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Posted by Mitchell Dvoskin (Member # 751) on 12-31-2018, 01:41 PM:
 
Is Netflix Killing The Movie Theatre? Not really according to the Washington Post.

Washington Post

quote: Washington Post

This Christmas, Hollywood’s major film releases are competing for Americans’ entertainment time with a slew of new shows on Netflix — and all those television series that slipped through the cracks during the year.

Yet many of those films — “Aquaman,” “Bumblebee,” “Mary Poppins Returns” — are projected to do big business in theaters, with “Aquaman” already winning the weekend with a strong $68 million opening through Sunday. Their success will cap a record-breaking year at the box office, upending the conventional wisdom that movie theaters’ relevance is fading.

Movie-ticket revenue in the United States has risen 8 percent in 2018. That puts the industry on track for the largest year-to-year increase of the domestic box office in nearly a decade — and suggests that, surprisingly, theaters can more than hold their own in the age of widespread at-home entertainment.

But the news also comes with significant dark clouds. Industry experts say that a future for the movie theater — a venue that Americans have for the past century pridefully counted as both an economic engine and cultural gathering spot — may be far from assured.

Those clouds include the fact that fewer movies are powering the box-office returns: Well over a third of revenue for 2018 comes from just 10 films, out of the more than 700 released during the year. And it’s primarily just two categories — superhero adventures and animated films — keeping the numbers afloat.

Some industry insiders even suspect some of the gains were driven by MoviePass, the beleaguered subscription service that essentially provided heavy subsidies to millions of filmgoers in the first half of 2018, when box office particularly overperformed.

“We’ve certainly had a strong year at the box office,” said Bruce Nash, a longtime expert on box-office returns who runs an industry site called the Numbers. “But there are a lot of signs this can’t continue. I think we’re going to regress to the mean very soon.”

The box office is an unusual economic indicator. It only partly reveals the financial health of film studios, as it fails to take into account production and marketing costs, both of which have been rising in recent years.

But it offers a window onto something perhaps more important: whether those studios understand the entertainment that Americans wish to consume. And, lately, whether Americans still value the country’s 41,000 movie theater screens, period.

In 2017, the numbers were stark. Box-office dollars went down, by 2 percent, a historically troubling sign given that ticket prices and the U.S. population grow every year. Admissions — the industry term for the number of tickets sold — dropped 6 percent to 1.24 billion, the lowest in 23 years.

This all coincided with an 11 percent spike in the number of Netflix subscribers in the United States, a gain that put the streaming service’s tally of U.S. consumers above the 50 million mark for the first time. And Netflix, of course, is opposed to playing movies in a large amount of theaters.

The die seemed cast: Theaters were losing ground to streaming services, and fast.

But in February, the Marvel movie “Black Panther” opened. And suddenly, the tide seemed to turn.

The politically minded superhero release would gross $700 million in the United States, the third most of all time.

It was followed two months later by another Marvel Studios production, “Avengers: Infinity War.” That film would gross $679 million — the fourth most of all time in the United States.

The domestic box office has just set a new record. On Sunday revenue for the year hit $11.38 billion, topping 2016’s total of $11.37 billion, which previously was the highest ever not adjusting for inflation. And the eight percent rise over 2017, if it holds, will be the largest since 2009, when revenue climbed ten percent over the previous year.

“People looked at the grosses at the beginning of 2018, and there was a lot of pessimism. They thought there was a deep structural change happening,” said John Fithian, head of the National Association of Theatre Owners, or NATO, the trade and lobbying group for the country’s movie theater business. “But look at where we are now at the end of 2018: We have a significant record-breaking year in terms of box-office grosses.”

There is no way to know exactly what led to the rebound this year. It could be a fluke, related more to the quality of and anticipation around a few Marvel films more than any broad adaptation. MoviePass’s aggressive marketing — it saw subscriber totals double to 3 million in the first six months of the year — also probably played a role, experts say. And that won’t continue: The service has since retrenched and is no longer as willing to pay the cost of a ticket for any subscriber who wants to see a film.

Whether the gains are in fact the result of one-off factors or a more fundamental shift will tell a lot about where the movie theater is headed in the streaming age.

Theater owners say it is decidedly the latter and that competition between streaming and theaters may not be as zero-sum as it seems.

Far from Netflix cannibalizing sales, its popularity is positively associated with theatrical moviegoing, according to Fithian. A study commissioned by his group released this week said that people who watch a lot of streaming also see a lot of movies, while limited streaming viewing is correlated with lower theater attendance. (It found, for instance, that 57 percent of respondents who watched at least 15 hours of streaming each week also went to the movie theater at least six times every year.)

The theory is that people who are fans of film are either inspired by the variety of choice at home to come out to theaters or at least are unaffected by it. Although past entertainment innovations, such as television in the 1950s, decidedly ate into box office, the theater industry says streaming is a neutral or even favorable development.

“Movie theater attendance and streaming consumption are positively related — those who attend movies in theatres more frequently also tend to consume streaming content more frequently,” the study said.

Not everyone is convinced. Some in the industry argue that Netflix and its ilk may still represent a substantial threat to theaters for all but the most epically scaled films, which require top-of-the-line sound and very large screens.

“I don’t think anyone who looks at the challenges movies face in a crowded landscape could argue Netflix is helping theatrical box office,” a film executive said, noting the historic lows for admissions last year. The reason, the executive said, speaking on the condition of anonymity so as not to upset theater owners, is the vast amount of choice streaming services offer, as well as the convenience. For most screen content, they noted, the experience at home isn’t that different from the one in a theater.

Even more troubling to some in traditional Hollywood is where the box-office growth is coming from.

The upper tier of the chart, they say, is carrying a growing amount of the load. Although overall box office is up 8 percent compared with last year, the revenue for the top five grossing movies is up double that, which means that all the other movies on average are well down.

Similarly, in 2009, the top 10 films constituted 30 percent of overall box office. In 2018, that number has risen to 36 percent. This indicates a kind of wealth gap, in which only a very small number of movies generate significant revenue.

What’s more, that top tier is made up of very few genres. In 2009, the top 10 movies were distributed among science fiction, vampire, fantasy, action-adventure, animated adventure, football drama and raunchy comedies. “The Blind Side” was on the list. So were “Avatar,” “Sherlock Holmes” and “Twilight.” And “The Hangover.” Disney had one movie.

But seven of the 10 highest-grossing movies in 2018 are either films with Marvel or animated characters, the industry’s seemingly only reliable pillars. An eighth is a Star Wars film. The remaining two are a Mission: Impossible and a Jurassic Park sequel. Half of the films come from Disney.

The fear, close watchers of the industry say, is what happens if — or when — the bottom falls out of the superhero boom. Without diversification, it could bring disaster.

“I’m not convinced that these franchises like Star Wars and Marvel can sustain for a long time. How many times can you save the world from a really bad person?” said Russell Roberts, a professor of economics at George Mason University. “And if it does, there’s no guarantee anything takes its place.

“I don’t think it’s a stretch to say that the movie theater business could one day contract or even disappear,” he added. Roberts offered the analogy of bookselling, which saw a great contraction with the arrival of online sales and, though it still exists, has realigned itself as a far more niche business.

Even the holiday release window, despite not seeing a Star Wars movie for the first time since 2014, does not exactly scream multiple genres with its three most promise-laden releases. “Mary Poppins Returns” is Disney family entertainment. “Bumblebee” is major intergalactic spectacle that is a superhero movie in all but name. “Aquaman” is — of course — a superhero movie. One other recently released film, “Spider-Man: Into the Spider-Verse” — which as an animated superhero movie combines both trends — is also flourishing.

Two studio executives, who asked not to be identified because they were not authorized to speak to the press, say these movies are made because the public wants them and that the studios would shift course if the market dried up. (Roberts noted that superhero films are “the symptom, not the cause — what people are willing to pay $20 in a theater for is much narrower than it used to be.”)

Besides, the executives point out, there’s room for smaller films to break through, noting the success of the transpacific romantic comedy “Crazy Rich Asians” and the high-concept science-fiction-horror “A Quiet Place” earlier this year.

But others say those are more exception than rule.

“You have occasional more-niche hits, but there doesn’t seem to be much room for them,” said Nash, the box-office expert. “The money,” he added, “all comes from the top.”

 
Posted by Justin Hamaker (Member # 2165) on 12-31-2018, 06:36 PM:
 
A couple of points here.

When it comes to Movie Pass, I think their influence has been over-stated. There was only a 3-4 month window where they were surging before the company started putting limits on people. While some of those users certainly did watch more movies, my observation is the most frequent MP users were just shifting how they were paying for tickets, not necessarily how many movies they were seeing. Although my theatre never had a ton of MP users, the use of the service has essentially dropped to zero.

The competition from Netflix specifically is probably over-stated because most of their content these days is not recent theatrical releases. And especially not the newest releases. When you add Netflix, Amazon, Hulu, and a few other services there is likely a compounding effect that is taking a bite, but the availability of recent releases is still pretty fragmented, and there is a significant lag between theatrical release and a "free" streaming option.

Outside of a few exceptions, I think the biggest change in the industry has been the diminishing attendance for adult themed movies. Clint Eastwood and Meryl Streep movies still put up a decent gross, but most other adult themed movies tend to have a hard time putting butts in the seats.
 
Posted by Harold Hallikainen (Member # 5405) on 12-31-2018, 06:52 PM:
 
We typically see an "adult" movie a week in a theater with a meetup group. Last night we saw "Searching For Ingmar Bergman" with 18 others in a Meetup group that has 2,800 members. The auditorium was probably 80% full. Tomorrow we're going to see Shoplifters with about 20 people. We get together for dinner and discussion after each movie. It's really nice!

On Movie Pass, at a recent movie Movie Pass would not cover the ticket for someone who wanted to attend. She bought a ticket for another movie that MP WOULD cover, then went to see the movie she wanted to see instead of the one she bought the ticket for.

Harold
 
Posted by Bobby Henderson (Member # 840) on 01-01-2019, 10:07 PM:
 
In the quoted article at the top of the thread, Russell Roberts said, "(superhero films) are the symptom, not the cause — what people are willing to pay $20 in a theater for is much narrower than it used to be.”

That's one way of saying it. Putting it more bluntly, if customers have to pay big dollars for a trip to the theater they only want to see a big event movie for that kind of expense.

The general consensus is smaller budget dramas and comedies don't require a big commercial movie theater screen and first run ticket prices to watch. The wait time between theatrical release and when it arrives on "HD Digital" download/streaming format is quite brief. The window is often 8-10 weeks now. If you can wait 3 months you can buy a Blu-ray from Amazon or Walmart for the price of one Lie-Max movie ticket. Some big December theatrical releases may have their Blu-ray versions on store shelves before the first day of Spring. The wait isn't much longer than that for the show to appear on Netflix, Amazon, etc to stream for no extra charge. Even a big hit movie, such as the last Avengers movie, can blow through its entire life cycle, from big theatrical screen down to Netflix, inside of a 6 month span.

The article also raised the point about how the home viewing experience has radically improved over the past 20 years. I personally felt a lot more pressure to see a movie on the big theatrical screen when the main home viewing outlet was a modest sized square-ish TV screen and a VHS VCR. Today I don't feel like I'm really missing anything by waiting for a movie to show up on Blu-ray or Netflix. And the wait time isn't several months or even over a year like it was 20 years ago with VHS and the early days of DVD.

It obviously a pretty risky thing for America's movie industry to become increasingly reliant on big budget amusement park ride type movies. Those movies are directed at a young demographic that really isn't growing in size, or buying power either. Young adults viewers can be a very fickle group too. They may not care as much about the differences between the conventions of watching a movie in a big theater versus watching a movie on a phone. They may not care as much about watching the movies legally versus buying a "Fire Stick" and watching crappy quality pirated content.

quote: Justin Hamaker
The competition from Netflix specifically is probably over-stated because most of their content these days is not recent theatrical releases. And especially not the newest releases.
Both Netflix and Amazon have quite a few 2018 movie releases available to watch, along with other older catalog titles they cycle in and out of the pool. They just don't cover all movie releases (some only play on Netflix, others are exclusive to Amazon, etc).

While Amazon offers a limited number of movies to watch for no extra charge via Prime Video, Amazon does offer rentals of just about any new movie release as soon as it is available to rent on any home viewing platform. That last part is pretty important when considering how the neighborhood video store has been eliminated throughout much of the nation. Brick and mortar video stores are now a niche that only survives in medium to large sized cities.

quote: Justin Hamaker
Outside of a few exceptions, I think the biggest change in the industry has been the diminishing attendance for adult themed movies. Clint Eastwood and Meryl Streep movies still put up a decent gross, but most other adult themed movies tend to have a hard time putting butts in the seats.
Here locally The Mule is doing pretty good business with the 50 and up crowd. But there are lots of Clint Eastwood fans around these parts.

There's multiple reasons why theaters may have a hard time pulling mature, middle-age and older adults into the theaters for grown-up releases. Not many movies are made for them. Then there's the issue of cost and the relative quality difference between watching a movie in a theater versus watching at home. A good number of mature adults own their own homes and may have impressive home viewing setups. Younger adults don't tend to have as much disposable income or as much room to store a bunch of material stuff. Plus there's a growing number of young people who prefer blowing their money on experiences rather than stuff.

If a local theater is having a hard time attracting older adults they might want to look at their newspaper advertising setup.

Older adults are the biggest demographic group that subscribe to newspapers. 20 years ago our local paper was much better and it had far better, more detailed movie listings. Today our two local first run theaters barely run any ads at all in the paper. But our local paper is a sad joke now: now owned by an out of town conglomerate who fill the sad, little addition mostly with ads, a few wire service news stories and next to nothing in terms of local news content. But a lot of older adults prefer getting their news and community info the old fashioned way rather than looking for it on the Internet. So if they don't know about a movie made for older adults they're liable just to wait and watch at home.

I think word of mouth is what is helping The Mule do decent business here.

quote:
We typically see an "adult" movie a week in a theater with a meetup group. Last night we saw "Searching For Ingmar Bergman" with 18 others in a Meetup group that has 2,800 members. The auditorium was probably 80% full. Tomorrow we're going to see Shoplifters with about 20 people. We get together for dinner and discussion after each movie. It's really nice!
Really huge cities like Denver offer at least some variety of movie-going opportunities. That's rarely available outside large metros.

Here where I live, unless I'm willing to drive up to Oklahoma City or down to Dallas, the variety of movies to see is limited to the major studio releases. And the theaters in those cities don't cover all the releases that show up in NYC or LA. It's rare to see any art-house/indie fare play in my town. Catalog movie shows are a dead thing now, specifically since a local theater called The Vaska closed recently. They ran The Rocky Horror Picture Show on the last night. For most "small" movies, my only option is to watch at home via rental. That allows Netflix and Amazon to dominate the movie watching market more. The really funny thing is 2 hour movies aren't as prominently listed as all those TV shows.
 
Posted by Justin Hamaker (Member # 2165) on 01-01-2019, 11:08 PM:
 
Bobby, I agree about Amazon having recent movies, but they are not usually free to watch. Typically they are a $5.99 rental, or you must purchase them. Netflixs's selection of new movies is very limited. As far as I can tell they are only add 3 2018 theatrical releases in January, all from Disney. All the other theatrical releases they are adding are at least a few years old.

Looking at Amazon the only 2018 movie available free with Prime is Life Iself, which was an Amazon production.

I stand by my original comment. Netflix and Amazon my be disrupting the theatre industry, but it's more because of their original content than as a platform for recent releases.

Netflix January 2019 additions
 
Posted by Leo Enticknap (Member # 534) on 01-02-2019, 07:49 AM:
 
1900s - is safety regulation killing the movie theater?

19-teens - are cartels (e.g. Edison) and industry oligopolization killing the movie theater?

1920s - is the church killing the movie theater (religious backlash against cinema, pastors telling their parishioners not to go)?

1930s - is radio killing the movie theater?

1940s - is the war killing the movie theater (in fact, it did the precise opposite)?

1950s - is suburbanization killing the movie theater?

1960s - is TV killing the movie theater?

1970s - are movie theaters killing the movie theater (old, down-at-heel, pre-multiplex survivors, that were uninviting places)?

1980s - is the VCR killing the movie theater?

1990s - is home theater killing the movie theater?

2000s - is Internet-based piracy killing the movie theater?

20-teens - is Internet-based (legal) streaming killing the movie theater?

Something is always killing the movie theater.
 
Posted by Mike Blakesley (Member # 26) on 01-02-2019, 03:38 PM:
 
I sometimes also wonder if part of the "home market" competition is not so much "the same movies we're offering" (except a few weeks later) as much as it is "all the other stuff available." Not so long ago, the typical house only had the three networks, unless they had cable, which generally offered:

HBO
Showtime
ESPN
15 or 20 other nationwide channels, with lots of ads

Whereas now, the typical person can say "I want to watch the new Avengers movie....oh, it's not available on Prime? No problem, I'll watch one of the other 37 million options I have."

I remember being really bummed if some episode of a favorite TV show was pre-empted by something else. Now I'm more likely to not give a shit, there's plenty of other crap to watch.

The idea of "there's nothing good on TV, let's go to the movies" is pretty much a distant memory these days. In the old days, you would go to the movies to pass some time...now you go to movies as "an event." So that's why "event" movies are making the most money. Time passers...well, they can wait for those.
 
Posted by Bobby Henderson (Member # 840) on 01-02-2019, 09:54 PM:
 
quote: Leo Enticknap
Something is always killing the movie theater.
I get it that the movie theater industry has survived a lot of challenges. But that timeline of decades suggests the movie theater business will keep trucking along indefinitely. Whether any of us likes it or not the movie theater business is currently trying to navigate through uncharted territory. It's obvious any business should never take its future for granted. Movie theaters are not an exception.

I worry that movie theater industry is being subjected to a death of a thousand cuts. No one single factor is going to kill the industry. But if multiple factors erode the business model the theaters will indeed disappear.

Brick and mortar video rental stores are all but gone. A Captain Marvel trailer has a scene with a Blockbuster Video store front to establish that movie takes place in the past. Book stores are another casualty to the likes of Amazon, along with top book store chains like Waldenbooks. All that "market disruption" is recent.

Second run & bargain theaters have disappeared in many markets. That wound in the death of a thousand cuts is being inflicted by the movie studios, all thanks to an ever shrinking theatrical release window. How can a bargain theater stay in business when the movies they're showing are often already available to rent at Amazon or buy on disc at Walmart? The Vaska here in my town closed for good due to that very problem. The Vaska tried showing classic movies, booking live music and doing other things to diversify. But it didn't generate enough business to pay the bills.

TV didn't kill off movie theaters. But TV sure inflicted a hell of a deep cut in their business. Admissions levels (actual number of tickets sold) has never recovered to the enormous numbers before Television. Way back then the cinema was the top form of recorded entertainment. The radio and a good book were the only alternatives.

I can remember how TV was when I was a little kid. It wasn't so great. There was only 3 or 4 channels, none of which stayed on the air 24 hours a day like they all do now. A bunch of the shows were in black and white. We had cable briefly when we were stationed in Yuma, AZ. I was blown away by what they could show on HBO (and pissed that my parents made me and my brother get to our rooms when something "really good" would show up on TV). In Iwakuni, Japan our TV station on the Marine Corps base didn't get color studio cameras for the local news until 1979. For three years that was the only English language channel my family could watch. Everything else we could get off the rabbit ears was in Japanese.

Today things are so different. Traditional cable TV offers a great deal of channels. Unlike 30 years ago, the local cable company doesn't have the customer by the balls. People can now "cut the cord" and ditch high priced cable/satellite TV subscriptions and stream many of the same channels via services like Hulu Live or Sling TV. Or they can save even more money by installing a good antenna for off-air channels and using basic Netflix, Amazon or Hulu subscriptions.

quote: Mike Blakesley
The idea of "there's nothing good on TV, let's go to the movies" is pretty much a distant memory these days. In the old days, you would go to the movies to pass some time...now you go to movies as "an event."
At the current price levels it has to be an event to justify the cost. I can take a walk in the park, go to the library or gym to pass some time.

It's not like movie theaters have a choice to slash ticket prices and costs at the concession stand. The theater management and staff has to be able to make a living.

One scary thing for theaters in urban markets is even if their margins are really good it might not be enough to stop some damned landlord from refusing to renew a lease. We've seen some high profile movie theaters, such as the Ziegfeld in New York City, get closed via those circumstances. The property owners see more dollar signs with a different opportunity.

We have an absurd thing like that going on in my town right now. Recently voters chose to legalize medical marijuana. So now we have a bunch of different people rushing to open dispensaries and do so in a very disruptive manner. One of our two local bowling alleys just shut down all of a sudden because the building owner wants to turn it into a grow house. Same thing happened to a bingo parlor building. Crazy.
 
Posted by Justin Hamaker (Member # 2165) on 01-02-2019, 10:41 PM:
 
quote: Bobby Henderson
One scary thing for theaters in urban markets is even if their margins are really good it might not be enough to stop some damned landlord from refusing to renew a lease.
This is one of those issues I'm curious to see how it develops. Brick and mortar retail is in decline, so it's not as easy to find new tenants. Especially in such a specialized space as a movie theatre. It's not like you can just redecorate and it's ready for a new tenant. It also seems like shops and restaurants around the theatre would have a vested interest in the theatre remaining open since it is one business that can draw people to an area.
 
Posted by Mike Blakesley (Member # 26) on 01-03-2019, 12:53 AM:
 
quote: Bobby Henderson
At the current price levels it has to be an event to justify the cost. I can take a walk in the park, go to the library or gym to pass some time.
You've been able to do those things all along though. There are always other diversions available.

The price of movies has pretty much kept up with inflation. When my theater opened in 1930, the adult ticket was 50 cents. According to an inflation calculator on the web, that's equivalent to $7.45 today. Our similar ticket today is $7.75, so a little higher, BUT you're getting a helluva lot more for your money than you did back in the day. Even in my own theater, which is not exactly a luxury house, the seats, sound and picture are miles better than they were even 10 years ago. And we have more snack and candy options than we did then.

The inflation equation is probably not as true for concession prices -- they're sky high due to the realities of the business and I don't see a solution to that happening. But I also don't think admissions would see a huge increase if popcorn prices suddenly dropped either.
 
Posted by Bobby Henderson (Member # 840) on 01-03-2019, 11:13 AM:
 
quote: Justin Hamaker
This is one of those issues I'm curious to see how it develops. Brick and mortar retail is in decline, so it's not as easy to find new tenants. Especially in such a specialized space as a movie theatre. It's not like you can just redecorate and it's ready for a new tenant.
There's not much anyone can do with vacant movie theaters unless someone is willing to do a very serious renovation to the building. Here locally what used to be the Video Triple theater is now a hardware supply store and the Showcase Twin was converted into a Blockbuster Video location. That building was demolished when Blockbuster went bust. The Cache 8 theater (which I loved to hate) sat empty for years until it was demolished. The property still sits vacant (along with a vacant former car dealership next door) because the street in front of it is one way traffic due to a freeway-like interchange along the main drag.

The former Carmike 8 theater here is also boarded up and empty. With all the rush to open medical marijuana dispensaries I guess they could convert the building into a massive grow house. The building has enough electrical power supply to get the job done.
[Razz]

quote: Mike Blakesley
You've been able to do those things all along though. There are always other diversions available.
My point is it doesn't cost me upwards of $40 for my girlfriend and I to go to the gym one time. Other diversions are actually cheap or free.

quote: Mike Blakesley
The price of movies has pretty much kept up with inflation. When my theater opened in 1930, the adult ticket was 50 cents. According to an inflation calculator on the web, that's equivalent to $7.45 today. Our similar ticket today is $7.75, so a little higher, BUT you're getting a helluva lot more for your money than you did back in the day. Even in my own theater, which is not exactly a luxury house, the seats, sound and picture are miles better than they were even 10 years ago. And we have more snack and candy options than we did then.
I live in a small city whose living costs are well below the national average, particularly for things like housing, utilities and fuel. Yet you can't see a first run movie for $7.75 here. It costs more than that. An adult matinee ticket on an ordinary screen is $8 or more and evening ticket prices are nearly $11. In larger cities standard ticket prices are even higher (and you might get dinged for serious parking cost if the theater is in a city center). That's without 3D, "IMAX" or any other premium priced features involved. If you want to see a new movie within the first couple or so weeks of its run there's a good chance you'll be stuck having to watch it on the premium big screen if the theater doesn't have the same movie playing in smaller houses. We had to do that to see Aquaman this past weekend. I don't know where the movie theater industry is coming up with these low-ball averages for ticket prices. 2nd run/bargain theaters are gone in many places. There shouldn't be enough of them around to help pull down the national price averages.

Concessions prices are ridiculous. If I was going to the movie by myself it would be a 50/50 shot at me bypassing the snack counter.

When you go to the movie as a couple the soft drinks and popcorn are almost always going to be involved. The dinner and a movie past time is definitely not a cheap date night activity any more. If we eat out and go to the show I'm dropping between $70 and $100. And I don't have to worry about baby sitter costs, unlike younger couples.
 
Posted by Tony Bandiera Jr (Member # 2365) on 01-03-2019, 12:01 PM:
 
Guys, it's not Netflix or concession prices that are killing the movie theatres..it is all of the following, in order from primary to secondary reasons:

There are so many factors involved, but the majority of them are caused by the first four items on the list (and yes, shitty movies is listed twice on purpose).
It is a snowball effect...but the first four are the REAL things that are gonna kill the theatre business model. Without bringing the butts in the seats, no theatre, chain or independent, is gonna generate the revenue to address the other problems.

But hey, the studios are gonna make billions (or high millions) with or without a traditional theatrical release....because they don't care about the theatres as a group.

That, IMHO, all started when the feds forced the decree that divested studios of their own theatre chains, because think about it for a minute...if you were a studio, and owned your own theatres, wouldn't you have the motivation to ensure the BEST possible presentation of your films? (That includes projection, sound, comfort, staff appearance and attitude, cleanliness and appearance of the theatre, etc.)

You wouldn't open up a bakery and be in a building with musty air, peeling paint, worn out floors, general filth, and sell mouldy baked goods ...you wouldn't stay in business for long.

So why do theatres suffer from the equivalent all of that, plus bad presentation? And why don't the studios ease up on the split and allow the theatres to make enough revenue to help keep things up to par?

Like I have said before on here many times, I would love to own and operate a theatre..but the way things are now it is not worth it. (If I had won the mega millions and had money to burn, I might, but with the understanding that it will not necessarily be a profitable venture.)
 
Posted by Justin Hamaker (Member # 2165) on 01-03-2019, 03:01 PM:
 
-Shitty movies
-Shitty movies
-Dreadful sequels
-Really bad sequels
Overall the quality of movies is definitely an issue. The endless stream of super hero movies is definitely having an impact on those who don't care for them. This is especially true in smaller towns where you have to play those to put butts in the seats

-Poor management and staff
This is a subjective factor which will vary by location. Our customers are generally complementary of our employees and staff. Customer complaints happen, but they are not frequent, and usually they are because the customer can't have their way

-Too many ads before movies
I believe most customers are ok with ads as long as they end by the published start time. Those who truly don't like them just make sure to show up a little later. Outside of really busy locations this decision doesn't usually impact seating availability.

Unimaginative theatre designs
No masking
I maintain the average movie goer does not choose whether to go or not go based on aesthetic features like masking and overall theatre design. These factors may play into why a customer chooses one location over another, but not whether they go at all.

Poor quality presentations (that digital was supposed to be the magic cure-all for)
I strongly disagree with this issue. Digital has resulted in a cleaner and more consistent presentation for the average moviegoer. Worried about the difference between 2k and 4k, or 2k and film, just haven't materialized in a major way. Aside from complaining about 3D, most people seem to be very satisfied with the digital presentation.

Studio greed
High ticket prices (see all of the above)
Premium screenings not withstanding, this is more of a perception issue. Ticket prices have more or less tracked with the minimum wage over many decades. People have a perception of it being more expensive because they are pulling more bills out of their wallet, but they are not really paying any more relative to wages.

Parking costs in many locations
Concession prices
Prices for things other than the movie probably do have an impact, but it is mainly downtown city locations where you have to pay for parking. I often go to movie theatres when I travel, and I rarely have to pay for parking. However, I will frequently choose a location away from a downtown area unless I am staying at a hotel within walking distance. Concession prices may seem high at the movie theatre, but it's how we pay the bills.

Short window to online/other viewing options
Finally, Netflix

Ultimately this list seems more like YOUR reason for not going to the movie theatre. Many of the items you listed are not primary considerations for most movie goers. Outside of the selection of movies to watch, I honestly believe it is "other entertainment options" which is most disruptive.
 
Posted by Bobby Henderson (Member # 840) on 01-03-2019, 04:27 PM:
 
It takes money to retain good quality managers and staff. And it takes a lot of money to properly design, build, equip and maintain a movie theater. If the margins aren't there to support those cost demands then something is going to take a hit. Independent operators and managers at small chains may have more control over what they can do in this regard. Managers for big chain theaters don't have as much of a say in the operations. Corporate bean counters almost always start at payroll, cutting staff numbers and holding down wages. Carmike was really obsessed with that. Then other features can be cut. If the theater chain's stock is publicly traded then there's always going to be pressure to cut costs deeper, water down the product so the investors get more money.

You can have the best quality theater in the world, but if the movies are crappy the customers are not going to show up. If the movies are good enough to see in a theater, but the release window is too short then more customers will just wait to watch the movie on TV at home. The cost difference between visiting a theater and watching at home is pretty big, especially when 2 or more people are involved in the purchase equation. We can talk about minimum wage levels, inflation and what not, but the fact remains many theaters are charging well above some $7 "average" ticket price.

quote: Justin Hamaker
Digital has resulted in a cleaner and more consistent presentation for the average moviegoer. Worried about the difference between 2k and 4k, or 2k and film, just haven't materialized in a major way. Aside from complaining about 3D, most people seem to be very satisfied with the digital presentation.
Here's the problem: 20-30 years ago film-based cinemas benefited from a giant quality gap over what one could see on TV at home. It was no contest. Watching a movie like Die Hard on 35mm in a mediocre movie theater was still better than watching the same movie playing from VHS tape on a square-ish TV. Today that giant quality gap between cinema and home viewing is all but gone.

There's hardly any penalty anymore for waiting for the home video version of a movie. 20-30 years ago it was common for movies to take a year or longer to go from the big screen to VHS (and later DVD). Remember rental pricing? People were paying $80 to own movies like Die Hard and Aliens on freaking VHS 30 years ago. Tape rentals cost more when factoring inflation versus renting something from Amazon now.

While d-cinema has made the overall average of theatrical presentation quality better, the system has been a quality reduction compared to film done right.

The notion that customers "seem to be very satisfied" with current practices is really a double-edged sword that can easily be used against theaters. If customers don't care about 2K versus 4K and don't mind watching the movie letter-boxed on an un-masked HDTV-shaped theater screen then why should they care about the difference between watching that movie at the cinema versus watching it letter-boxed on their big HDTV screen at home? The movie looks the same in the theater and at home! The wait is just a few weeks in order to save a bunch of money.

Hollywood studios can keep chugging along with this stuff, pumping out endless numbers of sequels, re-makes, super-hero movies and what not while continuing to shrink that release window. Obviously they think nothing they could do would ever be destructive or suicidal to their business since they're an institution that has been around over 100 years. Well, Sears, Roebuck and Company was founded 125 years ago, back when the cinema was in its earliest days. The company will probably die and be liquidated before 2019 is halfway finished. And that's all due to the choices made by a couple of terrible CEOs over the past 20 years. No business is invincible.
 
Posted by Justin Hamaker (Member # 2165) on 01-03-2019, 05:26 PM:
 
quote: Bobby Henderson
Here's the problem: 20-30 years ago film-based cinemas benefited from a giant quality gap over what one could see on TV at home.
While I completely agree with, and accept this point, I think the issue has far more to do with the higher quality available for home systems than a downgrade at theatres. While 2K digital may not be as good as "film done right", the difference is marginal, and not something the average consumer is going to notice. Especially when you consider the somewhat inconsistent quality of release prints.

Doing away with masking may diminish some of the "magic". However, I really think that for most consumers it comes down to watching the new movie on the big screen. The issues stemming from home equipment are far more likely to affect dramas than fx or action movies.

The other issue we're fighting is that many millennials don't seem to have a problem with consuming media on the 5" screen in their pocket. When this is the case I don't see how a 40' theatre screen or the projector resolution is a deciding factor.
 
Posted by Bobby Henderson (Member # 840) on 01-03-2019, 06:32 PM:
 
quote: Justin Hamaker
The other issue we're fighting is that many millennials don't seem to have a problem with consuming media on the 5" screen in their pocket. When this is the case I don't see how a 40' theatre screen or the projector resolution is a deciding factor.
Yeah, generally speaking, I think millennials and members of Generations Y and Z are more likely to be more flexible with how they watch movies. It may not matter as much to them if they're watching a movie on a large cinema screen or streaming it on a tablet or phone. It's one of the reasons why I think such a short release window is pretty hazardous (especially with the narrow difference in audio/video quality between cinema and home).

Baby Boomers and members of Generation X have more attachment to the conventions of seeing movies in theaters. But that loyalty only goes so far. At some point everyone, regardless of age, becomes price conscious. I know plenty of people my age or my parents' age who just don't go to theaters anymore. The value/price ratio of the cinema experience versus the living room experience is one of the issues. Another is just the pain in the ass factor. Deal with crowds at the theater or chill on the couch? Decisions Decisions.

Even though younger adults seem increasingly indifferent about commercial cinemas the movie industry is still directing much of its content toward those younger demographic groups. To be fair, the Star Wars saga and just about all of those super hero movies feature characters that were invented back when I was kid. And some of the people playing those characters are well into middle age. Still, I think the point remains that studios are appealing to a narrow slice of the general public. And there's really no guarantee those younger customers will keep showing up to theaters in great numbers. I think the movie studios need to work harder at reaching older customers.

Another problem is a lot of people in younger generation groups are struggling financially. The nation's student loan debt bubble is scary high. Housing costs are eating too much of their income. To me it seems like adults in 35-and-up age groups have more financial cushion to afford eating out and trips to the theater.
 
Posted by James Wyrembelski (Member # 9037) on 01-03-2019, 06:48 PM:
 
quote: Bobby Henderson
Another problem is a lot of people in younger generation groups are struggling financially. The nation's student loan debt bubble is scary high. Housing costs are eating too much of their income. To me it seems like adults in 35-and-up age groups have more financial cushion to afford eating out and trips to the theater.
This.

We are 30 & 33. We do not eat out, have cable, or do very many activities outside of the house. Most of our time is spent working. Between the two of us we have 3-4 jobs depending on the season, have limited expenditures, and barely see savings. We definitely save, but not as much as it should be. We still go out, but its very limited, and with so many cheaper options available in home we just go that route instead. Or, we use that money to maybe take a week or two vacation instead.

It's not all doom and gloom. But, after 2008-2009, we for sure learned to tighten it up and avoid any debt as much as possible.
 
Posted by Mike Blakesley (Member # 26) on 01-05-2019, 12:33 AM:
 
quote: Bobby Henderson
Here's the problem: 20-30 years ago film-based cinemas benefited from a giant quality gap over what one could see on TV at home. It was no contest. Watching a movie like Die Hard on 35mm in a mediocre movie theater was still better than watching the same movie playing from VHS tape on a square-ish TV. Today that giant quality gap between cinema and home viewing is all but gone.
The one thing we have, that no home system will ever have unless you live in a mansion, is the BIGNESS of the theater experience. My screen here is a relatively small (for a theater) 30 feet wide, but that's still about 8 times wider than the biggest TV screens at home. If you sit halfway down our auditorium the picture is field-of-vision big.

Our sound system has six amplifiers and about 40 drivers in 17 speakers and is set to a comfortable listening level. There are thousands of theaters with bigger systems than what we have. A lot of home viewers, though, are watching a 50" screen with a "theater in a box" sound system with two 3" surrounds and a 6" subwoofer, which may or may not be turned down low so as not to disturb the baby sleeping.

The exhibition industry offers two main things that you can NEVER duplicate at home:

- The size of it all

- Getting out of the damn house

These are the two things the industry should be touting. Instead of a bunch of alphabet soup gobbledy-gook brand-names of "systems" that nobody really cares about.
 
Posted by Bobby Henderson (Member # 840) on 01-05-2019, 02:14 PM:
 
quote: Mike Blakesley
The one thing we have, that no home system will ever have unless you live in a mansion, is the BIGNESS of the theater experience. My screen here is a relatively small (for a theater) 30 feet wide, but that's still about 8 times wider than the biggest TV screens at home. If you sit halfway down our auditorium the picture is field-of-vision big.
Again, this is another factor where 30 years ago the difference gap between the cinema and home was far greater. During the first 15 years of the home video boom the best consumers could get was SD quality video with stereo sound. Even back then someone could blow over $5000 on a projection screen TV, but the resuting picture was a bunch of fuzzy, washed-out looking crap. From the mid 1990's on to today there has been a great deal of incremental improvements to make the home theater experience pretty damn impressive.

Yeah, a movie theater screen is certainly larger than any home TV screen in terms of total scale. But the ratio of viewing distance and size of the screen has its own effect. I have a 65" TV in my living room and my viewing distance is about 7 feet. That fills my field of vision every bit as good as any standard movie theater screen. New TV screens are pretty impressive and becoming more affordable.

quote: Mike Blakesley
The exhibition industry offers two main things that you can NEVER duplicate at home:

- The size of it all

- Getting out of the damn house
If the theater is really doing to sell size and scale as a bullet point for attracting people to the theater they have to build rooms and screens to back up that sales point. When I entered a movie theater like the GCC Northpark #1 THX house in Dallas I couldn't help but react with "wow." That was a BIG and damn impressive theater. That theater and many others like it are gone. Theater chains don't build any new theaters with 1000+ seat auditoriums.

I've been in a lot of movie theater auditoriums that were not impressive at all. Low seating counts, modest screens and weak-ass sound with the volume turned way down because some fart complained about it once and management kept the fader down to nothing to stop all the complaints. This is a common situation in many multiplex operations. We have only one screen in my town that I consider impressive in terms of size, and you have to pay $3-$6 on top of the normal ticket price to see a movie in that room. It's also the only auditorium where they have the volume turned up enough for the sound to be dynamic at all. I miss the 1990's when movie theaters had a lot more "oomph" in their sound systems, back when things like THX were still a thing.

Getting back to what Justin said on the previous page, does the average customer even care about the difference between the size of a cinema screen versus a big TV screen at home? We have people satisfied with watching movies on a freaking phone, or watching a bootleg video of a theater screen on their computer screen.

The "getting out of the damn house" angle is another complication. There is a significant group of the public who can't afford to get out of the damn house because they're broke from all sorts of other things eating all their income. Then there's others who might have to money to get out on the town, but they don't want to do any of that. They want to cocoon themselves up in their home. Parts of our society are becoming increasingly introverted. We have absurd trends like home grocery delivery. 2018 was a serious down year for the restaurant industry, so chains like Starbucks and McDonalds are looking at home delivery as an option to win back customers.

I know it sounds like I'm arguing just to argue. I just think we're in some pretty strange times now. I don't want commercial movie theaters to go away (in part because I think it would kill off much of the movie business as we know it). I just don't agree with any notions that things are hunky-dory and movie theaters will always be around. Nothing can be taken for granted.
 
Posted by Mike Blakesley (Member # 26) on 01-05-2019, 10:57 PM:
 
quote: Bobby Henderson
Yeah, a movie theater screen is certainly larger than any home TV screen in terms of total scale. But the ratio of viewing distance and size of the screen has its own effect. I have a 65" TV in my living room and my viewing distance is about 7 feet. That fills my field of vision every bit as good as any standard movie theater screen.
That's still not the same as sitting in a really big room with a really big screen. I think exhibition companies are trying to impress more with their newer builds.

If you're seeing movies in dinky rooms maybe you're just waiting to long to see movies. Theater companies can't just stop using auditoriums because they're "not big enough." They have to wait until their useful life is over. The industry operates on a slim enough profit margin as it is.
 
Posted by Bobby Henderson (Member # 840) on 01-06-2019, 12:05 AM:
 
I rarely wait until the tail end of a movie's theatrical run to watch the movie. It's just that there's a lot of multiplex locations aren't exactly "palacial."

Yeah, some companies are trying to impress with new builds. But far too often the houses with the big screens and decent sound have some premium priced acronym label applied to them. The remainder of auditoriums are pretty ho-hum.

One of the problems with dinky auditoriums dates back to the 1990's when the number of screens in a location was a selling point. One example is a weekend trip to Dallas in the late 1990's; we watched Amistad at the AMC Grapevine Mills 30. The room where we watched the movie couldn't have had more than maybe 60 or 70 seats in it, tops. This is a theater in a giant-size mall in the DFW metro, not a multiplex in some 10,000 person town. It's like AMC built a 30-plex into the footprint of a standard 12-plex site. I refuse to see movies at the local 12-plex in the mall because it suffers from the same thing.

Maybe what needs to happen is the big chains need to build sites with fewer screens and make those screens better.

At the same time, it's hard not to be impressed with the latest UHDTV sets even if there's not a lot of native 4K content to show on them. My father has a 65" Sony OLED UHDTV screen. The image quality on that is pretty outstanding. I do not mind watching a movie for the first time on a screen like that at all.
 
Posted by Martin Brooks (Member # 1269) on 01-18-2019, 01:48 PM:
 
The problem is that theater owners are moving towards far smaller auditoriums and as Bobby has said, this results in less of a differentiation between the home experience and the theater experience.

I understand why theater owners feel there's no problem ripping out the seats and putting in lounge seating: AMC, the largest theater chain, has average sales of only 92 tickers PER DAY, per screen.

While some people abhor crowds, seeing a film, especially a popcorn film or a comedy with just a few other people in the theater completely changes the experience. This was brought home to me before 2005, when I was consulting for a company that evaluated presentation quality. If a film was playing in a multiplex on multiple screens, I had to see the film on every screen. And I discovered that it was a different experience in each auditorium and the audience reacted differently to the film, depending upon the atmosphere of the auditorium and the quality of the presentation (and the audience itself - even jokes played differently).

There was something vastly different seeing Star Wars or Close Encounters or Lawrence of Arabia with 1000+ other people and seeing a film like that today with maybe 100. When I was a kid, the small neighborhood theater that didn't get the big films had 600 seats.

Several new theaters have opened in NYC recently. While most are art houses that aren't playing the big blockbusters, I think these theaters are doing just the opposite of what they should be doing: they're making the experience "small". The iPic Fulton Street, which opened in late 2016, has 8 screens with a total of 508 seats ranging from 43 to 138 per screen. The Metrograph has two screens of 175 and 50. The East 62nd Street 6 opened a few weeks ago with 6 screens totaling just 312 seats with the smallest theater having just 43 seats. Landmark opened an 8-screen theatre on 57th St to replace the closed Sunshine that has 558 seats over 8 screens, with the smallest having just 19 seats. Is this how people want to see movies? The other problem in such auditoriums is that there's only a few ideal seats.

And the older larger theaters have reduced seat counts when installing lounge seating. The Regal E-Walk once had 3276 seats. Now it has 1344, although I suppose the screen sizes haven't changed.

Obviously I can't speak for everyone, but it's killing the theater experience for me. And the problem with it from an economic standpoint is that every time a theater sells out a show because there aren't enough seats, they're leaving money on the table. I don't understand how his makes business sense.

Personally, I think the chains, in the cases where they have multiple theater buildings in the same city, should reduce the number of screens in each facility, enlarge the theaters to have giant screens (and sound) and be willing to play different films at different chain locations. Why do they feel that every theater has to play exactly the same films? In NYC, a lot of IMAX or Dolby Vision films never play in those formats because every theater with those types of auditoriums are playing exactly the same film. People are willing to travel a bit to get to a movie that they want to see.
 
Posted by Mark Ogden (Member # 43) on 01-18-2019, 03:32 PM:
 
We can discuss presentation and screen and auditorium size vs. home theater until we are blue in the face BUT: right now, everybody who I talk to about visual media is talking almost exclusively about Birdbox, Roma, Black Mirror: Bandersnatch, The Ballad of Buster Scruggs, Tidying Up, Stranger Things, Ozark, The Haunting of Hill House, The Last Laugh and on and on . . . all Netflix content, except all the gals are talking about The Marvelous Mrs. Maisel on Amazon.

On any given evening I can find therein an entire multiplex worth of entertainment, most of it pretty damn watchable. I don't think Netflix will kill theaters, but if they put a big damn dent in them it will be because have they have things people actually want to see and talk to each other about, and the fact that they saw it on their 46" Samsung instead of in an overpriced faux-leather recliner looking at a movie screen is meaningless.
 
Posted by Justin Hamaker (Member # 2165) on 01-18-2019, 04:38 PM:
 
Another point on this issue is Netflix is hurting the theatre business by harming the perception of a movie theatre being the place to first see the newest movies. They could have done a great service to the industry by releasing Birdbox to theatres, while also potentially helping their debt situation.

What will be interesting to watch is what happens as Netflix begins to lose content as studios migrate to their own platforms, especially Disney. With Netflix raising rates again it changes the calculation about whether they are worth the money given a lack of premium content and a price approaching 2 movie tickets.

It is also going to be interesting to see how the mounting debt will be an issue for a company with no additional revenue streams. In fact, I'm kind of surprised investors haven't made more of a push to have more theatrical releases.
 
Posted by Martin Brooks (Member # 1269) on 02-14-2019, 09:26 PM:
 
quote: Mark Ogden
BUT: right now, everybody who I talk to about visual media is talking almost exclusively about Birdbox, Roma, Black Mirror: Bandersnatch, The Ballad of Buster Scruggs, Tidying Up, Stranger Things, Ozark, The Haunting of Hill House, The Last Laugh and on and on . . . all Netflix content, except all the gals are talking about The Marvelous Mrs. Maisel on Amazon.
Roma is perhaps an exception, but I don't perceive those other programs as movies - I perceive them as TV shows. The other issue is that streaming shows that people are interested in aren't all on one service. It would take a subscription to 4-5 services to get everything that's "hot" and most people aren't willing to do that. And that's only going to get worse as Disney, AT&T and Apple launch their own streaming services in addition to the ones that already exist.

I can't see them all surviving, but I never believed that hundreds of cable channels could all survive either.

I posted an earlier response in this thread, but I don't think Netflix itself is killing movie theaters, but the studios are and they're doing so by the ridiculously short windows that the theaters have. The theater chains were nuts to let that happen and they could have easily stopped it: they could have simply refused to play any film from a studio that shortened the window to X months. The theatrical window used to be a year and even after that, it didn't go to home video - it went to HBO and then to network TV and then to home video and other outlets.

As far as I'm concerned, the studios are on a path to a slow suicide, but they never look at the long term and they want to release in every medium at once because it reduces costs and improves cash flow. But IMO, it destroys their business over time.
 
Posted by Bobby Henderson (Member # 840) on 02-14-2019, 10:05 PM:
 
I think another important point to consider in movie distributor behavior is the actual "shelf life" of the executives calling the shots. How many of these guys are spending most or all of their adult, professional life working for a particular movie distributor? Just like so many other big corporations a bunch of these studio heads come and go every few years. I don't think any of them are helming a major studio for 20 or more years.

What do you get with executives who have short term stints running the company? You get short term schemes designed to make as much money as possible up front. There's no regard for what consequence may be involved 5, 10 or 20 years later. That honcho is going to make as much money for himself up front. And he's not likely to give a damn about the kind of "legacy" he might leave behind for that studio and its brand.

I think short term, personal gain is the driving force behind these studio heads being hell-bent on shrinking theatrical release windows and trying all sorts of other stunts to speed up the cash-flow situation.
 




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