Death to Movies?

Movie theaters were once a booming industry before the invention of TV and video games but what about now in 2012? Well according to business insider it’s not, summer ticket sales dropped nearly 20 million from 545 last year to 526 million summer 2012. But it's not just this year that summer ticket sales have felt a slump, they've been on the decline for the past decade.

Now let’s consider what could possibly be affecting these ticket sales. Could it be that now sine everything is coming out in 3D or I MAX, are ticket prices just too high for people, so they choose more important things to spend their money on. In this down economy you have to consider people don’t want to spend nine dollars a ticket to go watch a movie. Think about a family, multiply that by three for a small family and that’s 27 dollars and that’s not even counting snacks. The point I’m getting at is that they are starting to charge way too much for ticket prices and even the snacks in the theater. From my point of view I’m not going to go waist almost 10 dollars for maybe 2 hours of entertainment, when I could watch Netflix or do something more constructive with that 10 dollars like buy food or even gas.

Another thing that could be affecting the sales is the boom of cable TV and premium cable channels. You can sit at home and be comfortable and not deal with all the extra spending and the crowds. Netflix could also be affecting the movie theater with the convenience of being online and on video game consoles. Another thing that could be affecting ticket sales is renting from red box, just like the guy in the CBS video. CBS said they are losing young men as viewers of movies, it’s because they don’t want to spend their money on that, when they have the entertainment like all of the items listed above and video games.

But now I must look at the opposite side now while ticket sales are down thanks to the increase in ticket prices movie industry is still bringing in huge amounts of money. The prices of tickets have off setted the unwillingness of most to go to the movie theater so even with ticket sales decreasing movies are not losing profits.

Some of the proposed ideas to increase ticket sales are good most are just down right ridiculous. Some movie theaters have cracked down on texters and people talking on the phone to bring back the 30 to 40 year old crowd. Tim League, CEO and founder of the Texas chain, credits a take-charge approach: His theaters threw out more than 100 moviegoers for talking on cellphones or texting because they distracted other viewers.  But I have little faith that this will increase ticket sales all that much more and think about the people he kicked out they probably aren’t too happy either. Others have said to adjust the concession prices like in the CBS video but unlike that one girls opinion no one wants to spend four dollars for a box of candy are you kidding me. If you really want to get people to come, lower concession prices, then people might consider actually coming because it actually would make it more affordable.

One idea that I have that would probably help out movie theaters would be is to drop ticket prices maybe if you did that you would actually get the younger important demographic to come. Most of us do not want to spend that much money because we are in college and already in debt. Maybe if they thought about that they would make the smart business move and drop the prices.

Now to the final issue of the balancing of creative and commercial practices in the CBS video, yes a good movie will draw a crowd no matter what, is it really balanced when you consider the ridiculous prices and inconvenience of a movie theater. While yes the creative practice side of it is great you can see that with movies like Marvel's The Avengers $623,279,547 gross and Batman “The Dark Night Rises” $446,792,585 gross, the commercial side is still a bit unbalanced because of a down economy. Even though with the down economy ticket prices continue to rise and may even start to raise more for 2D movies. So my take on this whole scenario think about the commercial side more at least until the economy is back then maybe you might get my money but not likely.

Digging Deeper: What are movie theaters?

    There are several different reasons I believe movie attendance is down.  Seven years ago when I was in seventh grade, there was no such thing as Netflix, Redbox, Hulu, or even 60 inch plasma HD t.v.'s.  Yes, there were such things as 60 inch televisions, but they weren't so crystal clear that you could literally see a blemish on a reporter's face.  Increasing technology is giving a crucial beating to the movie theater business.

    The first big technological advance that is hurting the movie theater revenue the most is the recent development of streaming of movies through Netflix, Hulu, etc.  For Netflix, you pay a small fee of, I believe, eight dollars a month.  Crap, one movie ticket at a theater costs eight dollars.  Why pay eight dollars (not including the five dollar drink and six dollar popcorn) for a ticket to see a movie when you can watch unlimited movies on Netflix for the same price?  Every movie will have its loyal followers that will spend this kind of money to see a midnight premiere, but it does not make sense to go out and pay this kind of money if you are not completely infatuated with what is playing.

    One might say "Netflix does not come out with the latest, greatest movies that just aired in theaters." This is where Redbox comes into play.  Unlike Netflix, Redbox displays most of the latest, greatest movies that just left theaters, and most importantly, for the slim price of $1.20!  They do not come out right away, but if you wait, you will save money.  The Sunday Morning piece gave a perfect example of this.  Jeremy Remudo, instead of paying eight dollars to see a movie in theaters, waits until the movie comes out on Redbox and saves himself about seven bucks.  That's a meal at Whataburger.

    This leads us the the second major technological advance that is devastating to the movie theater attendance/revenue.  The television industry is booming.  Not only are the TV's getting bigger, they are getting smarter, louder, and more crystal clear than ever.  If movie fanatics pay eight bucks to see a movie in theaters, chances are they have a flat-screen TV now days.  I was watching an advertisement the other day about Sharp.  They just released the biggest LED TV in the solar system at 90 inches (you can watch the video here).  Why would anyone want to pay to see a movie when you can watch it on a jumbo-tron in the comfort of your own home?  Granted, most people do not have the money to go out and buy a 90 inch TV, but this is another advance that is hurting the movie theater industry.

    As you know, most movie theater's are not theater's if they do not have middle school and high school aged kids in them.  I guess you could say this is part technological advance that hurts attendance, but it is mainly a distraction problem.  With the increasing amounts of smartphone/iPhone users, there are many more things to do while sitting through a movie than simply "text."  Middle schoolers and high schoolers are in the "cool" stage where they do not care about the older folks who are actually trying to watch the movie.  They will sit through the whole movie giggling and gaga-ing about Sam's latest Facebook or Twitter post, oblivious to the people behind them.  There is a recent article that goes along with this.

    These are some examples of things hurting the movie theater industry.  I will try to come up with a few solutions that could possibly work.  I do not know how easy it is to just "drop" prices because it probably does not work that way, but I'm sure they would gain more attendance and revenue if they would offer specials for certain types of age groups during certain types of the week.  For example, have a "college night" where tickets are half-off, or a "high school night" where tickets are half-off as well.  Just something along those lines.  Believe it or not, Sherman, Texas used to have a Dollar Movie Theater.  It was similar to Redbox in that they would release movies a few weeks later than regular theaters, but only charge one dollar to see the movie.  Granted, food and drinks were still higher than a tree.  Notice I said Sherman "used" to have one.  It has since closed down.  I figure if a company can figure out a better way to run something like this, it could have the potential to be very successful.  Lastly, I think movie theater's should more strictly enforce the "texting" and "high school drama" that goes on in theaters.  All of these could have the potential to gain more attendance/revenue for the movie theater industry.