Hollywood Goes Global
H OLLYWOOD MOVIES HAVE always been a quintessentially
American product. Globalization, however,
has changed the economics of the movie industry.
Foreign ticket sales for Hollywood blockbusters made
up 50 percent of worldwide totals in 2000. By 2012,
they had jumped to over 70 percent. Of the total
$35 billion that Hollywood movies grossed in 2012,
over $24 billion came from outside the United States!
Today, largely due to the collapse of DVD/Blu-ray
sales, Hollywood would be unable to continue producing
big-budget movies without foreign revenues.
Foreign sales can make or break the success of
newly released big-budget movies.
Look at Exhibit 10.1 , which depicts the lifetime revenues
(domestic and foreign) of recent Hollywood blockbuster
movies. Avatar is the highest-grossing movie to
date, earning over $2.7 billion since its release in 2009.
It may surprise you to learn that non-U.S. box office