Commentary

Can 40,000 Movie Theater Screens Compete With A 75-Inch Living-Room TV?

by Wayne Friedman , Staff Writer, January 18, 2022

Were U.S. movie theaters operating in a weakened admissions market even before the pandemic?

Movie theater companies didn’t see it coming. It's a bit like a horror movie, where shadowy figures are jumping out of dark alleys at the same time.

There are 40,000-plus U.S. screens -- up 13% since 2000. All the while, U.S./Canada cinema attendance per capita has sunk from a 5.0 rate in the early 2000s to under 3.5 versus, according to Cross Screen Media data.

Total admissions were at 1.24 billion in 2019. The Motion Picture Association says in 2020, only 3% of the U.S./Canada population (12 million) were frequent moviegoers -- those going at least once a month.

Guess what happened to the average ticket price? It climbed 70% over the period, to $9.16.

Now, factor in the growth of major streaming platforms, where a sizable portion of the movie business' film-going audience realizes they can get high-quality theatrical movies at home — at the same time those films are played in theaters.

In the recent past, movie theater locations have looked at big-screen live events -- music concerts, sporting events, and the like -- to bring in crowds in low-performing times of the year.

In the last two years, we had the pandemic, which accelerated the attendance drop, coupled with the rapid rise of streaming.

We suspect capital expenditures going into building these big movie screen locations will need to be remonetized to some degree. The bottom line: Should we be bracing for even higher movie-ticket pricing? It now averages near $12. Can it go to $15? Or $20?

This comes down to marketing -- something movie chain AMC Entertainment started doing in fourth-quarter 2021 -- in part to get people to come back after the pandemic period.

If the movie industry continues to believe the quality of its out-of-home exhibition of films -- larger-than-life screens, state-of-the-art audio, premier seating -- is worth more money, that is going to be a heavy lift.

For some customers, that might be a scary movie ending.

movies, streaming, tv

3 comments about "Can 40,000 Movie Theater Screens Compete With A 75-Inch Living-Room TV?".

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Ed Papazian from Media Dynamics Inc, January 18, 2022 at 10:56 a.m.
Interesting question, Wayne. In response I would pose this question, "If you are a swinging single and are trying to impress a lady friend, would you take her to dinner and then go home and watch a movie on your wide screen TV or take her to a theater and watch one there?"In other words, it may not be so much about the convenience or size of the screen---or even about the money saved---but it may be about the nature of the shared experience and what it symbolizes to each participant. As for older, and generally, infrequent movigoers, staying home and watching on a big screen may be just fine.
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Leo Kivijarv from PQ Media, January 18, 2022 at 2:16 p.m.

We saw movie admissions climb just before the holidays with the latest Spider-Man film generating over $1B worldwide. Admissions was down in 2021 due to the various COVID variants that led to spikes in cases. If you look at Taiwan, where COVID was relatively tame, there was a rise in admissions for domestically-made films (overall was still lower in 2021 than 2019, but that was due to fewer international blockbusters released).

Ben B from Retired, January 18, 2022 at 8:24 p.m.

I like going to the movies at the theaters that is the way movies are to be seen just my opinion.