Movie Theaters Struggle Despite Summer's Super Blockbusters

Movie Theaters struggleAfter a hot start this year, your local multiplex is emptying out again.

Hollywood.com statistics show that attendance during the telltale summer season tallied 533 million moviegoers in North America, nearly 4% fewer than last summer. You have to go all the way back to 1993 to find the last time fewer tickets were sold.

Last year was the first year since 1995 that domestic theaters failed to sell at least 1.3 billion movie tickets. Are we in for another repeat performance?

Strong Start, Weak Finish

Summer matters. Studios tend to put out their biggest blockbusters during the hot months, when a long break from school makes an air-conditioned movie theater an ideal escape.

Studios may save their more artsy critic-pleasing releases for the end of the year to lobby for Oscar nominations, but summertime is all about big action, big stars, and big ticket sales.

The season got off on the right foot.

Disney's (DIS) The Avengers took in a super-heroic $207.4 million in North American ticket sales during its opening weekend, obliterating the record established by Harry Potter and the Deathly Hallows: Part 2 a year earlier.

The Dark Knight Rises and The Amazing Spider-Man followed with strong ticket sales in July.

August is when things began to fall apart. Despite healthy marketing for The Expendables 2, the politically timely The Campaign, and the Total Recall remake, there wasn't a single August release that topped $100 million in North American ticket sales.

The Problem of Empty Seats

Movie studios obviously don't want to see folks shying away from the multiplex, especially if it becomes a longer-lasting trend.

Exhibitors and publicly traded companies including IMAX (IMAX) and 3-D outfitter RealD (RLD) also are hoping that this late fizzle to the once-sizzling summer season is just a fluke. Their entire business models revolve around drawing crowds to screenings.

A few factors are at play here. High-def TVs -- and even HD sets with 3-D capability -- are getting cheaper. Movie studios are narrowing the release window between a film's theatrical release and its availability for rent or purchase. There's also the digital revolution, giving homebodies more programming alternatives without having to head out to the closest movie theater.

Sure, there's still the allure of freshly popped popcorn, even though concession prices now border on the ridiculous. A date night at the movies is still an iconic outing, even though renting a movie has never been easier.

Hollywood had better make sure that it comes back strong next summer. Three straight declines during the industry's most potent season would be an ugly trend that no studio can ignore.

Longtime Motley Fool contributor Rick Munarriz owns shares of Walt Disney. The Motley Fool owns shares of IMAX and Walt Disney. Motley Fool newsletter services have recommended buying shares of IMAX and Walt Disney.



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Richard

I used to go to see movies 2-3 times per month at my local AMC. Tickets before 6:00 on weekends were $5.00 each and a large popcorn was $4.00. The AMC Movie Watcher program was a good value with every 10th movie free and every 5th getting a small drink or popcorn (you coul pay difference for a large). Now everything has almost doubled and their frequent movie watcher program as few benifits plus an annual fee! Now we go once a quarter and we will not patronize the snack bar. This seem analogous to the way our government thinks. They think that ther is no limit to what they can increase ticket prices to in order to maximize profits. As a kid the Saturday afternoon $2.00 matinees were packed and kids loaded up on affordable snacks. I think many have decided to wait until the discount theaters get the movies they want to see. Let's not ven discuss NY and LA prices!

September 08 2012 at 1:00 PM Report abuse rate up rate down Reply
runswthscisors40

When you have to pay 9.00 for a ticket, and then 3.00 extra for 3D, you're pricing yourself out of the market.......between the wife and myself, it cost 25.00 for 2 popcorns and 2 drinks........we bring our own food and water now......thank you Mio!...............

September 08 2012 at 10:35 AM Report abuse rate up rate down Reply
lthrnck68

Simple. People are fed up with the high cost of movie tickets, the before movie commercials and the high cost of concession items. Makes some good and even some great movies unattractive. I have found it easier to just wait for the DVD and renting it once it hits RedBox.

September 08 2012 at 7:37 AM Report abuse +1 rate up rate down Reply
NomadBud

20 dollars to get in , and 20 dollars for 2 soda's and 2 popcorn . They can stick it .

September 08 2012 at 6:18 AM Report abuse +2 rate up rate down Reply
Bon

if you make the prices affordable again then maybe people will go back. It's $13 for me to see a movie in my area and that's without snacks so for that much I can wait for the dvd to come out to own rather than sitting in a movie theater with all the germs and people that can't shut up and watch. Oh and let's not forget the nuts that suddenly kill at random now too.

September 08 2012 at 1:05 AM Report abuse +2 rate up rate down Reply
Brian

Making movies available online as well as DVD rentals and sales, have made huge impacts on the way we watch movies. With the recent shootings Colorado, it creates even more incentive to stay home and safe for a nice movie. Times are changing and movie theaters must adapt to these market forces or be left in the dust of the past.

September 08 2012 at 12:40 AM Report abuse +2 rate up rate down Reply
ides315r

No Hollywood star is worth more than one million dollars per picture, period. Times are tight, and so-called "stars" are just going to have to do without like the rest of us. Also, I'm not watching as much TV like I used to because my favorite shows keep being chopped up to make room for those boring commercials. Hey, advertisers, people are playing their favorite music videos during the commercial breaks. They may not be playing Blondie and Debbie Harry like me, but I'm sure those Lady GaGa fans are watching her stuff instead of your things. If the channels give you a lot of advertising time in a half hour, you can be that nine times out ten, you're not getting your money's worth.

September 08 2012 at 12:33 AM Report abuse +1 rate up rate down Reply
brainsell

Movies today are a nightmare. People eating popcorn with their mouths open, not only is this distracting but it shows bad manners. The popcorn stinks, as we have to breath it in. Unwrapping candy during the movie, distracting cell phones ringing, people talking on cell phone, people constantly checking their cell phones for messages So called actors being paid millions of dollars per movie for what? The same boring actors appearing time and time again! This not a pleasurable experience it's a nightmare. No wonder the cinemas are empty and have no future. They have forgoten the first rule of marketing 'give the customer what they want'.

September 07 2012 at 11:12 PM Report abuse +4 rate up rate down Reply
bjw367

AMC was recently bought out by a Chinese Government financed company... Dalian Wanda Group....In order to increase profits the prices of popcorn and soda have skyrocketed. The new big bag is the old medium bag, the new medium bag is the old small bag, and the new small bag.....half the size of the of the old one. The price of drinks are up as well. The new small cup is 3/4 the size of the old one. Seven swallows and its contents are gone......... The total price $44.00 for two individuals (depending on State and time) $24.00 + for tickets and $20.00 for drinks....Why would anyone be surprised that theater attendence is down?????

September 07 2012 at 10:52 PM Report abuse +1 rate up rate down Reply
moboman72

Unfortunately the industry hasnt figured out that the way to sell tickets, is to keep the prices reasonable, and turn down the volume. LOUDER isnt better. Folks go to the movies to experience the tale, not feel the sound waves. Combine that with big screen sets and HD quality, and its no comparison. And you can pause and go to the kitchen for reasonably priced snacks.

September 07 2012 at 10:00 PM Report abuse +1 rate up rate down Reply