Publicity was a huge part of the cost of other movies. That would also affect the film's final income.
The producers and distributors of certain movies loved to sign the valuation adjustment mechanism agreement. For example, the producers would authorize the film's guaranteed distribution rights at a total box office of one billion yuan. That way, the producers could directly obtain more than 300 million yuan in guaranteed income.
The advantage of doing so was that the producers could take less risk. Even if the movie box office failed miserably and lost all of their hard-earned money, these losses would be borne by the distributors, and the producers could still obtain more than 300 million yuan from the distributors.
However, if the box office of the movie exploded and exceeded one billion yuan, only a small portion of the money would be given to the producers and the bulk of it would be taken away by the distributors.
