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Zeitgeist - Cost of Movie

Peter Joseph (creator of Zeitgeist) believes that I'm mentally ill because I disagree with him. You can read all about it on his forums (linked from this forum post), with a blog-based rebuttal here. You better not disagree with him, or you'll be labeled insane next. Perhaps I'm crazy for pointing out his forum post?

Lately I have seen a lot of people talk about how "the movie is given away for free!" and that "it's only $5 for a DVD, so they don't make any money." In fact, here's an example:

The movie is offered free to watch, but it's hosted at Google, with no cost to the creator of the film for hosting. But does it really cost $5 to make a DVD and $2 to ship it? Well, if one really thinks about it, it does not make much sense, and here is why:

Let's say I want to buy a pack of 100 DVDs, you can find many different prices but I selected the average pack at Newegg.com, and the cost is $27.99[1]. That means that each DVD costs $0.279, or $0.28. 

As for shipping, on the DVD ordering web site, the cost is $2 for shipping[5]. Is that really the case? The weight of a pack of 100 DVDs is roughly 1820g or 1.82kg, or 4.01lbs for the metrically challenged[2]. Given the approximate weight of a 100 disk spindle, you can find that the average weight of each DVD is around 18.5g or 0.065 ounces. Let's say that Peter Joseph is in Los Angeles and wants to ship it to New York City, the cost of that is $0.62[2]. I base this on the fact that the DVD ordering page says that "Each DVD comes in a simple white sleeve." and that he says he uses USPS to ship the DVDs[5].

So if we take the cost of the DVD and the shipping of said DVD, we get ($0.28 + $0.62) = $0.90. Interesting results.

The Numbers Game

But why is this so interesting? Well it's because Peter Joseph claims to make no money off of this DVD: "WE OFFER THIS DVD AT A NON-PROFIT"[5] "[was] created as Not-for-Profit expression..." [6]. While $6.10 profit ($7.00 - $0.90) may not seem like a lot per DVD. If we take into account the entire pack of DVDs, we get $610 profit per stack of DVDs.

I don't know how many DVDs Peter Joseph has sold, but with tens of millions of fans, it's not hard to imagine a decent amount has been sold. In the whole scheme of things this is a simple chart to help detail the potential profit for Zeitgeist and Zeitgeist: Addendum sales:

100 DVDs = $610 profit
1,000 DVDs = $6,100 profit
10,000 DVDs = $61,000 profit

If one is buying a lot of blank DVDs, you can buy them wholesale for much less than what you can find at Newegg or Walmart. Regardless of sales, in the end, Peter Joseph is making a nice profit off of these DVDs, despite what he says. Considering the movies are all footage taken from other videos or are really easy to make with Adobe Premier on a home computer, it isn't hard to imagine Peter Joseph having the profit motive to make this movie. And with the excuse of "giving it away for free", he has even less reason for people to suspect him of anything than good intentions.

Let's look at this from a different perspective. The federal minimum wage in the United States is $6.55 at this time, and with a standard 40 hour work week, not counting holidays, we get: $12,576 before taxes. So, for every 10,000 DVDs Peter Joseph sells, he makes almost 5 times (4.8) what the average minimum wage worker in the US makes in an entire year[4].

So much for $5 per DVD plus $2 shipping, I wonder if he'll change the price of his DVDs once more people know about this?

Third Party Theory

A few people have gone out of their way to contact me to tell me how my analysis on this page is incorrect:

"Have you considered the time factor it takes to create DVD's? Creating 10,000 DVD's would take an amazing amount of time unless you purchased vast quantities of DVD burners. He's probably hired a third party to both copy and ship the DVD."

First of all, my argument was that it doesn't cost $5 to make a DVD and it does not cost $2 to ship it. It seems as though some people are unwilling (perhaps unable) to read correctly. Second, the argument he could have used a third party to make and ship the DVDs has a few problems with it.

Starting with the fact that I've already shown it costs a mere $0.28 to create a DVD, even with let's say $1.00 overhead, a $1.28 per DVD still leaves $3.02 (before shipping) per DVD. So, that really doesn't make much sense. If Peter Joseph is actually having someone else make these DVDs for him, he should really look into the fact that they are making $60K off every 10,000 sold, and he's still pretending to get nothing. This goes exactly what he speaks against on his page, that nobody is allowed to profit from the film[5].

Even so, what kind of distribution company uses standard USPS mail with a tiny sleeve to ship media? Most companies require their media mail (DVDs, CDs, VHS, etc) be shipped via media mailer, which can cost about $10, but this doesn't do it.

So it really comes down to either Peter Joseph is making a killing off of DVDs or the person he trusted to make and ship them is. However, there's another problem: why, if someone else is making them and shipping them, would they use paypal to charge people for it? You mean to tell me he pre-ordered thousands of DVDs out of his pocket and is selling them at cost? Even if that's the case, he's still charging way too much for shipping.

This all doesn't really add up. It basically comes down to people wanting to believe that Peter Joseph created and is selling this film out of the goodness of his heart, and is thus not making any money. Well, he is. If he actually, honestly isn't, then he's should be aware that the company that's making these DVDs for him and shipping them is charging far more than any other distribution company.

Perhaps we're used the idea of DVDs costing $20 at Wal-Mart or CDs costing $12, but the fact is, it only takes a few cents to create these things -- they just charge a boat load for them. To create 10,000 DVDs with a single DVD duplicator or a DVD/RW in a computer would take about 500 hours, or 20 days, so it's conceivable he bought a nicer CD duplicator -- or if he did get someone to duplicate them for him, he would only pay a maximum overhead of $1 or so, probably not even that.

If you want to believe that he's not making any money from $7 per DVD, then go ahead, but please stop contacting me about it.