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They make money off the people who will buy it by mistake, but they mostly make money off how many a distributor will buy. Walmart, for example, will buy a boatload of these dvds. The movie producers, due in large part to previous relationships with Walmart or can pull figures of similar knock-off films, can "pre-sell" the movie - get money from financiers on its projected sales - and voila, you got yourself a knock-off of whatever big summer movie is coming out. Walmart then sells the dvds for $2 - you've seen those big bins in the middle of the electronics department - and due to its low cost, high volume, high capital, and low competition - they'll pull a steady profit. The producers used to also sell the movies to television networks. That happens a lot less often than it used to, but every now and then you can find one of these knock-offs on the Sci-fi channel. Now mind you, percentage-wise, they're not making much of a profit. But it's a steady market. Think of it in baseball terms. Josh Hamilton will hit 50 home runs, but strike out 200 times. Ichiro Suzuki will hit 15 home runs, never strike out, and get over 200 hits. Who's guaranteed to be consistently better?
"Your current frequencies of understanding outweigh that which has been given for you to understand." Saul Williams
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