BUSINESS

Studios Set To Lose $1.9 Billion

03/28/2008 02:45 am ET | Updated May 25, 2011

The Hollywood studios will make a loss of $1.9 billion on the movies they released in 2006, according to the first report from Global Media Intelligence, a new division of media research firm Screen Digest.

The report, titled "Do Movies Make Money?," says that production costs for mid- to big-budget movies have risen much faster than revenues over the past few years, leaving the studios' business model deep in the red.

Analyzing the 132 pics distributed by the U.S. majors in 2006, it estimates a pre-tax operating loss of $1.9 billion after five years of exploitation across all global media. That compares with a profit of $2.2 million for all new studio releases in 2004.

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