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Box Office Panic! Part I

Are people going to the movies less? Are they just waiting to huddle around their televisions, or laptops or phones!! to see the latest and greatest Hollywood has to offer? Are they shifting to binge watching, instead of even getting out of their Barcalounger? Will we soon look like the characters riding wheelchairs in WALL-E?

You are here: Home / Our Thinking Lately / Box Office Panic! Part I

November 4, 2017 By JNH Leave a Comment

Some in Variety, in the Hollywood Reporter and other outlets have been panicking that this down movie ticket year is the death knell of movies in theaters. I am no Pollyanna, but I heard this story in 2005 as well, of course coming off of the sterling year which brought us The Passion of the Christ. The rise of digital delivery systems, and the changing of the generations made me want to dig into this discussion.

Are people going to the movies less? Are they just waiting to huddle around their televisions, or laptops or phones!! to see the latest and greatest Hollywood has to offer? Are they shifting to binge watching, instead of even getting out of their Barcalounger? Will we soon look like the characters riding wheelchairs in WALL-E?

What Is The Result Of Some Of This Digging I Was Drawn To Do?

I gathered and arrayed a host of numbers, starting back in the early nineties, but decided it would be easier to see the effects by focusing on the last fourteen years, as 2017 is still in progress.

I gathered from 2003 through 2016:

  • Population of the US
  • Screens in the US
  • Box Office
  • Tickets Sold
  • Average Ticket Price
  • Factor for Inflation-Adjusting Each Year to 2016

These numbers gave me several vectors to plot, in order to see what is really happening/happened over these fourteen years, to get a handle on whether an off box office year seems like a death knell, or is not so uncommon.

So, let me first show you the “non-adjusted” box office, for comparison.

This is the kind of chart you would get if you just took MPAA numbers each year and plotted them. It looks like we are almost always rising, or, if not always rising, then rolling through hills always upward trending, while experiencing very shallow valleys.

Because I know the number of citizens, and I know the box office of each of these years, I decided another important measure might be seeing how much each citizen is “spending” each year to go to the movies (inflation-adjusted to 2016) and what the box office tally was each year (also inflation-adjusted to 2016).

This is a quite different impression than the one we get from the first chart, inflation-adjusted to show what the real economic story is: one of fairly sharp rises and pretty steep falls in real value. This is likely due to the response of the citizenry of American moviegoing to the goods on display that year. But that is a speculation, and we don’t actually know that yet. What we do know is, box office is not a sweetly-rolling ride up and up, but a kind of roller-coaster experience.

Nonetheless, the high of 2003 and 2004 has never been seen again in this chart, but for 2009, the last year of the 2007 recession. What is also clear, though, is a decided trend downward, in real dollars, of the per capita spending of Americans on going to the movies. About five bucks per person downward over these 14 years we are studying. Are we on a long downward slide?

I will be back next week with more items to look at, as there are many factors involved in this story, and I want to get to the bottom of them.
END OF PART I

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What originally caused me to begin FilmProfit® was my noticing that the studios and big players had lots of folks to help them figure out how to make their films profitable. Indie producers were in a gunfight to which they brought their rubber stage knives. I wanted to give them some weapons to begin to level the playing field a little. The things I do, whether for rump indies or mid-level players, or even the studios are meant to get down under the hood, not just numbers, although numbers tell a story, but to get at the functions, of moviegoers, exhibitors, distributors, marketing, and all the working parts of the industry, to help my clients see better what they are getting into and how to prepare for it.

Onward and Upward

Jeffrey Hardy

Filed Under: Our Thinking Lately Tagged With: Box Office, film business plan, movie business

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