Future of the movie industry (THE DEATH OF MOVIEPASS)

[YmoBeThere]

I think the bigger story will be potentially the worst summer box office in nearly a dozen years.

[Wander]

I think the bigger story will be potentially the worst summer box office in nearly a dozen years.

Interesting. I was going to ask JE if it was an unusually good summer for mainstream movies. Spider-man, Dunkirk, Wonder Woman, Planet of the Apes, Big Sick, and Baby Driver, all popular movies that are over 90% on rotten tomatoes. Probably will end up with 3 of the top 5 over 90%. Is that unusual? I'm guessing that it is but I really have no idea.

[JasonEvans]

Interesting. I was going to ask JE if it was an unusually good summer for mainstream movies. Spider-man, Dunkirk, Wonder Woman, Planet of the Apes, Big Sick, and Baby Driver, all popular movies that are over 90% on rotten tomatoes. Probably will end up with 3 of the top 5 over 90%. Is that unusual? I'm guessing that it is but I really have no idea.

Well, it is not like Big Sick ($36 mil) and Baby Driver ($100 mil) were huge boxoffice draws who helped shape the summer. They each did very nice business considering their budgets and the marketing behind them, but the overall summer boxoffice is not doing well. We are on course for May-Aug to do about $4 billion, which would be down more than 10% from 2016. And it is the big budget, big boxoffice films that determine that top line much moreso than a couple smaller indy hits that combine to gross less than $150 mil at the boxoffice.

In terms of quality, this has been a pretty good year. As you mention, several of the top marketed titles of the season were huge critical successes that audiences also loved. 4 of the major, big budget films fall into this category (5 if you count Guardians 2 scoring a pretty strong 82% on RT and 89% Flixter score). Last summer only saw Finding Dory and Cap:Civil War as big budget films that had high critical scores. 2015 was really strong with Inside Out, Mad Max Fury Road, and Rogue Nation all being big critical hits (and films like Jurassic World, Avengers: Ultron, and Ant Man also doing quite well in reviews). But, the bottom line is that there seems to be only a passing correlation between critical applause and the overall summer boxoffice.

So, what is happening to cause this year to really suffer? There are a lot of theories. I think the one that rings the most true to me is that the film industry is catching the same cold that has been impacting the broadcast TV world for a while -- there are just a lot, lot, lot more options for ways to capture our entertainment attention. Streaming (Netflix, Amazon, HBONow, whatever) has really taken off in the past year. It was huge but keeps getting bigger and bigger. Amazon, Netflix, and others are spending big money to fill their channels with high quality programming -- and it is a heck of a lot cheaper for a family to watch Netflix every night of the week than it is to even go see one movie in theaters. The pay channels (HBO, Showtime, Starz) have also really stepped up their game with content as well. I fully expect Sunday movie ticket sales have been impacted by Game of Thrones over the past month. American Gods attracted a lot of attention earlier this summer too. There are numerous other examples.

I'm not saying Hollywood is dying, just that the glut of competition makes it harder for the big studios to capture the nation's attention. I suspect we will see a stronger winter from Hollywood too as Justice League, Thor:Ragnarok, and especially Star Wars 8 will probably big major hits that everyone feels the need to see to be in on the cultural conversation.

-Jason "some may argue that Netflix will eventually kill the studios... I doubt that but something will someday need to be done with the movie theater experience/pricing structure or the studios and the theater industry will be in huge trouble" Evans

[davekay1971]

-Jason "some may argue that Netflix will eventually kill the studios... I doubt that but something will someday need to be done with the movie theater experience/pricing structure or the studios and the theater industry will be in huge trouble" Evans

Its going to be interesting to see how the movie industry innovates over the next decade or two. Theaters have always run well on the simple fact that watching video entertainment on a large screen with a professional sound system is simply a different experience than watching the same video on your TV at home. While theaters have tweaked this experience over time, with ever-improving sound systems, changes in seating (our local theater now has big overstuffed recliners with individual cupholders and plenty of legs room), and, of course, IMAX screens or 3D. But the reality is those studios are now feeling the pressure, as evidenced by Tom Holland telling us before Spider-Man comes on screen a big hearty thank you for coming out to the theater. Cost of making movies keeps going up. Ticket sales keep going down. Ticket prices are already at a point where rising the price further will likely start lowering the gross.

So we may see tighter budgets. Already Hollywood is seeing that franchises sell better than name-brand actors (although actors still provide some needed box office muscle, like RDJ specifically in the Iron Man role). Hollywood may do with actors like the NFL has done with running backs: pay less planning to get the same job done by building around a cheaper, slightly less known or talented performer. Market forces may make CGI costs drop - providing reasonably high quality effects for relatively less money. Plus we may see further theater experience innovation - allowing audiences to still have the enjoyment of group entertainment while using tech to give an even more immersive experience.

At the end of the day, though, I think technology and the increasing way we live our lives online will dictate that watching recorded entertainment in a public theater environment may become a novelty anachronism, where those old made-for-big-screen-movies are enjoyed as a different, fun kind of dinner experience or at amusement parks, while the new releases are streamed directly to our wireless fully immersive virtual reality sets at home.

[Olympic Fan]

-Jason "some may argue that Netflix will eventually kill the studios... I doubt that but something will someday need to be done with the movie theater experience/pricing structure or the studios and the theater industry will be in huge trouble" Evans

Or will the studios eventually kill Netflix?

Disney is pulling its films from Netflix

https://www.popsugar.com/entertainme...tflix-41441900

-- that's a BIG hit for the service ... cutting into the content available to families with kids. If Disney also pulls the Star Wars and Marvel films (being debated right now), it's going to hurt bad. And if other studios follow suit, Netflix could go the way of Blockbuster.

[Mtn.Devil.91.92.01.10.15]

Or will the studios eventually kill Netflix?

Disney is pulling its films from Netflix

https://www.popsugar.com/entertainme...tflix-41441900

-- that's a BIG hit for the service ... cutting into the content available to families with kids. If Disney also pulls the Star Wars and Marvel films (being debated right now), it's going to hurt bad. And if other studios follow suit, Netflix could go the way of Blockbuster.

The only Star Wars movie on Netflix is Rogue One. There may be a few Marvel movies, but the only I have seen on there recently is Captain America: Civil War. I suspect the Netflix/Marvel original content is FAR more valuable, and isn't going anywhere.

[JasonEvans]

Or will the studios eventually kill Netflix?

Disney is pulling its films from Netflix

https://www.popsugar.com/entertainme...tflix-41441900

-- that's a BIG hit for the service ... cutting into the content available to families with kids. If Disney also pulls the Star Wars and Marvel films (being debated right now), it's going to hurt bad. And if other studios follow suit, Netflix could go the way of Blockbuster.

Except the vast majority of content streamed on Netflix is TV shows, not movies. I suspect that there won't be all that much of a subscriber loss when Disney pulls content from Netflix. While there are some parents of small kids who primarily use Netflix for the access to Disney/Pixar movies, most Netflix subscribers are there so they can stream many seasons of TV shows with the movies being just an added bonus.

By the way, I found this cool infographic... which came out in 2016, before Stranger Things.



-Jason "now, if Disney/ABC pulls all the ABC and Disney produced TV shows from Netflix, that could move the needle... especially if other studios followed suit" Evans

[gus]

Except the vast majority of content streamed on Netflix is TV shows, not movies. I suspect that there won't be all that much of a subscriber loss when Disney pulls content from Netflix. While there are some parents of small kids who primarily use Netflix for the access to Disney/Pixar movies, most Netflix subscribers are there so they can stream many seasons of TV shows with the movies being just an added bonus.

By the way, I found this cool infographic... which came out in 2016, before Stranger Things.



-Jason "now, if Disney/ABC pulls all the ABC and Disney produced TV shows from Netflix, that could move the needle... especially if other studios followed suit" Evans

When was Long Island annexed by Connecticut?

[JasonEvans]

By the way, I found this cool infographic... which came out in 2016, before Stranger Things.

Raise your hand if you had Wyoming as the home of the most die-hard iZombie fans.



Yup, that's what I thought.

[bjornolf]

I find it fascinating/hysterical that Virginia has House of Cards and West Virginia has American Horror Story.

We watched Dr. Strange on Netflix a couple months ago, speaking of Marvel.

[PackMan97]

I LOLered at Utah & Gilmore Girls.

[budwom]

I always find it fascinating that theaters generally charge the same amount for a current blockbuster movie as for a piece of junk few want to see. Not many businesses run on this model.
Definitely not a classic supply and demand situation.

[jimmymax]

That map cracks me up in so many ways: as mentioned Utah => Gilmore Girls plus Montana => Peaky Blinders and Maine => Nurse Jackie. What's up with Scandal? I find that show unwatchable. Re the movie biz: they need to cut production by 50% or more because most of them flat out suck. There are far too many unworthy remakes, dead and beaten horse trends (Super Hero, e.g.) plus your IIs, IIIs and IVs. Yet the price to sit (in an albeit nicer room than years past) with a bunch of talking, popcorn munching, wrapper twisting folks I'd never invite into my living room goes up and up. I think I'm officially a curmudgeon...

[budwom]

That map cracks me up in so many ways: as mentioned Utah => Gilmore Girls plus Montana => Peaky Blinders and Maine => Nurse Jackie. What's up with Scandal? I find that show unwatchable. Re the movie biz: they need to cut production by 50% or more because most of them flat out suck. There are far too many unworthy remakes, dead and beaten horse trends (Super Hero, e.g.) plus your IIs, IIIs and IVs. Yet the price to sit (in an albeit nicer room than years past) with a bunch of talking, popcorn munching, wrapper twisting folks I'd never invite into my living room goes up and up. I think I'm officially a curmudgeon...

that's why we go to midweek matinees...there are often only a handful of people in the theater...plus we get the matinee discount AND the geezer discount...

[JasonEvans]

Pretty interesting that we started this thread only days before MoviePass shook up the movie industry by offering a subscription package which allows you to see 1 movie per day (in a theater) for a flat fee of $10 for the month... a crazy good deal if you even attend 2 movies the entire month.

AMC does not like it and is suing.

In 2016, the service started at $15 per month and ran up to $50 per month for unlimited movies in bigger cities. AMC, which is the largest theater chain in the US said in a statement that MoviePass’ model is unsustainable. The company argued that ticket prices below $10 a month over time wouldn’t be able to generate enough cash to operate quality theaters, nor produce enough income that would allow film makers to make movies of value.

-Jason "I don't think AMC cares if MoviePass goes bankrupt with this money-losing plan, but is worried that MoviePass is going to make folks not willing to pay AMC's regular ticket price" Evans

[94duke]

Pretty interesting that we started this thread only days before MoviePass shook up the movie industry by offering a subscription package which allows you to see 1 movie per day (in a theater) for a flat fee of $10 for the month... a crazy good deal if you even attend 2 movies the entire month.

AMC does not like it and is suing.



-Jason "I don't think AMC cares if MoviePass goes bankrupt with this money-losing plan, but is worried that MoviePass is going to make folks not willing to pay AMC's regular ticket price" Evans

for what are they suing, and on what grounds?

[Blue in the Face]

I'd never heard of MoviePass until yesterday, but I'm confused - both by how it isn't losing money terribly, and by why the theaters would oppose it. From what I've read, MoviePass effectively purchases the tickets from the theaters, at full price, and then transfers them to it's subscribers. A) How could that possibly be economically feasible? Their subscription fee is so low that it's hard to imagine they have many subscribers who under-utilize the service. I'd think that pretty much every subscriber is going to at least 2 movies a month, and many are obviously going to more, so how are they not spending more on tickets than they're taking in in subscription fees. (Maybe it's been high enough to date that they benefit from under-utilization, but at the new price, I don't see how that's remotely possible). B) If the theaters are getting full face value for the tickets used by MoviePass' subscribers, why would they care? If anything, it'd seem like people would go to more movies using MoviePass than they otherwise would, so that's more tickets sold for the theaters. Whether the individuals are saving money at MoviePass' expense should be irrelevant to the theaters. Why is AMC (and my understanding is other theater chains as well) bothered by this? If MoviePass eventually goes out of business, so be it. But in the meantime, they're selling tickets for the theaters. Obviously I'm missing something.

[PackMan97]

Why is AMC (and my understanding is other theater chains as well) bothered by this? If MoviePass eventually goes out of business, so be it. But in the meantime, they're selling tickets for the theaters. Obviously I'm missing something.

I imagine if you are seeing 5 movies a month for $10...and now moviepass is out of business what are you more likely to do? Go see one movie for $10, or 5 movies for $50? It will fundamentally change the way your customers view the value of your product.

that said, I would think the movie industry would really like folks to go to the movies more...I'm just not sure $10/mo is the price point here. It feels far too low.

[Blue in the Face]

I imagine if you are seeing 5 movies a month for $10...and now moviepass is out of business what are you more likely to do? Go see one movie for $10, or 5 movies for $50? It will fundamentally change the way your customers view the value of your product.

I actually think the opposite. I can watch unlimited movies, albeit a few months after release, for a very low price at home. If I get back into the habit of going to the theater instead, I think I'm more likely to continue that in the future, even if the low price offered by MoviePass disappears.

[jimsumner]

If the theaters can continue to get people to buy concessions at 1000 percent profit, they shouldn't care if people get into the theater for free.

Joking. Sort of. Maybe. Kinda.