[RRW]

Originally Posted by TJR

Deen has nothing to gain from splurging on most productions, hence the continual cost cutting. It's common knowledge that the money a studio receives from the production committee is inadequate to cover costs.

If a studio doesn't invest in a project's production, the result is like this:
Anime is a massive flop = $0 profit, no loss if production is on budget, net less if there are budget overruns
Anime is a massive hit = $0 profit, no loss if production is on budget (rare since it takes extra money to make something nice), net loss if there are budget overruns

They animate Fate/Stay Night as a work for hire contractor with no share of the pie (that was the deal they made for the TV series, and it carried over to the movie). If they were to go overbudget to make something extra impressive, they'd take a net loss even if a million DVDs were sold. In fact, it'd be even better if they produced something under the allotted budget since they'd pocket the remainder, so long as they produce enough hits to lock down future contracts.

The studios that would allow overruns are those who're afraid that lacklustre quality might affect future business (that would probably be most companies) or are betting that improved production values might open up more opportunities. However, Deen has no shortage of work, so......

Naturally, it's a different matter if a studio invests in the production, just as ufotable did (Madhouse and Gonzo did this a lot, and they got into big trouble because of it). The result would be like this:

Anime is a massive flop = significant net loss, especially if they pay a lot out of their own pockets to make the anime really good
Anime is a massive hit = significant net profit, even if they risk a lot of money in the short term

In short, Deen is sticking with a bad business model. However, they're evidently able to cut corners to reduce/prevent overruns and still secure a lot of work.

so if deen know that they cannot make money form F/SN. why they still make it? plus where do you get this information?