The level of spending on ‘The Marvels’ has been highlighted by the significantly lower budget of … More
Courtesy of Marvel Studios
Marvel Studios’ president Kevin Feige claims he has found the magic formula for making cheaper movies and he wants everyone to know about it.
Earlier this week the baseball cap-wearing boss of the super hero studio told Variety that it has been been given tips by the team behind The Creator, the 2023 sci-fi epic which earned an Oscar nomination for its visual effects even though it was reportedly made for a fraction of the cost of a Marvel movie. It has now come to light exactly how cheap it was.
The Creator is set in a dystopian future where the western world is at war with New Asia, fictional region which is under the spell of a rogue artificial intelligence system. An ex-special forces agent played by Tenet’s John David Washington is recruited to bring an end to the battle by hunting down and killing the Creator, the elusive architect of the AI.
Along the way he comes across a potential savior in the form of a child who can control electronics with her mind which eventually saves the day. It was a breakout role for Madeleine Yuna Voyles, a then 7-year-old actress from San Diego who has yet to appear in other major productions.
The most well-known members of the rest of the cast are perhaps Eternals actor Gemma Chan, Ken Watanabe, the Japanese star of The Last Samurai, and Ralph Ineson, who provides the motion capture for the villain in this month’s the Fantastic Four: First Steps. The Creator lacked a line up of big household names which helped its director Gareth Edwards keep costs down.
‘The Creator’ was nominated for an Oscar for its low-budget visual effects © 2023 20th Century … More
20th Century Studios
The movie was also shot on the low-cost prosumer Sony FX3 camera and instead of recreating locations with sets or costly computer generated imagery, Edwards sent a small crew to film in 80 locations using natural lighting and limited sound recording. There’s no need to speculate about the impact this had on the cost.
Interior scenes and stuntwork for The Creator were shot at Pinewood Studios in the United Kingdom and this shines a spotlight on how much was spent on the movie.
The cost of making films in the United States is a closely-guarded secret as studios tend to combine their spending on individual pictures in their overall expenses and don’t itemize the budgets of each one. In contrast, studios filming in the U.K. benefit from its Audio-Visual Expenditure Credit which gives them a cash reimbursement of up to 25.5% of the money they spend in the country.
To qualify for the reimbursement, movies must pass a points test based on factors such as how many of the lead actors are from the U.K. and how much of the production work is done there. Furthermore, at least 10% of their core costs need to relate to activities in the U.K. and in order to demonstrate this to the government, studios set up a separate Film Production Company (FPC) there for each picture.
The terms of the reimbursement state that each FPC must be “responsible for pre-production, principal photography/shooting and post-production of the film; and for delivery of the completed film.” In summary, the FPC’s financial statements have to show the production’s entire costs, not just those incurred in the U.K. Likewise, studios aren’t allowed to hide costs in other companies as the terms also state “there can only be one FPC in relation to a film.”
Each FPC has to file annual financial statements which lift the curtain on everything from salaries and social security payments to the total cost of the production and the level of reimbursement. It takes a bit of detective work to get the information.
The companies usually have code names so they don’t raise attention with fans when filing permits to film on location. Tallying the company names with the productions they are responsible for requires deep industry knowledge which my colleague and I have built up over nearly 15 years reporting on the movie industry. We are the only journalists worldwide who specialize in covering the financial statements of U.K. film production companies for national media and we have reported on them for more than 10 leading titles including The Times of London, The Guardian, The Daily Telegraph, The Independent and the London Evening Standard.
The Creator was distributed by Disney-owned 20th Century Studios and the FPC behind it is named NeoAsia Productions after the renegade region which embraces AI in the movie. NeoAsia Productions is ultimately owned by billionaire Israeli businessman Arnon Milchan who was one of the producers of the movie and founded the production company Regency Enterprises which was also behind it along with Entertainment One. Milchan has been involved with more than 130 pictures including 12 Years a Slave, JFK, Heat, Fight Club and Mr. & Mrs. Smith. The Creator was one of the cheapest.
‘The Creator’ was made for only a quarter of the budget of ‘The Marvels’. © 2023 20th Century … More
20th Century Studios
In 2023 Variety claimed that the movie cost $80 million to make and put it to Edwards. “I’m a bit embarrassed it was $80 million,” he responded. “We should’ve done it for less.” He wasn’t exaggerating.
There were two reasons why Edwards was embarrassed. Firstly, the latest financial statements for NeoAsia Productions reveal it is indeed correct that Edwards should have made the movie for less as they state that its “budget has been exceeded”. They also reveal that it cost more than $80 million to make. Not much more though as the financial statements show total expenditure of $93.5 million (£75.3 million) which was reduced by a $7.5 million (£6 million) reimbursement.
The U.K.’s reimbursement is calculated on up to 80% of core expenditure so in order for a production company to get back the maximum 25.5% of the money it spends in the country, it needs to ensure that at least 20% of its core costs are incurred elsewhere. The Creator had no problem with this and amongst its many filming locations a good deal of principal photography took place in Thailand.
There is no limit to the amount of reimbursement that a production company can receive in the U.K. and that’s not all. In addition to claiming on direct spending in the U.K., studios can also get a pro rata reimbursement on what are known as neutral costs throughout the production such as insurance and payment to senior producers, writers and directors.
These costs can be claimed in proportion to the amount of the activity in the U.K. so, for example, if the spending there represents 22% of the total budget then 22% of the neutral costs will also qualify for reimbursement. Accordingly, the level of reimbursement can rise close to a third of the total costs which is a blockbuster sum.
The reimbursement received by NeoAsia Productions only represented around 8% of its total costs but this still brought the net expense down to just $86 million which is a tiny sum compared to similar movies made by other studios.
Testimony to this, two months after The Creator was released, Disney debuted its own sci-fi flick, The Marvels, which cost a massive $374 million (£307.8 million) to make as this report revealed. It was precisely four times the sum spent on The Creator making it a much bigger gamble, even after a $66.7 million (£54.9 million) reimbursement reduced its expenses to a net $307.3 million.
Neither movie was particularly well-received. Review aggregator Rotten Tomatoes shows that The Marvels earned 62% from critics and 79% from audiences whilst The Creator’s critics score was five percentage points higher and its rating from audiences was four percentage points lower.
In contrast, The Marvels grossed $206.1 million according to industry analyst Box Office Mojo whilst The Creator’s tally came to just $104.3 million. Studios typically receive around 50% of the takings which left The Marvels with an estimated $204.3 million loss at the box office whilst The Creator was only $33.9 million in the red. It’s not a dream ticket but it makes it a lot easier for a film to make a profit in theaters and for Marvel that really is a whole new world.
