Commentary

In-Theater Movies, In-Home Streaming Operate As Frenemies

Are streaming concerns for big in-theater movie entertainment overblown? That depends on your perspective.

This is the time of year theater chain owners worry about U.S. box-office revenue -- now trending at a 6% decline -- $9.9 billion -- versus results from a year ago.

Much depends on end-of-year revenue results for major franchise movies, such as Walt Disney’s “Frozen 2,” Sony Pictures’ “Jumanji: The Next Level” and Disney’s “Star Wars: The Rise of Skywalker.”

Eric Wold, entertainment analyst for B. Riley FBR Riely, believes at the current levels, fourth-quarter box office results could be “flat-ish.” Adding in those results, U.S. box-office revenue would sink 4% for 2019 overall versus the year before.

Still, he is emboldened about the future: “Most investor/media concerns around increasing streaming competition have been misplaced and recognize there are often strings of successes and failures in the box office."

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That has always been the case. But increasingly, other analysts have been concerned not just about the sustainability of major movie franchises -- "Star Wars," Avengers," "Spider-Man" -- but more about those mid-level theatrical movies that struggle to be profitable.

Some analysts believe the business will need help -- and that may come with more attempts at same-day openings: theatrical and streaming home services. Traditional movie studios, as well as upstart Netflix, continue to push these boundaries.

Think about how Netflix’s “The Irishman” is being marketed. The recent on-air TV advertising campaign -- featuring A-list talent -- Robert DeNiro, Al Pacino and director Martin Scorsese -- feels like a big theatrical movie release.

But, in fact, it is mostly a big streaming TV movie with a small in-theater distribution component. Netflix has been pushing its new original content this way for some time. This is how you now sell films to modern movie consumers.

The in-theater, big-screen, low-light experience won’t go away — thanks to eye-popping effects for fantasy/adventure blockbusters that appeal to younger consumers.

But the focus now will be on the in-between adult-focused, Oscar-intended films -- mid-level budgets movies that play in January/February. Those older adult-skewing films that run between summer and the November-December holiday period.

Right now, all those movies are at a virtual standstill when it comes to monetization -- a different kind of frozen.

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