The Outlook for 2018
Despite one of the worst summers in a decade at the box office, worldwide theatrical movie revenues jumped to a record $39.92 billion. This gain came despite a 2.3 percent slide in the U.S. box office. The final totals were $28.8 billion internationally and $11.2 billion in North America.
On paper, the release schedule for 2018 looks very strong. But there are also a number of major happenings that will affect the industry this year—just how much, we do not know. Here are a few:
* The Walt Disney Company acquiring 20th Century Fox Film Studio
* The impact of the AT+T merger with Warner Bros.
* The takeover of Regal Cinemas by CineWorld
* The impact of Netflix streaming on both distribution and exhibition
* The prospect of more acquisitions of Hollywood studios when the Disney and AT+T deals are done
* The effect of the MoviePass scheme on exhibition
* The question of who will pay for the upgrade of digital equipment when it needs to be replaced
* The eventual arrival of premium video-on-demand, perhaps in 2018
With all these developments, there is one thing we can count on: People still want to leave their homes for a night of entertainment, and a movie theatre delivers that experience. It’s noteworthy when top filmmakers stress the importance of seeing a film in a cinema; recently, in an interview with The New York Times, Greta Gerwig and Aaron Sorkin, Directors Guild nominees for Lady Bird and Molly’s Game, respectively, expressed their views on the cinema experience.
Gerwig said that she “has a soft spot for the experience of watching films in a movie theatre.” Paraphrasing writer and film editor Walter Murch, she observed, “Being in a movie theatre puts you in a place of both collective experience and vulnerability that is impossible to achieve at home… Going to the movies always starts with one person saying to another, ‘Let’s go out.’ And that means that you are willingly taking yourself out of your comfort zone and allowing yourself the possibility of transformation.”
Sorkin agreed with Gerwig, stating, “I want to believe that nothing will ever replace the experience of being in a theatre with a group of strangers as the house lights go down.”
That magical experience is what keeps patrons coming back to the cinemas—and good content and a great presentation will continue to keep it alive.
Millennials Are Moviegoers
In early December, a very busy time for theatres in North America, Fandango polled more than 1,500 Millennial moviegoers, ages 18 to 34, about their moviegoing habits, plans for the holidays, and amenities they enjoy at the cinema.
Millennials are key drivers for the industry and Fandango through its digital following continues to help innovate and drive more of them into theatres. Fandango's findings highlight the incorrect assumption that young adults would rather stay at home with a streaming movie or a videogame than go out to the cinema.
When asked about their holiday movie plans, 34% of the respondents said they planned to see four or more movies, while 86% said they planned to see at least two. In the February edition of FJI, Adam Rockmore, Fandango's chief marketing officer, elaborates on those findings. He observes that Millennials are going to the movies, but the key is the right movies. And not only do they want to see the most-anticipated films but well-reviewed non-blockbusters as well. Again, when it comes to moviegoing, the old adage applies: “Content is King!”
Breakthrough in Saudi Arabia
Recently, we reported that Crown Prince Mohammed bin Salman Al-Saud of Saudi Arabia had ended the prohibition on movie theatres as well as announcing a royal decree permitting women the right to drive and allowing sports stadiums to open their doors to women for the first time.
AMC Entertainment has signed a non-binding memorandum of understanding with the Public Investment Fund of Saudi Arabia to explore a range of commercial opportunities for collaboration that will support the growth of the Kingdom's entertainment sector. An official rollout date is undetermined, since there are certain issues that need to be addressed before a full go-ahead is granted. Open questions include the types of films to be allowed and whether the cinemas will be segregated by sex.
Despite any initial obstacles, this is an important change to the international landscape. The Middle East in general has seen strong box-office growth in the past few years. With 65 to 70% of Saudi Arabia’s population under 30, robust business is projected for the future. More seats in more theatres means higher box office, and this is very good for the industry.