Why Hollywood needs a new set of stats to calculate stars’ pay

You could call is ’the Moneyball’ approach
In this image released by Sony Pictures, Brad Pitt, left, and Jonah Hill are shown in a scene from "Moneyball." The film was nominated Tuesday, Jan. 24, 2012 for an Oscar for best film. Pitt was also nominated for best actor and Hill was nominated for best supporting actor. The Oscars will be presented Feb. 26 at the Kodak Theatre in Los Angeles, hosted by Billy Crystal and broadcast live on ABC. (AP Photo/Columbia Pictures-Sony, Melinda Sue Gordon)
Brad Pitt, left, and Jonah Hill in a scene from "Moneyball." (Melinda Sue Gordon, Columbia Pictures-Sony/AP Photo)

Last week’s post about how the budgets for television shows may need to go down in order to adapt to the internet sparked some interesting discussion over on Twitter. The discussion involved films, of course, with one commenter suggesting that A-list actors such as Tom Cruise command huge salaries because they’re proven draws.

That got me thinking: do movie executives really cast their movies based on the drawing power of the actors? Of course they used to, so the better question is perhaps whether they still do? And if so, is it possible to play games with such a system, similar to how baseball manager Billy Beane played “Moneyball” with the Oakland Athletics?

Surely I’m not the first person to have thought of this – it would actually only surprise me if this sort of thing wasn’t widespread in Hollywood.

Beane’s Moneyball strategy, for the uninitiated, was a system of picking players based on non-traditional statistics. For much of its history, Major League Baseball has aligned the value of its players according to traditional stats, like batting average, home runs, stolen bases, earned run average and so on. If one guy consistently hits .300 and 40 home runs, then he’s an all-star who should make big bucks, or so the system has gone.

Beane, however, didn’t have those big bucks to spend with the A’s, so he instead focused on what he felt were more important statistics, such as on-base average and slugging percentage. After all, it doesn’t really matter how a player gets on base – whether it’s through a hit, a walk or even hit by a pitch – because once he’s there, he has the same chance to score a run as a good hitter, which is the only thing that matters in a game that’s decided by one team outscoring the other.

As dramatized in the Brad Pitt film, Beane put together a successful team based on his stats that had no bona fide all-stars, just players who put together solid numbers but were paid modestly. The “Moneyball” strategy has of course had a big effect on baseball since, with many teams now employing statisticians that study such numbers.

The logic seems to apply to movies as well. Over the past year, Tom Cruise was again the highest paid actor, according to Forbes. The illuminating part, however, comes from looking at the magazine’s most overpaid actors list, which calculates the revenue from their last three films against salaries. Right there at ninth most overpaid is Cruise, whose movies earn $6.35 for every dollar he’s paid.

Contrast that with the most profitable actor, Kristen Stewart, whose movies (which have basically been Twilightfilms, so far) earn $55.83 for ever dollar she’s paid.

The two lists are quite obvious when compared. The overpaid list includes established, big A-listers including Cruise’s ex-wife Nicole Kidman and comedians such as Adam Sandler, Will Ferrell and Eddie Murphy. The most profitable list, meanwhile, is made up mostly of young actors such as Stewart’s co-star Robert Pattinson, Daniel Radcliffe and Shia Labeouf.

The major flaw with Forbes’ process is equally obvious when the types of movies the actors star in are considered. People go to see comedies based on the actor/comedian, while not many go to big event movies like Transformers to see Labeouf. Comedy actors thus probably merit higher pay while their movies earn less than blockbusters, which pay their stars relatively little. This skew explains much of the two lists.

Still, the inclusion of dramatic actors such as Cruise and Kidman on the overpaid list does lend credence to the fact that paying an actor large amounts of money to star in a movie is pretty risky, if not foolish. From a financial perspective, it would seem to make more sense to play Moneyball with actors. As long as it’s not a movie that’s completely dependent on the actor’s personality, young players consistently deliver a better bang for the buck.

From a creative perspective, this approach has advantages too. Many writers are likely to say they’d rather have people go see a movie for the story they wrote, as opposed to the actors who are in it, so no-name stars are actually preferable. Who’d have thought the financial and creative sides could find common ground?

So what does this all have to do with the internet? Well, if content production – whether it’s film or television – is going to have to adjust its budgets downward in order to adapt to various internet forces at play, which includes fragmented entertainment spending and piracy among others, creators may very well have to start playing more Moneyball.