December 05, 2016

The Academy Awards Costs How Much?

86th Annual Academy Awards - Arrivals

By ROBERT W. WELKOS
In the days before this year’s Oscars show, Cheryl Boone Isaacs, president of the Academy of Motion Picture Arts and Sciences, released the nonprofit organization’s annual report and it was enough to raise some eyebrows to learn:

–The Academy’s total assets in 2013 amounted to $488.8 million—up from $363 million the previous year.

–The Academy’s net assets soared 29% from $299.5 million to $385.3 million.

–The Academy’s revenues totaled $134.4 million, including $93.7 million from the Academy Awards and related activities.

–Expenses in 2013 totaled $97.3 million.

And, the annual report also discloses that the Academy spent nearly $40 million on the Academy Awards and related activities.

To be precise: $39.7 million.

Now, compare the cost of the Academy Awards to the reported production budgets of three of this year’s best picture nominees:
“Dallas Buyers Club”: $5 million.
“Nebraska”: $12 million.
“Her”: $23 million.

In other words, these three films, taken together in a clump, were made for about what it cost to put on 2013’s Oscar extravaganza and everything that goes along with it.

Money seems to be no object when it comes to the Academy.

When he was nearing retirement in mikd-2011, the Academy’s long-time executive director, Bruce Davis, was pulling down more than $1 million a year in compensation.

According to tax filings for fiscal 2009-2010, Davis actually earned $1,191,388 in compensation and an estimated $180,851 in other compensation.

Oscars Leo DiCaprio 2014 600x758

Of course, the Academy can boast that it has something tangible to show for all the cash it spends.

Despite so-so reviews, viewership of ABC’s telecast hosted by Ellen DeGeneres jumped 6% over last year, making it the most watched Academy Awards in a decade.

That fact alone will surely keep the cheering section going for Isaacs and Academy CEO Dawn Hudson, who together oversee the venerable 6,000-member organization along with the Academy’s Board of Governors.

But can they keep the show culturally relevant when the whole way people can watch movies in transition and everyone, to a degree, becoming stars of their own productions on social media?

Jeanine Basinger, who chairs the film studies department at Wesleyan University in Connecticut, believes the people who launched the Oscars back in the late Roaring ‘20s and nurtured the ceremony through the Great Depression, World War II and on through more recent times, wouldn’t recognize the Academy Awards today.

“They’d be appalled because it’s now so much about fashion, and there are now people who are giving out awards who aren’t movie stars, they’re TV people, and all these musical numbers and people getting pizzas delivered in the front row—I mean, that was funny,” Basinger told HollywoodNews. “(Still) they would be proud that it’s become so international, so big, and earning so much money for the Academy.

“…I am curator of the Frank Capra archives and he used to talk about the beginning of (the Oscars),” Basinger added. “He said this was something the industry designed for the industry itself. It wasn’t about what the fans thought was the best film, or what the media thought, or what the critics thought….They would look at this (today) and ask, ‘Have we lost our way somehow?”

Even the Governors Ball, which is put on for the nominees following the Oscars telecast, doesn’t come cheap.

In fiscal 2011, for instance, the Governors Ball cost the Academy $1.9 million, according to the Form 990 tax documents the nonprofit filed with the IRS.

At this year’s Governors Ball, celebrity chef Wolfgang Puck served up chocolate Oscars covered in edible gold dust.

This financial largesse doesn’t surprise Jim Piazza, the co-author with Gail Kinn of the book, “The Academy Awards: The Complete Unofficial History.”

“It’s the way of the world,” Piazza told HollywoodNews. “In ‘Iron Man 2’, Robert Downey, Jr. made $40 million for basically three months work. There’s something immoral about that.”

Piazza said he looks at the Academy Awards as something akin to being invited to watch a convention of really attractive people. “It’s all about them. It’s all about ego. There’s a lot of inside jokes.”

And, let’s not forget, he stressed, the Academy Awards is all about selling movie tickets.

The Oscars keeps getting bigger. Why? Well, public curiosity certainly plays a role. So does the glamour of the red carpet. And then there’s tradition. “There’s a certain nostalgia attached to it,” Piazza says, much like baseball’s World Series. A lot of people who don’t watch baseball during the regular season make it a point to watch the World Series even though they don’t know much about who’s playing.

And, of course, there’s the competition itself. “I think Americans love the horse race,” Piazza said.

But what about the future of the Oscars. Will ensuing generations want or even care who win’s best actor or which film is named best picture?
“I teach 18 and 20-year-olds,” Basinger said. “I talk to them every day about movies. They don’t pay much attention to the Oscars and these are people who are really serious about movies. They watch movies constantly day and night…but they are never talking about the Oscars. Oh, one or two of them might be interested. So, if they’re not interested now, why are they going to be interested when they’re old? I think the Academy is really going to have to think about it.

“…In my world (academia), nobody watches it. I’m on a college campus and…my God, of course, the faculty doesn’t watch. They don’t watch anything. Most of my students don’t watch. Even 10 years ago people may have given an Oscar party. Nobody does that anymore. (So) who are all these people watching?”
Television changed everything for the Academy Awards, she said.

“One of the problems, of course, is that once they started doing it on TV, it had to be about doing a television show.”

But the novelty begins to wear off, particularly when the Oscars now come at the tail end of a long, exhaustive awards season in which the same group of actors and directors seem to be picking up awards and saying the same things when stepping up to the microphone to accept.

How many times do we need to see Matthew McConaughey, Cate Blanchett, Jared Leto and Lupita Nyong’o give what amounts to the same acceptance speech over and over again?

Also, fashion today plays such a huge role at the Academy Awards.
“Ten or fifteen years ago, there was no red carpet,” Piazza said. “People just went from their car to the door.”

Now, there’s not only the red carpet parade but all the actresses are draped in designer gowns and there’s this elaborate gauntlet of camera flashes and stopping to chat with one TV interviewer after another before entering the Dolby Theatre.

But the red carpet has come with a price. So many of the actresses look so similar.

“Now we don’t see them in hilariously terrible outfits,” Basinger said. “Now, they’re all dressed by somebody and so you don’t have a sense of their own personality in their own clothes.”

Critics, of course, note that the show itself seems in danger of drifting away from its original intent—the celebration of the year’s best in filmmaking.

Basinger said that when she reads that a great percentage of Americans haven’t even seen a single one of the nine best picture nominees this year, she has to wonder what it means? “You’d think at least people would go see ‘Gravity,’” she said.

But it isn’t about the movies so much as it’s about fashion, who’s the emcee, the opening monologue and if there are any dance numbers. “It’s getting further and further away (from it’s original intent),” Basinger said.

And, besides, the show is usually so boring that people must wonder why they stayed up to watch? But watch they do.

This year’s show gave viewers some tasty anecdotal morsels to chew on that should keep us laughing and shaking our heads for years to come.

There was John Travolta’s strange flubbing of singer Idina Menzel’s name—calling her Adele Dazeem.

There was Oscars emcee Ellen DeGeneres giving Samsung a product placement publicity bonanza by orchestrating a star-crowding selfie on Twitter.

And, of course, there was Ellen ordering pizza for all the stars seated up front.

But the question remains, why does it take $40 million to put on the Oscars?

In 2012, according to the Academy’s tax filings, Oscar-related expenses totaled $37.5 million. That was up from $21.7 million the previous year and $20.4 million the year before that.

Providing security doesn’t come cheap in a post-9/11 world. In 2009, for example, the Academy’s security totaled $2.2 million.

But even that is illustrative of how the nonprofit organization’s expenses have mushroomed over the years.

Take 2007. That year, the Academy spent $227,795 for awards screenings, $194,473 for the nominees’ luncheon, $168,434 for the nominees’ announcement; $162,470 for press relations; $77,623 for the New York awards ceremony and $40,469 for the London awards ceremony.

Salaries and other administrative costs are always a major expense at organizations as large as the Academy. In 2013, the Academy spent $23.6 million on general and administrative expenses.

The Academy operates a noted archive and library and has established a Sci-Tech Council as well. In 2013, it dispensed grants totaling $450,000 to film festivals, $325,000 for education initiatives and $175,000 for internships.

The Academy also has grand visions of opening a motion picture museum in 2017 in the old May Co. building at the corner of Wilshire and Fairfax. The $300 million capital campaign already has $200 million in donor commitments.
Basinger believes a motion picture museum is long overdue.

“I do think having an American museum about the history of Hollywood and American movies is a very good thing and important thing,” she said. ”Our film industry is the finest film industry in history. Because of World War II, many of the greatest filmmakers from other countries came here to join it. The whole thing should be a wonderful museum. I think it would be an enormous draw.

“They’ll probably charge a $40 entrance fee,” Piazza quipped. “It’s not going to be free.”

Photo by PRPhotos

About Robert W. Welkos

Executive Editor: Robert W. Welkos is an award-winning journalist who covered the entertainment industry for 15 years as a staff writer for the Los Angeles Times. During this span, he wrote extensively about the movie industry from turmoil in the executive suites, the Academy Awards and Golden Globes, and box office hits and bombs to visits to movie sets as well as profiles of top stars and A-list directors, cutting edge features on the newest indie films and visits to famous film festivals like Sundance and Cannes. Prior to entertainment, Welkos worked as a reporter and assistant city editor in The Times’ Metro section where he undertook major investigations for the paper as well as covering breaking news and writing in-depth features. Before joining The Times, he worked for the Associated Press in Reno, Nevada, and City News Service in Los Angeles.

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