 
Good
Numbers in 2001 –
Caution Going Forward
 Much
has been written about theatrical box office numbers in 2001. Indeed,
the numbers were good, and we should celebrate them. But I worry that
too much enthusiasm about the strength of those numbers could lead
to repetitive mistakes. I ask exhibitors to be cautious going forward.
We have not yet processed the final numbers for the year. Various
estimates, however, suggest that domestic theatrical box office substantially
exceeded $8 billion. EDI pegs the figure at $8.14 billion, Exhibitor
Relations at $8.35 billion, and The Hollywood Reporter at $8.38 billion.
It was, thus, the first $8 billion year in history.
Admissions, a more important number in my mind, also improved over
the previous year and may have topped the 42-year admissions record
set in 1998. The admissions estimates range from 1.44 billion to 1.49
billion. (Differences stem from different estimates of average ticket
price.) Anything in that range beats the year 2000 (1.42 billion),
and the higher estimate exceeds 1998 (1.48 billion).
Our friends overseas generally experienced very good years as well.
In Japan, box office surpassed $1.5 billion for the first time in
history, and admissions totaled 160 million — the highest number
since 1986. U.K. admissions rose 9 percent to 156 million, the highest
figure since 1972. U.K. box office rose 12.6 percent to $935 million.
French admissions topped 185 million, up 10 percent and the best since
1984. German ticket sales rose from 152.2 million in 2000 to 166 million
in 2001. Spain's admits also grew, to 137 million.
Why the good numbers? My favorite simple answer — good movies
and good movie houses. I don’t care what the critics say. I loved
the movies in 2001. And our patrons continue to enjoy the enhancements
in our new and upgraded theatres, here and around the world.
Part of the explanation, I believe, comes from an important trend
toward family-friendly films. Just look at the successes. The five
top films each grossed more than $200 million and none were rated
“R”. Indeed, of the top 20 films, all of which grossed over
$100 million, only three were rated “R”. After reviewing
the success of family-friendly films as the box office, Rick Lyman
of The New York Times recently wrote that “fears of a moral crisis
in the nation’s multiplexes may have been overstated from the
beginning.”
Box office and admissions numbers alone, however, do not tell the
true story for exhibitors. Screen count, too, plays an important role.
Indeed, part of the problem during the 1990s is that screen count
went up faster than admissions. During the previous two years (1999
and 2000), screen count went up while admissions went down. Less food
for more mouths. Now, both those trends have reversed. In 2001, screen
count went down (to nearly 35,000) while admissions went up. Both
trends need to continue for exhibition to continue its revival.
Indeed, my greatest concern with the positive numbers of 2001 is that
some exhibitors might believe another building frenzy is in order.
As chains exit bankruptcy periods with less leveraged balance sheets
and faster exits from underperforming leasehold obligations, there
are two risks. First, the restructured companies will begin to build
too many new properties. Second, other companies will occupy and reopen
the shuttered properties, either through outright purchase or management
deals.
I do not mean to imply that we should sit back and watch our wonderful
infrastructure decay. There will always be locations that need new
theatres. There will always be properties that should be refurbished.
But we simply MUST be selective and careful. We cannot return to the
frenzied days of building on top of each other. If we do, our recovery
will be short-lived.
Decreasing screen count would also help stymie a worrisome trend —
shorter film runs. Granted, part of the reason for shorter runs in
2001 was the familiarity of the film themes. We did experience the
year of the sequel, no doubt. But that concern will continue for the
foreseeable future as our partners in distribution look to produce
more known quantities and franchises. The only way we can help ourselves
collectively is to keep reducing the total number of screens. Fewer
mouths for more food.
Let us celebrate the box office successes of 2001. Let us learn from
the mistakes of the past. Let us move forward cautiously, and prosper.
|
