What Ripple Effects Will COVID-19 Have on Movie Theaters and the Hollywood Film Industry?
Every trade and industry across the world has been decimated in one form or another by COVID-19. The wide scale impact it has had has been truly unprecedented, and the larger ramifications this will have on the entire world going forward are incalculable. Just in the film industry alone, we have seen COVID-19 grind everything to a halt.
Movies that were supposed to be in theaters now have been delayed, and some indefinitely. Movies that were supposed to be shooting now have been suspended. Movies that were supposed to be in post-production are currently untouched. The movie theater industry has also been devastated, as most if not all theaters remain closed. Movie theaters and the Hollywood film industry have a symbiotic relationship, and COVID-19 has crippled both. What ripple effects this will have on these industries, and whether both can come out on the other end, still remain to be seen.
Movie theaters were in a state of decline even before COVID-19. There is a razor-thin margin of profit, with the movie studios taking in most of the money generated from ticket sales. Where theaters make their profit— and how they’re able to keep the lights on — is with concession sales. In addition to this, over the last decade we have seen streaming come into its own as a viable option for viewing content.
The biggest development has been big films that normally would have exclusively populated the big screen, such as Martin Scorsese’s 10-time Oscar nominated film The Irishman, debuting on a streaming service. This game is changing. While the movie theater experience is truly unrivaled, and most dedicated cinephiles will always opt to see something in theaters rather than on their phone, there are a lot of people out there who don’t care about the quality of their viewing experience. Watching a movie on their 4" x 6" phone is just the same as watching a movie on a 50' x 30' theater screen.
Movie theaters are not dead yet, and many would be forgiven for being surprised by the notion that movie theater attendance is waning (2017 saw a 25-year low). How can it be waning if Avengers: Endgame broke records just last year for the biggest domestic opening weekend of all time with $350 million dollars (shattering Avengers: Infinity War’s record of $250 million the previous year), and also became the highest grossing film of all time with $2.79 billion?
What we’re finding is a disparity in the kinds of movies people see in theaters. Big event films such as Avengers will draw the crowds because people don’t want to be spoiled. Part of the “event” is that you need to see the movie in its opening weekend before any of the spoilers leak. But while the big blockbusters get a lot of butts in the seats, smaller films do not. The reality we are seeing is that big movies attract big audiences and smaller films attract smaller audiences.
So where do we stand currently? The movie theater industry is already in decline, and is now completely shut down because of COVID-19. The film industry as a whole is at a standstill; and now all of the big movies, the films that movie theaters depend upon to get people into the theaters so that they can buy concessions, are delayed.
Some 2020 films such as Fast and Furious 9, Minions: The Rise of Gru, Ghostbusers: Afterlife, and Morbius, have moved to 2021. Other big films that were supposed to come out any time between April and August have moved to the fall or winter. The summer movie season is always when the biggest films come out each year, but this summer that prospect is gone.
When theaters do re-open, they won’t immediately be flooded with new releases. The studios need to have a couple of months at least to ramp up their marketing campaigns to build awareness for the film before it opens. And with it being completely up in the air right now as to when theaters will re-open, studios can’t dump tens of millions — even hundreds of millions — of dollars into marketing a movie for a certain release date if they don’t know for sure the theaters will even be open on that date.
That’s why movies set for July and August are moving. The theaters very well may be open by then, but those movies can’t be marketed with their July or August release dates without assurance that the theaters will in fact be open on those days.
The result is a large window of time in which the theaters are closed, and then a window of time in which the theaters are open but with no new movies. China tried re-opening some of their theaters just a couple of weeks ago, showing re-releases of Avatar and Avengers, before they very quickly had to be shut down again.
Even when the North American theaters open again, there will be a lot of people apprehensive to sit in a closed-off room full of a couple hundred strangers. There also won’t be anything new to entice them to come out. It may be until September or October before anything new really comes out, assuming all of these projections aren’t pushed even further if COVID-19 worsens.
So what’s the logical trajectory here? Just from the shut down alone, many smaller movie theaters will have to close. They won’t be able to afford to re-open. The bigger chains, like AMC or Regal, will be hurt badly but probably not enough to close their doors entirely. If months go by where they can only show either re-releases and smaller films, without having a Black Widow or a No Time to Die to bring the masses in, there’s no telling what could happen. AMC is the biggest movie theater company in the United States, but even they are susceptible to going out of business should things unfold in this manner.
If they shut down initially in early March and aren’t able to show any big blockbuster films until November, that very well may kill them. Additionally, with so many people already accustomed to watching movies at home, that habit has been reinforced during their self-isolation. As a result, by the time the movie theaters re-open, there may be a large group of former moviegoers who decide just not to go.
This isn’t to say that we will see the definitive end of movie theaters over the next year, but consider what effects this will have on the Hollywood film industry. Let’s put aside the potential of major chains like AMC and Regal closing their doors, and just say that a lot of smaller theaters close with AMC and Regal shutting down only some of their theaters across North America. Even this changes the Hollywood film industry radically.
If there are less screens to show movies on, there will be less money generated from the movie theaters. If there is less money generated, not only will the movie theaters suffer even more, but the the movie studios will be making less money and will be forced to curtail both the amount of money they put into movies and the amount of movies they produce. If movie studios are spending less money on movies and are making fewer movies, fewer opportunities will be given to up-and-coming filmmakers, many of them being women and people of color.
The horrible reality of Hollywood is that films made by women or people of color starring women or people of color are seen as “risks”. It’s disgusting, but that is how it is viewed. This has been changing over the last decade or so, with movies like Black Panther and Wonder Woman making lots of money at the box office and gaining great critical acclaim, but when the chips are down, the studios will revert back to their original ways.
It doesn’t mean there will be no movies made by women or people of color, but there will be fewer of these films made and studios will be less inclined to take what they deem as risks. In an industry where studios make a great deal of money off the big blockbusters and are able to finance smaller films, they feel comfortable taking “risks”, and so they then feel comfortable financing movies made by women and people of color.
Take this for example: In 2017, Universal Pictures made Girls Trip, a comedy featuring women of color in the leading roles, written and directed by people of color. It was well liked by the critics and fans, and did very well at the box office for its budget. However, Girls Trip is the kind of movie that lost Universal money it wouldn’t ruin them, nor is it the kind of movie that Universal can depend upon to keep the lights on. It’s movies like The Fate of the Furious and Despicable Me 3 that came out in 2017 that Universal depended upon to make them billions of dollars and, with that profit, they’re able to spend $19 million to make Girls Trip.
I’m not here to defend the movie studios and their way of thinking, but I am here to break down the reality of how they think and how they act. A lot of filmmakers that are women and people of color are financed because studios have a lot of profit coming in from their big blockbusters (and in later years some of those blockbusters have been made by women and people of color).
When people stop going to the movie theaters as often, when movie theaters have to close their screens, when movie studios make less money, when movie studios have to spend less money and green-light less films — the people who will ultimately suffer are up-and-coming filmmakers who are women and people of color who have yet to have a chance to prove themselves to the studio executives. If they’re deemed as “risks,” when there’s less money coming in and less money to be made, studios won’t want to do what they consider to be risky.
The ramifications of COVID-19 on Hollywood and the movie theater industries remain to be seen. It won’t be good; that much we can say now. A lot of people will lose jobs, a lot of companies will go out of business, and a lot of industries will lose a lot of money. At the end of the day, an industry that has so long been stacked against those who aren’t straight white males will favor those it has always favored. Less movies will be made, and thus less voices will be heard.
Ultimately, movies that don’t have clear-cut wide-scale marketability will suffer. I think the most we can do, as movie fans, is support movie theaters and support independent films made by women and people of color, and hope that it’s enough to soften the blow these industries are going to take as a result of COVID-19.
