Giving the movie a full release pretty much doubles the production cost, since that’s about what you have to spend to market it. They must have decided that it wasn’t worth it.
Shoving the movie onto streaming with little fanfare seems free, but the problem with that is you can’t write it off as a business loss. So if the movie isn’t projected to make a certain percentage of its cost back, then it’s more valuable to delete it and get the writeoff.
All of this seems strange to me though because we know that many major corporations don’t destroy huge amounts of product just to mark it as a loss, and still end up paying virtually zero taxes. Is a movie studio unable to take advantage of the tax code the way Nike, FedEx and General Motors all can?
Giving the movie a full release pretty much doubles the production cost, since that’s about what you have to spend to market it. They must have decided that it wasn’t worth it.
Shoving the movie onto streaming with little fanfare seems free, but the problem with that is you can’t write it off as a business loss. So if the movie isn’t projected to make a certain percentage of its cost back, then it’s more valuable to delete it and get the writeoff.
All of this seems strange to me though because we know that many major corporations don’t destroy huge amounts of product just to mark it as a loss, and still end up paying virtually zero taxes. Is a movie studio unable to take advantage of the tax code the way Nike, FedEx and General Motors all can?