Economy, Domestic Economy

Is Iranian Film Production a Profitable Enterprise?

During the first half of the current Iranian year (March 21-Sept. 22), Iranian cinema’s return on investment grew by 21% over last year’s similar period
Is Iranian Film Production a Profitable Enterprise?Is Iranian Film Production a Profitable Enterprise?

While movie production companies across the world, particularly in Hollywood, are more than eager to announce their film’s budget to create a buzz and signal its quality, in Iran these figures are rarely announced.

So, it is not clear whether a movie has made a profit or a loss against its production budget.

Those in Iran’s film business are mostly in the habit of grumbling about the lousy economics of their business, repeating the famous saying that Iranian cinema is nothing more than “a labor of love” for those involved. However, TV series producer, Mehdi Golestaneh, believes otherwise, Bourse24 reported.

“Cinema and TV drama production are the first and second most profitable businesses in the world,” he said.

“The return on investment of show business in Iran was 47% in March 2016-17. This is while the stock market registered a 3% decline in the same year. The interesting point is that during the first half of the current year (March 21-Sept. 22, 2017), Iranian cinema’s ROI grew by 21% over last year’s similar period.”

Iranian movies are generally classified into three groups, based on their budget.

Low-budget films are shot with little funding, without featuring well-known actors, and are usually about family or social issues. These films have a budget of around 2-5 billion rials ($50,000-125,000) and might have a limited release in theaters, according to the Persian daily Cinema.

The second group of Iranian movies includes the mainstream film circuit that features well-known actors. They usually feature a city as a setting for the story where characters live in apartment buildings. These films are usually produced on a budget of 12-18 billion rials ($300,000-450,000).

Mega-budget movies are the third group of Iranian movies. They usually include the so-called genre of historical period drama, in which stories are based on historical events and famous people. Government-run organizations main produce and sponsor such movies. The cost of making such big-budget films varies from 80 to 600 billion rials ($2-15 million).

A film’s production budget includes all costs incurred during pre-production, filming, post-production and promotion. That includes buying the rights to the script, actor’s salaries, production staff salaries, set construction, special effects, wardrobe, technical services and marketing.

Iranian mainstream movies, the focus of this writing, are mainly produced by companies belonging to the private sector. The lion’s share of production costs of an Iranian mainstream movie goes to actors’ salaries.

Filmmakers prefer to reduce the risk of bombing on the box office by pursuing proven formulas, one of which is using professional, famous actors. Celebrated actors receive up to 3 billion rials ($75,000) for a lead role and usually have the final say in the film’s production.

Film director’s salary also makes up a huge chunk of movie budgets, depending on the person’s reputation.   

Below, four Iranian mainstream movies have been picked, of which three have done very well and returned the cost of production.

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