Oscars Gold - Part I | The Media C-Suite

As the Academy of Motion Picture Arts & Sciences begins final preparations for the 97^th Academy Awards ceremony, the Media C-Suite presents its annual review of the values, and value, of the Oscars.

Part I

One thing that unites all great performers is the fundamental view that, “the show must go on!”

Despite disruptions caused first by the “streaming wars”, then by Covid-19 and now by generative AI and direct-to-consumer content distribution, the cinema has endured.

For over a hundred years, the production and delivery of motion pictures as both entertainment and culture has motivated the simultaneous adaptation of technology and craftsmanship. That motivation is at once driven by the very human need to share stories and a desire to profit from the telling of them.

This has resulted in a global industry that will collect more than US$3 trillion in annual revenues this year. Perhaps more important, this industry educates, informs and inspires a global audience that today transcends nationality and generation and which has grown to as many as 5.6 billion internet connected humans around the world.

Through it all, our global industry remains synonymous with the artists and technicians that still call its earliest shooting locations home: Hollywood.

Despite the devastation of the wildfires that have ravaged homes and lives around that legendary sign, the 97^th annual Oscars ceremony will be broadcast live on March 2, 2025 from the Dolby Theatre in Hollywood.

For an industry that mines creativity and talent, it’s comforting to know that there’s still gold in them thar hills.

Although the official Oscar nominations were only announced on Thursday, January 24^th, we already know the winner in at least one category:

And the Academy Award for Best Performing Investment goes to …

The Academy of Motion Picture Arts & Sciences, AMPAS to its accountants but just the Academy to its members, has been in the business of promoting Hollywood for nearly a century. Since 1929, it’s Academy Awards for outstanding contribution to the quality of the motion picture has been the benchmark for Hollywood glamour and celebrity.

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How Much Does It Cost to Win Best Picture? Breaking Down the Biggest and Smallest Budgets

Sweeping films, epic stories, stacked casts, and ostentatious budgets—these are some of the things that may come to mind when moviegoers imagine Best Picture-winning films. But is that perception always reflected by reality? Not necessarily.

Technically a US Non-Profit Organization, the Academy and its affiliate group drives a hugely profitable international business model based on the consumption of an increasing amount of human leisure time that results in a global Media & Entertainment industry (“M&E”) with annual revenues expected to exceed US$3 trillion this year according to PWC’s 2024 estimate.

To put that into context, M&E generates nearly 5 times the revenues annually than the top 100 military arms manufacturers combined (cir. US$632 billion/2023).

If M&E were a nation, unto itself, it would rank as the 7th largest economy in the world.

Much of M&E’s success lies in the Academy’s century of effort to promote innovation in content production technologies, increase demand for entertainment content and encourage the public’s consumption of a now pervasive celebrity culture.

That effort has been quite profitable.

Since the 1950s, the glamour of ceremony presiding over the year’s best in Box Office offerings has been largely capitalised by television audiences. Those core efforts to reinforce public appetite for the US Box Office has evolved into a global celebrity creator-culture, pervasive internationally, across film, television, music and now original content at the heart of the ongoing “Streaming Wars”.

The Academy’s membership is today a cross-section of the M&E industry, including all modes of media and content, from film to TV series, music, technology, marketing and management. After 96academy years of effort, the Academy’s roughly 10,000 present members preside over a promotional organisation spending roughly US$50 million a year to support US$3 trillion in industry revenues.

By any measure, that is a great investment.

In the process, the Academy itself has amassed considerable value in its own right.

But just how much is the Academy worth?

According to PwC’s audit of the Academy of Motion Picture Arts & Sciences’ consolidated financial statements for 2023 and 2022 (its most recently published official accounts) the Academy has accumulated total assets valued at over US$1.3 billion.

In the lead up to this year’s annual Academy Awards, let’s take a look at three key numbers behind the Oscars.

US$146.6 million

The Academy’s annual awards revenues reached US$146.6 million from last year’s event, according to financial statements published with the Municipal Securities Rulemaking Board. Up slightly over the 95th Academy Awards in 2023, which reached US$143.46 million, and up significantly from 2022’s US$137.1 million and 2011’s US$84.2 million.

The cost?

US$56.87 million in 2023, including salaries and benefits, with a net profit of US$86.68 million for the 95th Academy Awards.

With last year’s audience of 19.5 million in the U.S. standing at a fraction of what they were ten years ago (40.38 million American viewers in 2013, according to Nielsen), a multi-year domestic television licensing deal with ABC, plus international licensing of the event to Buena Vista, provides significant protection against declining viewership. For the next three years, that is. The deal with ABC runs through to the Oscar’s 100th anniversary in 2028.

US$856.7 million

The value of the Academy’s total net assets rose by US$67.53 million above 2020’s US$789.2 million.

That’s due in large part to investing nearly all of its annual revenues with no distributions and no tax. The value of its investment portfolio has more than tripled in the last decade

Holding a diversified investment portfolio, the Academy’s investments into equities and alternatives, including managed funds, reached US$690.1 million in 2023, up from US$635.3 million in 2020 and significantly higher than the US$163.2 million in 2011.

We’ll know more about the Academy’s 2024 results after its fiscal year end on June 30th.

US$545.5 million

The Academy’s total property value declined from US$589.8 million in 2021 to US$545.5 million in 2023 with its primary property being the Academy Museum.

Nearly a decade in the works, the Academy Museum of Motion Pictures, near Beverly Hills, opened its doors in September, 2021 with construction costs nearing US$535.5 million as of June 2021.

The museum earned nearly US$18 million in revenues from ticket sales, retail sales, sponsorships and event rentals in 2023, down from US$23.7 million in 2022.

Designed by Renzo Piano, the Pritzker Prize winning architect, this 300,000 sq.ft. glass highlighted landmark is intended to be a global destination for the film aficionado and for the next generation of film-makers.

With over 13 million objects within several curated collections, the Academy Museum is expected to offer both wonder, nostalgia and an education on the development of motion pictures from silent film to tomorrow’s virtual experience.

What Next for Oscar?

The stated purpose of the Academy, being to promote outstanding contributions to the quality of the motion picture, as not changed in nearly a century.

Live viewership over linear television and convergence between theatrical and streaming distribution may force changes in the presentation of the Academy Awards over the coming years. But the Academy’s financial resources, and its growing international reach, provide more than enough capability and capacity to continue its mission to support the Media & Entertainment industry, if not exclusively through the Box Office.

So long as story-tellers merge art and science into motion pictures to entertain ever growing audiences, on whatever screen they choose, it’s a safe bet that Oscar will be there to reward them.

In Part II, we take a look at how the Academy has amassed its considerable resources.

In Part III, we’ll speculate as to why. Part III will published shortly.

Stay tuned.

Thomas Kingston

Thomas is our founder, acting Publisher and contributes an outsized proportion of our articles and editorial pieces.

He is an American lawyer & private equity specialist with 30+ years of international experience in investment strategy. He has lived and worked in London, Dubai, Abu Dhabi and Nicosia as both adviser and executive to several of the world’s largest family offices, institutional investors and State-investment companies. He is also founder of Coherent Media Group, a corporate holding company dedicated to media & entertainment businesses globally.

In his spare time, Thomas is a corporate and political speech-writer and has ghost-written numerous Op-Eds, political/espionage thrillers and science fiction novels.