Exhibitors have drawn a line in the sand, steadfastly resisting the compression of release dates that they view as a threat to their livelihood. They get nervous when a studio attempts to release a movie on DVD less than 90 days after opening in theaters. Nonetheless, theater executives now are acknowledging they may need to adapt.
"We're going to protect our side of the business," said Amy Miles, chief executive of Regal Entertainment Group, the nation's largest theater circuit. But "we'd like to think that we'd work with the studios as business models evolved."
It's a delicate balancing act.
Theater operators want to be open to change without undercutting ticket sales, which have been remarkably strong. Above all, they hope the studios won't be oblivious to their concerns. "We want to know what's going to happen, and we want to have some input," said Tony Kerasotes, chief executive of Kerasotes Showplace Theatres and chairman of the National Assn. of Theatre Owners, a trade group.
For all their talk, however, studios say they're not ready to do away with windows entirely, fearing it could cannibalize their own business.
"People always say consumers want it all now, and Hollywood needs to change its business models," said Jim Gianopulos, co-chairman of Fox Filmed Entertainment. "But I've yet to see anyone show up with a simultaneous-release model that works.
"We need to experiment and allow consumers to take advantage of new technologies and ways to experience movies conveniently."
BusinessWeek has an article today explaining to its readers that movie theaters just might be a good investment.
"People have assumed for years that home theater and DVDs were killing off the business," says money manager Steve Birenberg, president of Northlake Capital Management and the media sector blogger for market research firm SNL Kagan. "Now we're seeing that's not true and it's much more stable and sustainable than investors thought."
Over the recent Easter weekend, the top 12 films brought in $130 million, up 61% from the same weekend last year. The previous weekend, which took in $148 million, was the biggest draw ever in April. And that comes after first-quarter receipts rose by 10% to 15% from the same period a year ago.
Now they're seeing that's not true. So are DailyFinance and Barron's (subscription req'd). Barron's published an investment note from Wall Street analysts at Piper Jaffray, which says, in part:
Year-to-date the domestic box office is up nearly 15% despite the battered consumer, lending credence to our thesis that solid content, escapism and low ticket prices relative to most other forms of out-of-home entertainment will combine to fuel solid box-office performance throughout 2009.
Double-digit increases in box office certainly do lend credence to that thesis. So do three straight years of gains at the box office. To be fair, though, it took the three previous down years for analysts to begin predicting the untimely demise of the movie theater industry. Both perspectives ignore the fact that the movie theater industry is on a three-decade path of modest, sustained growth.
Average Annual Admissions
The current ride of big box office and attendance increases is great fun and a rare bright spot in a tough economy. It's important to remember, though, that it will not always be this way. There will be years of slower growth and there will be years when attendance shrinks, but it's the long term trends and fundamental strengths of the business to keep an eye on. Trust me: the movie theater industry has been dying for 40 years and will continue to do so for as long as I can imagine.
Big media outlets are waking up to the phenomenal box office and admissions numbers being generated so far this year.
On Sunday, the New York Timesweighed in with the news that movie theaters are a bargain:
Helping feed the surge is the mix of movies, which have been more audience-friendly in recent months as the studios have tried to adjust after the lackluster sales of more somber and serious films.
As she stood in line at the 18-screen Bridge theater complex here on Thursday to buy weekend tickets for "Jonas Brothers: The 3D Concert Experience," Angel Hernandez was not thinking much about escaping reality. Instead, Ms. Hernandez, a Los Angeles parking lot attendant and mother of four young girls, was focused on one very specific reality: her wallet.
Even with the movie carrying a premium price of $15 because of its 3-D effects - children's tickets typically run $9 at the Bridge - Ms. Hernandez saw the experience as a bargain.
"Spending hundreds of dollars to take them to Disneyland is ridiculous right now," she said. "For $60 and some candy money I can still be a good mom and give them a little fun."
On Monday, it was NBC Nightly News, with Brian Williams waxing lyrical about the reasonably-priced comforts of settling in to a darkened movie theater, favorite snacks in hand.
There's a lot of emphasis on comedies and "feel good" films doing especially well. Is this your experience as well? What kinds of movies take you away during troubled times?
The Hollywood Reporterweighs in with 2008's projected box office tally from Nielsen EDI (the official keepers of the box office numbers for the MPAA and NATO) and it looks mighty sweet:
Meanwhile, buoyed by good weekday numbers and potentially strong holds over the holiday weekend, overall domestic boxoffice is poised to set a record. As of Sunday, 2008's year-to-date boxoffice stood at $9.45 billion, according to Nielsen EDI. By the close of business Sunday -- bringing down the curtain on the boxoffice year -- 2008 should surpass 2007's record haul of $9.62 billion by a couple of percentage points.
The final admissions tally won't be known until the end of January, when the year's average ticket price is calculated, but we expect it to be a little behind 2007.