Oscar-impact on box office of films like The Hurt Locker

In this video Hollywood.com's Paul Dergarabedian examines the Oscar Awards' impact on revenues for a movie like The Hurt Locker. Listen to the video and think of how a movie’s fortunes are changed by an Oscar nomination and a Best Picture Oscar Award.

The best way to explain how a Best Picture Oscar can change the box office fortunes of a film can be found from the experience of last year’s Oscar Best Picture winner Slumdog Millionaire that had a limited release in North America on 12 November 2008, followed by a nationwide release in the United States on 23 January 2009. The film grossed only $360,018 in 10 theatres in its first weekend. In the second weekend, it was released in 32 theatres and made $947,795. The film largely depended on strong word-of-mouth promotion by viewers as the promotional budget of the film was negligible. The film was widely released on 25 December 2008 at 614 theatres and earned $5,647,007.

But following its Best Picture Academy Award (and seven others), the film's takings increased by 43 per cent, which was the highest for any film since Titanic. In the weekend of 27 February to 1 March 2009, the film reached 2943 theatres grossing over $140 million at the North American box office alone. As of the time of this post the Slumdog Millionaire had worldwide gross revenue of $377,417,293 with domestic revenue of component of $141,319,928 (37.4%) plus foreign takings of $236,097,365 (62.6%). Additionally, the film was released on DVD by Blu-ray in the United States and as of 12 November 2009 an estimated 1,964,962 DVD units were sold earning $31.32 million in revenue.

At the time of the announcement of Oscar nominations on February 2, Avatar was the highest earner among the Best Picture nominees with $706 million in domestic box office receipts, but as of now, it has domestic earnings of $714,464,000 (28.0%) plus foreign revenue of $1,839,000,000 (72.0%) making the worldwide box office revenue $2,553,464,000. If Avatar wins the best picture award, watch for the rate at which it will gain at the box office. Even if it loses out to The Hurt Locker or any other film, Avatar is bound to garner some of the important Oscar trophies out of the 9 nominations, and it will still boost its box office takings.

In the case of The Hurt Locker, at the time of announcing the Oscar Best picture nominations, the Iraq war film made at a budget of $11 million had taken in revenue of $12 million. Now it stands at domestic $12,671,105 (65.6%), and foreign $6,656,139 (34.4%), totaling worldwide revenue of $19,327,244. These are very small figures compared to what you have for Avatar till now, or Slumdog Millionaire after the Oscar Awards of 2009. But, if you watch for, definitely, The Hurt Locker’s fortune will make a quantum jump if it wins the Best Picture Oscar.

Also, compare the figures for Avatar and The Hurt Locker in terms of percentages worldwide out of their total revenue. Avatar earned only 28.0% from domestic market but The Hurt Locker earned as high as 65.6% of its revenue from domestic market, and it earned only 34.4% from the foreign market, against Avatar’s 72% from foreign market. Two reasons can be attributed to this vast difference: firstly, in the US, it being a war movie involving American forces and the terrorists or foreign forces, it will be acceptable to the audiences, but for the audiences outside the US, Iraq is a human tragedy, born out of miscalculations, and Avatar had a huge promotional budget and the theme was acceptable, especially for the younger generation and The Hurt Locker could not enjoy the luxury of such a huge budget and it had a limited foreign release.

Any way, if the Best Picture Oscar goes to The Hurt Locker or Precious (budget: $10 million, gross revenue: $50,867,591), these films are bound to have a big rerun and the revenues are going to jump many fold. The Academy Awards and all the run-up to the final award night is a big business in itself, including for the big fashion houses and designers that run all the way to dress up the celebrities out there for all the Oscar events.