nobody cares at all.

In fact, anyone can participate in global distribution operations.

But the prerequisite is that you must register branches in dozens of major voting bloc countries around the world!
Putting everything else aside, the exorbitant public relations and operating costs alone can bankrupt most film companies. Not to mention, there aren't necessarily that many high-quality films available for distribution. Doing this is simply a money-losing proposition!

To have your own global theatrical distribution channels, the minimum requirement is to produce more than five medium-to-large-scale productions every year; otherwise, it's simply out of the question.

Of course, Lü Rui doesn't need to think about that much right now.

You have to eat your food one bite at a time, and you have to walk your path one step at a time.

With the revenue from "I Am Legend", the company doesn't have to worry about its operations and expansion this year.

It's no exaggeration to say that even if they don't make any new films for the next three years, this money alone will be enough to support the company.

"Of this revenue, $4000 million has been allocated to the production account for 'Life of Pi,' and $3000 million will be used for the continued development of 'Twilight'..."

Listening to Peter's report, Lü Rui's lips twitched involuntarily.

The money he just received hadn't even warmed his hands before 7000 million was spent, which is truly frustrating.

But this is the norm in business. Often, as soon as the payment from the previous project arrives, it must be immediately invested in the next project. There is no room for any "idleness".

"The remaining $3000 million, plus the proceeds from the two films, will remain in the account as working capital for the time being."

Lu Rui gave a word of advice.

He had no intention of using the money for pleasure.

Having already spent $4500 million on a mansion, his desire for luxury has long since faded.

The next step is to make longer-term investments, such as in the field of special effects and visual effects.

The three movies, 300, Life of Pi, and Twilight, all rely heavily on special effects.

While they could collaborate with Warner Bros. or 20th Century Fox, it would be better to start their own special effects company than let others profit from it.

Anyway, costs can be optimized through accounting, and maybe by the time the three projects are completed, the special effects company will be able to establish itself.

Lu Rui briefly explained this idea to Peter, who immediately grasped it:
“Lv, I understand what you mean. I will find a mature special effects company as soon as possible to negotiate an acquisition and have it provide services exclusively for us.”

"Good!"

Lu Rui gave him a thumbs up.

Creating something from scratch takes too much time; acquiring an existing team is both time-saving and efficient.

He'd been eyeing this business for a long time.

After all, how can a film company that produces films upstream not have its own post-production center?

It's important to know that 99% of big-budget movies worldwide rely on Hollywood's special effects teams.

For example, domestic films like "Hero" and "The Promise," and even Zhang Yimou's "Curse of the Golden Flower," all rely on Hollywood teams for support.

The domestic special effects industry is currently a "dead sea," and no one dares to touch it.

There's no way around it, this business is just too damn expensive. Companies without a stable capacity for large-scale production simply can't afford to support it.

After all, special effects are charged by the second. Even if only 1/3 of a 120-minute movie requires special effects, the cost would still be astronomical!

Otherwise, Hollywood blockbusters wouldn't start with investments of hundreds of millions of dollars.

South Korea, on the other hand, has been working hard to catch up in the field of special effects, but it still lags far behind Hollywood.

After discussing the post-production center, Lü Rui and Peter finalized the details of the subsequent projects:
"300 and Twilight can be presented in 2D, but Life of Pi must be presented in both 2D and 3D formats."

Peter nodded repeatedly and wrote it all down.

He understood Lü Rui's considerations.

Hollywood has a relatively well-developed 3D market, but other countries still mainly watch movies in 2D.

Therefore, only by accommodating both formats can we achieve greater box office success and avoid becoming too niche for the general public.

“Lv, I heard that China is also gradually promoting 3D movie viewing? There seems to be a company called Wanda Cinema, which has strong financial resources?” Peter suddenly asked.

"Correct."

Lu Rui nodded, but a sense of regret couldn't help but surface in his heart.

There are very few cinemas in China that can support 3D playback, and even those that can mostly use equipment that has been phased out by Hollywood.

This has always been a thorn in his side, and it made him determined that when he invests in cinemas in the future, he must vigorously promote the construction of 3D viewing facilities.

Currently, this is a high-investment, low-return endeavor.

But he knew that in just a few years, 3D would become a highly sought-after product with low investment and high returns!

In fact, he had already been secretly preparing for the cinema chain layout for some time.

In 2002, China implemented a reform of cinema chains, requiring each cinema to join a cinema chain, with distributors then directly cooperating with the cinema chains.

Currently, there are more than 1300 cinemas in China, belonging to 37 cinema chains. Most of them are local chains, and very few can operate across provinces.

Currently, the top three cinema chains in China are Shanghai Film Group's Shanghai United Cinemas, Beijing Film Group's New Film Union Cinemas, and China Film Stellar Cinemas, all under the China Film Group Corporation.

However, according to the official announcement, the first round of cinema chain contracts will expire in June this year, at which time cinemas in various regions will have to choose a new cinema chain to join.

Lu Rui was aiming for this crucial juncture!

His plan was very clear.

Once the contract expires, we will first acquire an existing cinema chain as a foundation, and then either build new cinemas or acquire old cinemas for renovation.

Of course, all cinema locations have one prerequisite: they must not rent space; they must use their own property. This significantly increases upfront costs, as operating a cinema chain, like running a video streaming platform, requires substantial, money-intensive investment.

But in the long run, it's a highly profitable business.

Even if the cinema chain is unable to continue operating in the future due to some special reasons, the real estate they own can still maintain its value steadily, or even appreciate significantly.

Just think about the profit margin in buying a property now and selling it in 2025!
Peter then reported on the recent operations of Ruixing Film Industry:

"We have officially joined the Hollywood Producers Guild, and films such as 300, Life of Pi, and Twilight have been registered and filed with major guilds such as the Directors Guild, Screen Actors Guild, and Writers Guild..."

This means that these three films have since become a veritable "union project".

The cast and crew members, from directors and actors to production assistants and makeup artists, are protected by the corresponding labor unions, and their salaries, working hours, and working environment are all implemented in accordance with union standards.

Furthermore, the company will have to pay a substantial management fee to various labor unions based on a percentage of all revenue generated after the film's release.

Lu Rui could accept all the other procedures, but the fact that "the union collects money from the employer" made him, a Chinese person who grew up in a different environment, feel somewhat uncomfortable.

After all, in his mind, capital has always dominated industry, and now he has to "pay tribute" to the labor union, which feels a bit awkward.

But he also knew that when in Rome, do as the Romans do.

Hollywood's industry rules are already well-established; to gain a foothold here, you must abide by this system.

Therefore, he did not express any objection, but simply nodded and said, "I understand, just follow the procedure."

Seeing that he had no objections, Peter added, "After joining the alliance, it will be easier for us to find performers within the union system, and we can also participate in the alliance's resource sharing, which is good for the project's progress."

Lu Rui hummed in agreement, but in his mind he was already calculating:

Although it incurs an additional management fee, the trade-off of a more standardized production environment and more convenient resource channels makes it a worthwhile investment.

After all, in Hollywood, projects that are not affiliated with the union system not only struggle to find top talent, but are also prone to labor disputes, which can delay project progress.

……

After handling several matters at the company, Lü Rui immediately began his visit to the set in the afternoon.

He first went to the set of "Life of Pi" and had a detailed discussion with James Wan about the project's operational arrangements.

Big-budget movies have always meant an extreme pursuit of grand scenes.

20th Century Fox was quite generous, providing not only financial support but also an extra-large soundstage specifically for the production crew to build the core sets.

At this moment, the most eye-catching thing in the studio is the fully automated wave tank that is being built.

To create a realistic sense of "drifting at sea," the production team specially hired professional craftsmen to build the world's largest surfing installation.

The device can simulate wave effects of varying intensities, making the "ocean" in the lens more impactful.

But that's not actually the hardest part.

Because the film brings together three elements that are widely recognized in the film industry as difficult to film: "water, children, and animals".

Especially the "tiger" who interacts closely with the male protagonist in the film.

Real tigers obviously couldn't meet the filming requirements, so they had to be created using CG technology, which posed another significant challenge for the post-production special effects team.

"My goal is to break the traditional impression that 3D technology is only used in science fiction and disaster films, and to let the audience see that 3D can also present more delicate and emotional visual effects..."

After touring the studio, James Wan shared his creative ambitions with Lu Rui!

Lu Rui turned his head to look at him and suddenly remembered the stunning underwater scenes in the movie "Aquaman" that he made in later years.

James Wan truly possesses unique talent and experience in the fusion of "water" and "3D".

"Come on, I'm optimistic about you."

Lu Rui reached out and patted him on the shoulder.

"I will try my best to get this movie released in theaters the year after next," James Wan reiterated his promise.

Lu Rui knew in his heart that this progress was already very fast.

Pre-production takes more than six months, filming is expected to take more than six months, and with the addition of post-production special effects, the fact that it was able to be released in 08 is already a result of efficient progress.

Then he asked about the casting.

In the original novel, the protagonist "Life of Pi" is of Indian descent, which means that the casting process would inevitably have to involve going to India.

James Wan replied, "I will try my best to stay true to the original work. Once the water tank construction here is finished, I will simultaneously go to India to organize a large-scale audition to try to find the actor who best fits the 'Life of Pi' character."

Lu Rui added, "We could add more supporting actors from other ethnic groups. Minority groups have considerable film spending power, and this would also be more beneficial for future global promotion and distribution."

James Wan immediately nodded, indicating that he understood.

With an investment of up to $2 million, this film cannot rely on audiences in just one country to buy its tickets; global distribution is the key to recouping costs and making a profit.

Only by enabling audiences from different regions to find resonance with the characters can the box office potential be maximized.

After leaving the set of "Life of Pi", Lü Rui drove to the filming location of "300".

The casting process here is already complete, with the male lead Gerard Butler and the female lead Lena Headey, among other key actors, already confirmed.

Throughout the entire project, Lü Rui never interfered with any of Zack Snyder's decisions, completely letting him take the lead.

He believed in Zack's ability, just like in his previous life, to turn this epic action film into a classic.

As for himself, he only needs to be responsible for ensuring the final quality.

Upon arriving at the film set, Lü Rui saw the actors surrounding the staff as they signed documents.

"Lv, you're here." Zack ran over quickly to greet him.

Lu Rui smiled at him, indicating that he should go back to what he was doing.

The actors and staff are currently under insurance agreements.

In Hollywood, insurance is a crucial part of film production.

Although this would add an extra expense to the production team, Lü Rui was willing to do it.

Where resources should be saved, they must be saved; where resources should be spent, there must be no ambiguity.

It's important to know that taking out insurance here is never a bad deal. In case of an accident during filming, all losses will be covered by the insurance company.

There are too many variables during filming; props can be damaged, cast and crew members can be injured, and even filming locations can be destroyed.

If equipment falls and causes damage, or if an actor is injured while filming, the production company, Ruixing Film Industry, should theoretically bear the responsibility for compensation.

But with insurance, the burden can be entirely transferred to the insurance company.

Especially in action and war films like "300," the actors have to perform a lot of fight scenes, so the risk of injury is already higher than in ordinary movies.

For example, Tom Cruise, the "workaholic" of Hollywood in his previous life.

When filming the scene in Mission: Impossible 4 where he jumps off the Burj Khalifa, he personally performed the entire stunt, practicing climbing, running, and jumping on the tower, and was suspended there for eight whole days!

Without an insurance company to cover it, the production team wouldn't dare let him take such a risk. If something went wrong, the entire production cost wouldn't be enough to cover the losses.

Of course, Tom Cruise is just an exception.

While Hollywood actors are generally quite dedicated, those who work this hard are ultimately a minority.

Even so, some actors have been turned away by insurance companies due to the high risk involved.

For example, Robert Downey Jr. went in and out of rehab multiple times in his early years due to drug use.

This resulted in no insurance company being willing to insure him between 1996 and 2001, and many film crews being hesitant to use him.

The situation only improved after Mel Gibson stepped in to vouch for him.

Jackie Chan, an action superstar known for his "daring" actions, was once refused insurance coverage by an insurance company because he was too reckless during filming.

Fortunately, 300 doesn't have that many extremely dangerous scenes.

Although the actors also have to film fight scenes, most of the action choreography is controllable, so they don't have to risk their safety like Tom Cruise or Jackie Chan.

Seeing the actors sign their insurance agreements one after another, Lü Rui felt relieved.

This is like adding a layer of security for the crew, allowing for more secure progress in subsequent filming.

"Lv, let me introduce you. This is Gerard Butler."

Zack brought the male lead he had personally chosen to Lu Rui.

"Hello."

Looking at the future "Hollywood hero spokesperson" in front of him, Lü Rui gave him a kind smile.

Gerald was a little nervous when he saw Lü Rui, after all, he had always worked in the UK and had never starred in a big production before.

Now, with a $1.5 million investment in an action/war/epic film right off the bat, he inevitably feels immense pressure.

However, pressure can also be a source of motivation.

If this project succeeds, he will have successfully established himself in Hollywood.

Even though this requires him to exercise for no less than 5 hours every day, he has no complaints.

Although this was his first time meeting producer Lü Rui, he had long admired her!
He is a recipient of the grand slam of the three best directors in Europe, and he also served as the producer and screenwriter for the recently released blockbuster "I Am Legend".

This is a producer from China who enjoys a very high reputation in Hollywood and is extremely talented!
He dared not be negligent in the slightest, and always maintained a respectful and friendly attitude.

The others were mostly the same; when they came over to greet us, their eyes were burning with enthusiasm.

In Hollywood, top producers hold a higher status than directors, and Lu Rui is undoubtedly considered one of the "top" in the eyes of many!
The success of "I Am Legend" made him famous!

If these two projects succeed again, his status in Hollywood will undoubtedly skyrocket!
Lü Rui did not disturb him further.

After learning about the progress of the two projects worth hundreds of millions of yuan, he returned to the company and began a new round of "audiences".

This audition wasn't for actors, but for directors.

He needs to find a suitable director for Twilight...

(End of this chapter)