The Evolution of Film Viewing
For over a century, movies have been a large cultural phenomenon. As long as film has been around, audiences have been captivated by the moving images. While the technology, techniques, and quality of films has increased dramatically throughout the decades, the medium in which they have been distributed has not evolved as much. That is until the last decade where movie streaming platforms have risen in popularity and gained millions of subscribers.
When you think of movies, what comes to mind? Large movie screens? buckets of popcorn? A movie theatre of course. It is the staple when it comes to viewing any new movies, and it makes sense. Theatres are where the newest releases are available. Why would you wait for a movie to come out on DVD months later so you can watch it on a small TV screen? The grand spectacle of a movie theatre is the best option and always has been, right? Well that maybe not be true for some.
According to the National Association of Theatre Owners, the number of cinema locations in the U.S. has been on the decline. From 1995 to 2018, locations around the U.S. have closed or gone out of business in large amounts. On average, each year, there has been a downward trend for how many locations are open. There are a variety of factors that can be attributed to this decrease. The rise in popularity of streaming services like Netflix is one. They have caused movie theatre owners to adjust their tactics to survive.
While the the total number of cinema locations has been on the decline, revenue is quite the opposite. It is actually generally trending upward. In 2018 U.S. Box Offices recorded almost $12 Billion in revenue. That is an impressive revenue total, but one that is not even the top. Netflix’s revenue surpassed the revenue of movie theatres by a substantial amount. The streaming service, reportedly earned just under $16 Billion in 2018. The revenue of Netflix has risen almost exponentially from 2002 to 2018. Even though streaming services such as Netflix may be taking costumers away from conventional locations, theatres don’t appear to be losing profits in general.
Films today are generating more revenue than ever before. Blockbusters rake in billions of dollars each year, some doing it single-handedly. This has helped keep movie theatres in the green. Another factor that has contributed to their success, is the continual increase in ticket prices for movies. This change in pricing has allowed movie theatres to compensate for the loss of locations. That being said, it does not appear to be a permanent solution.
Raising prices will only work for so long. That is until a majority of movie-goers can’t afford to buy tickets. This, coupled with streaming service popularity and a general decrease in locations will present cinemas with a very tough challenge. As Netflix and other competitors continue to grow, cinemas will need to offer more and more to consumers to draw them in, aside for blockbuster movies.
