Movies are an “outdated” distribution model that generated $ 42.5 billion in worldwide sales last year.
We learned this week that AMC may run out of money by late 2020 or early 2021, either from an increase in global box offices (unlikely as almost every major release for 2020 to 2021 will be delayed or sent to PVOD streaming) or by a cash infusion that keeps it from bankruptcy. Cinemas, many of the big chains, have already survived bankruptcy when the chains overcrowded the market with newer and better movie theaters to compete with the cable in the mid-1990s. The competition is tougher this time around as streaming and VoD threatens to make movies a secondary option for high-quality movie entertainment.
But if AMC goes bankrupt and / or the cinema chains don’t survive, it’s not because of anything other than the pandemic that has kept audiences out for most of this year.
If the theaters don’t survive, and I suppose they will in some ways survive, it’s not because of Chris Nolans principle wasn’t popular enough or Disney’s Mulan went to PVOD. It won’t be that Hollywood hasn’t evolved over time, or that theaters haven’t rivaled the entertainment options at home. Yes, we may see a “cinemas as video game arcades” scenario (just like arcades collapsed when home consoles approached or surpassed most cabinet-style video games) where cinemas are reserved for only the biggest big blockbuster experiences you have at home cannot repeat. But if theaters don’t survive the coronavirus, it’s because of the pandemic.
Everything else is a distraction. People don’t avoid theater because they don’t want to, but because they can’t, because they don’t feel safe, or because there is a lack of tent poles in these theaters. The theaters have no problems with Netflix
or “Hollywood never makes original adult films!” Theaters are in trouble because a pandemic closed the globe earlier this year and theaters were prevented from doing the only thing they do by showing big new films in theaters show that they could make money with.
Since the pandemic was arguably not properly treated in America (arguably due to a disinterested federal executive branch), such theater recovery was not possible elsewhere (as in China) in America. This led Hollywood to hold its big event films for a later date. Everything else about the push-pull between cinema and streaming, films versus television, etc. is irrelevant. The theaters spent much of the year unable to generate the revenue. And in normal times, cinemas are still very popular.
The number of North American tickets sold in 2019 was around 1.235 billion (so it is said) The payment), falling again and again from the high of 1.575 billion in 2002 (in the months following the 9/11 attacks and during a wave of new mega-films like) Spider-Man, Harry Potter and the Chamber of Secrets, the two towers and Attack of the clones). The 1.318 billion domestic tickets sold in 2018, however, are not far from the early 1990s, before the multiplex became mainstream and gimmicks like stadium seating and digital sound became a matter of course.
Between 1995 and 2019, the difference between the worst year (2017 with 1.225 billion) and the best year (2002 with 1.575 billion sold) is around 22%. The decrease between 2009 (1.418 billion) and 2019 (1.235 billion) is 14%. 2009 (if unlikely to crash like The blind side, new moon and the Hangover broke out alongside User picture and Transformers: Dunkel of the Worlds) was the first year North America revenues exceeded $ 10 billion. They ranged from $ 10.173 billion in 2011 to $ 11.946 billion in 2018, a difference of 15%.
In terms of total domestic income, adjusted for inflation, 2004 was the last year to exceed $ 13 billion. The total of $ 13.6 billion was partially “never happen again” by two blockbusters (The Passion of Christ with $ 373 million and Fahrenheit 9/11 $ 119 million) that spawned people who otherwise didn’t go to the theater regularly. Total domestic inflation-adjusted income has stabilized over the past 15 years between $ 11.165 billion in 2017 (in part because the Biggies of 2016 were unusually horrific) and $ 12.9 billion in 2009. This corresponds to a breakdown of 14%.
That’s no reason for a decade of overseas expansion (not just China). Rising ticket prices and an increasing number of consumers who watch their films in “premium” formats, be it IMAX
, 3-D, D-Box or various high-end theaters for “Dinner and a Movie” have helped to make up for the difference. Since the theaters make most of their money with concessions, they certainly don’t mind if people have a full menu or a bottle of wine with the film. If I were running a theater, I would consider composing tickets (especially for kids / family movies outside of rush hour) in exchange for comparable concession purchases.
Given the tide of competition for entertainment money and the increasing availability of high quality home presentations (1080p, surround sound, etc.) for both movies released in theaters around 90 days after opening day, as well as increasingly sophisticated television and streaming content, I would argue that “A bit stable” is still pretty decent. Yes, local moviegoers have been spending an increasing proportion of their movie money on a rapidly decreasing number of mega-dollar tent poles, which is more of a problem for the studios as opposed to the theaters.
It stinks that out of $ 3.8 billion out of $ 11.123 billion in 2017, the top ten films were represented. But movie theaters make most of their money from concessions and a big popcorn they bought War of stars: The last Jedi costs the same as for bought All the money in the world. Say what you will say about theaters that don’t recognize the future or Hollywood is too franchise-dependent, but theaters made $ 42.5 billion in revenue worldwide last year. You might have a great home theater setup and you might prefer to wait for VOD or streaming, but $ 42.5 billion worth of people chose to watch movies in theaters last year.
If studios could make comparative profits that they could benefit from Toy Story 4 or a Splits from VOD they would have left the theater 15 years ago. Trolls: world tour was dragged out of (most) movie theaters for PVOD in the middle of a nationwide lockdown, with the sequel to DreamWorks offering “new” family-friendly entertainment for quarantined families. It still “only” grossed around $ 95 million in 19 days, or whatever was the first Trolls earned ($ 93 million) in the first 17 days of domestic release. If Disney were happy with how many people paid $ 30 on the lease Mulanwould not offer them soul free on Disney +
If this summer’s PVOD dump produced results comparable to its worldwide theatrical release, we wouldn’t wait until next year not to just watch mega-films like that Top Gun: Outsider and F9 but like (comparatively) smaller flicks Candy man and In the heights. I would argue that part of this is due to the fact that the people who are most likely to see something at home are also most likely to be willing to wait until it is much cheaper than “renting $ 20 or buy 25 USD ”.
The studios love to talk about the sanctity of the theater experience. Aside from appeasing filmmakers who still want to see their work in theaters, it is mainly because they know that big films cannot make massive profits as PVOD rentals or exclusive streaming. If the theaters don’t survive, it is because they have been hit by a pandemic that prevented theaters from doing the unique things they do to make money. Cinemas are hurting right now because there’s a pandemic that has resulted in everyone, right or not, being able / unwilling to visit their local multiplex. This resulted in Hollywood either delaying their big upcoming releases or sending some of them to PVOD or Streaming on a case-by-case basis.
That the entire theater industry is teetering on a cliff because America failed to bring the pandemic under control compared to other major overseas markets shows the decades-long lie about the supposed central importance of overseas box offices. China is back to normal, and local blockbusters are making what they would have made without pandemic-related variables. If Hollywood didn’t rely on the domestic box office as the market responsible for 30-50% of global gross, Wonder Woman 1984, no time to die and Black widow could open theatrically overseas and on VOD / streaming in America.
Everything else, streaming, VoD, ticket prices, stagnant wages, the quality / value of the theater experience is a distraction from the fact that a plague forced cinemas to close for much of 2020.
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