Hobbit Battle of Five Armies teaser

A movie’s budget has little correlation to success or quality. Films that costs just tens of thousands of dollars have gone on to great success; probably more films that cost tens of millions of dollars have failed horribly. It’s when films that cost hundreds of millions of dollars fail horribly that studios start worrying about their well-being.

But you have to spend money to make money and audiences today demand spectacle. Despite that demand, they also need it to be sold to them. So a film that costs $250 million might end up costing $500 million once the studio pays for TV commercials, billboards, press junkets and more. It’s a crazy, crazy business and there’s always a gamble even on the biggest properties.

When Warner Bros. decided to make J.R.R. Tolkien’s The Hobbit into movies, the gamble was a little smaller. Peter Jackson had already turned three Lord of the Rings movies into massive hits and a return to Middle Earth would certainly attract audiences. However, with a decade or so of new technology to work with, those movies were going to be expensive. They were going to be even more expensive when the decision was made to do not two, but three films in the series. Now, with the third film on its way to theaters, we have an idea of what that commitment cost. It is historically staggering. Read more about The Hobbit budget below.

A new article on The Hollywood Reporter says that, as of March 2014, the budget for The Hobbit Trilogy was $745 million. That’s still with most of post-production to complete on the third film so, when all is said and done, The Hobbit budget will probably be closer to $800 million.

We know this because when making the films, Warner Bros. created a secondary company to finance the films and their records are public. (Studios rarely make the official budget of a film public.) The Associated Press made the initial discovery.

$745 million for three movies is crazy. That’s almost $250 million each before marketing. According to estimates, that would make the films three of the 15 most expensive in the history of cinema.

That doesn’t matter because, with the first film, the return probably came close to paying for all three films. 2012’s The Hobbit: An Unexpected Journey grossed over $1 billion worldwide. Add 2013’s The Hobbit: The Desolation of Smaug to that – another $958 million – and it’s pretty safe to assume that every red cent that’s grossed on this year’s The Hobbit: The Battle of the Fire Armies will be profit, free and clear. (Or as free and clear as movie grosses are. It’s obviously much more complicated than that.)

So where does The Hobbit Trilogy budget of $745 million (and counting) rank among other expensive Hollywood trilogies? Looking at The Numbers.com, it ranks #1 but not by as much as you’d think. (Note: This isn’t a definitive list. Just an idea.)

  1. The Hobbit Trilogy – $745 million
  2. The first three Pirates of the Caribbean movies – $650 million
  3. The Dark Knight Trilogy – $610 million
  4. Sam Raimi’s Spider-Man trilogy – $597 million
  5. The Chronicles of Narina trilogy – $560 million
  6. Iron Man trilogy – $556 million
  7. The first three Transformers movies – $556 million

Jackson’s Lord of the Rings trilogy cost only $297 million, but factor in inflation, 3D and 48 fps, and more digital work, and you see why it would double for this film.

However, The Hobbit will almost certainly be eclipsed when the next trilogy of films goes into production in New Zealand: James Cameron’s new Avatar sequels. That original film was rumored to cost $400 million on its own.

Are you surprised at The Hobbit budget?

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