The Economics of the Movie Business

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Despite the many changes transforming the movie business, the Hollywood studio system has managed to adapt. The industry continues to make money, whether it’s through producing movies, distributing them (through channels such as movie theaters and home-video sales), or exhibiting them (for example, in theaters or through downloads from the Internet). But to remain profitable, industry players must also invest money—including paying for creative talent, postproduction tasks such as editing, and construction of theaters.