Amazon Spends More Than $160 Million On Its Next Big Movie License

Amazon is spending big in the hope of getting a hit movie (Photo by Beata Zawrzel/NurPhoto via Getty Images)

NurPhoto via Getty Images

Amazon has revealed that it has spent more than $160 million on bringing its next major movie license to the silver screen.

Called Project Hail Mary, the sci-fi epic stars Ryan Gosling as a science whizz sent into space in search of a solution to a catastrophe on Earth.

It is set to debut in theaters in March next year and is the latest step in Amazon’s quest to take on Hollywood’s establishment.

Money is no object for the tech giant which paid an estimated $250 million to buy the television rights to The Lord of the Rings in 2017. As this report revealed, Amazon spent more than $800 million on two seasons of spinoff show The Rings of Power which plays exclusively on its Prime Video platform.

The blockbuster spending spree didn’t stop there and in March 2022 Amazon paid $8.5 billion for storied movie studio MGM despite it reportedly being valued at between $3.5 billion and $4 billion.

This gave Amazon access to the studio’s biggest star – James Bond – but it couldn’t freely develop the franchise as longtime stewards Barbara Broccoli and Michael G. Wilson were in charge of the spy series. So Amazon had to whip out its wallet again and handed them an estimated $1 billion to cede creative control.

The license to Project Hail Mary came at a much lower cost and dates back to 2019 when MGM brought in movie producer Michael De Luca to sign up splashy motion picture projects. According to Variety he wrote a check for $3 million for the film rights to the Project Hail Mary novel which was published in 2021. It was written by Andy Weir, author of The Martian, and became a New York Times best-seller thanks to its tense and mysterious plot.

The story sees astronaut Ryland Grace wake up on a spacecraft with no memory of himself or his mission. He slowly realizes that he is the sole survivor of a crew which had been sent to the Tau Ceti solar system to save humanity.

The big screen adaptation is being directed by Phil Lord and Chris Miller, best known for their work on The Lego Movie and Sony’s Oscar-winning Spider-Verse series.

It is the first film Lord and Miller have directed since 22 Jump Street in 2014 as although they were later hired to helm Solo: A Star Wars Story, Disney unceremoniously dropped the duo and replaced them with Ron Howard who carried out extensive reshoots. There is no sign that will be necessary for Project Hail Mary.

The first trailer for the movie was released in June and surpassed 400 million views across social media platforms in just its first week, giving it the record for the most views ever for a trailer of an original movie which isn’t a sequel or remake. No expense was spared on it.

The cost of making movies in the United States is usually a closely-guarded secret as studios combine the cost of separate pictures in their overall expenses and don’t itemize the cost of each one. It is a different story for movies made in the United Kingdom like Project Hail Mary.

Studios filming in the U.K. benefit from the government’s Audio-Visual Expenditure Credit (AVEC) which gives them a cash reimbursement of up to 25.5% of the money they spend in the country. It comes with a catch.

To qualify for the reimbursement, movies must pass a points test based on factors such as how many of the lead actors are from the U.K. and how much of the production work is done there. Furthermore, at least 10% of their core costs need to relate to activities in the U.K. and in order to demonstrate this to the government, studios set up a separate Film Production Company (FPC) there for each picture.

This lifts the curtain on precisely how much it costs to make movies as each FPC has to file annual financial statements. It takes a bit of detective work to get to the bottom of them.

The FPCs usually have code names so that they don’t raise attention with fans when filing permits to film on location. Tallying the code names with the productions they are responsible for requires deep industry knowledge which my colleague and I have built up over nearly 15 years of reporting. We are the only journalists worldwide who specialize in covering the financial statements of U.K. film production companies for national media and we have reported on them for more than 10 leading titles including The Times of London, The Guardian, The Daily Telegraph, The Independent and the London Evening Standard.

Once the code names have been correctly tallied with the films, the financial statements of the relevant FPC can be consulted to reveal how much the movie cost to make. That’s because the terms of the reimbursement state that each FPC must be “responsible for pre-production, principal photography/shooting and post-production of the film; and for delivery of the completed film.” In short, the FPC’s financial statements have to show the production’s entire costs, not just those incurred in the U.K. Studios aren’t allowed to hide costs in other companies as the terms also state “there can only be one FPC in relation to a film.”

The Amazon subsidiary behind Project Hail Mary is called Hail Leo UK Productions in a nod to the title of the book and MGM’s famous lion mascot. As with all U.K. companies, its financial statements are released in stages long after the period they relate to. This starts during pre-production and continues after the premiere to give the production team time to ensure that all the bills are paid.

It explains why the latest filings for Hail Leo UK Productions cover the period up to December 31, 2024, two months after the end of principal photography. The company’s earnings report shows that a total of $168.6 million had been spent on the production by then with its average number of employees last year coming to 163. That doesn’t include freelancers, contractors and temporary workers as they aren’t listed as employees on the books of U.K. companies but often represent the majority of the crew on a film shoot.

As the earnings report was produced 15 months before the release of the movie its costs will increase in the next set of filings. They will show the bulk of the expenses on post production which is typically done after filming ends. However, the government reimbursement will have a magic touch on the picture’s bottom line.

The reimbursement is capped at 80% of core expenditure so in order to get back the maximum 25.5% of the money they spend in the U.K., production companies need to ensure that at least 20% of their core costs are spent outside the country. However, there is no limit to the amount of reimbursement that production companies can receive from the U.K. government and that’s not all.

In addition to claiming on direct spending in the U.K., studios can also get a pro rata reimbursement on what are known as neutral costs throughout the production such as insurance and payment to senior producers, writers and directors.

These costs can be claimed in proportion to the amount of the activity in the U.K. so, for example, if the spending there represents 22% of the total budget then 22% of the neutral costs will also qualify for reimbursement. Accordingly, the level of reimbursement can rise close to a third of the total costs which is a staggering sum.

The earnings report for Hail Leo UK Productions shows that it had banked a total reimbursement of $30.2 million (£24 million) by the end of last year which comes to 19.4% of the costs and brings the net spending on the movie down to $138.4 million. The benefit to the U.K. government is even bigger than that.

The latest data from the British Film Institute (BFI) shows that in 2019, every $1.31 (£1) of reimbursement handed to studios generated $10.88 (£8.30) of additional Gross Value Added (GVA) benefit for the U.K. economy. It led to a total of $10.1 billion (£7.7 billion) in GVA being generated by the fiscal incentives for film in 2019.

Released in December 2021, the BFI’s triennial Screen Business report showed that between 2017 and 2019, the fiscal incentives to studios generated a record $17.7 billion (£13.5 billion) of return on investment to the UK economy and created more jobs than ever before.

In 2019, film making generated 37,685 jobs in London and 7,775 throughout the rest of the U.K. The BFI’s report added that when the wider impacts of the film content value chain are taken into consideration, 49,845 jobs were created in London in 2019 and 19,085 throughout the rest of the U.K.

In February the BFI released its latest annual data which showed that foreign studios contributed around 87% of the $2.6 billion (£2.1 billion) spent on making films in 2024. It remains to be seen how long the U.K. economy will continue to get a glow from attracting American studios away from their home country.

In May President Trump rocked Hollywood with the announcement that a 100% tariff would be applied to movies entering the U.S. that are produced in “foreign lands”. It was an attempt to bring film making back to the U.S. and although it has yet to be implemented, it is understood to still be on the agenda.

Trump’s special adviser the actor Jon Voight recently revealed that a 120% tariff on film and television and strengthened federal and state tax incentives are being discussed at the White House. Unless Trump follows through with this threat to force studios back to the U.S., he will have to roll out the red carpet with incentives for them in order to compete with the U.K.