How do movie studios know that cinemas are paying them correctly?

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Movie studios get a percentage of ticket sales. How do they know that cinemas, especially small independent ones, are reporting their ticket sales correctly? Couldn’t a cinema just claim that a screening had 20 paying viewers when in reality they sold 300 and keep the entire extra revenue for themselves? Or do cinemas have to pay per screening regardless of how many people are in the cinema?

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Anonymous 0 Comments

Been working in cinema for 13 years. Worked at a cinema, a film festival, and now I work in distribution.

The short answer is that they don’t. There is a lot of automatic reporting solutions out there. However there’s nothing stopping a cinema from running a movie “manually”, that is, bypassing any theater management system or ticketing software by just loading up the movie in a projector and running it. The projector is designed to work offline, so as long as you have a valid decryption key the movie will play. The projector does no reporting back.

I’ve never heard about a cinema getting caught fudging their numbers. However, quite often a cinema will put up free screenings without consulting us. Like the cinema is 100 years old, so they celebrate with a free screening for the kids. Stuff like that. Since we get paid a % of the ticket price, this is obviously not OK. So part of my job is finding out about these screenings and invoicing cinemas.

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