Or did they lock it? Remember when people said that videocassettes and DVDs would destroy movie theaters, well the U.S. Government “un-did” what they enacted over seven decades ago.
A continuation of the previous post.
The Future?
The independent theater operators (and drive ins) will probably be hindered by the termination of the Paramount consent decree. Recently, the pandemic has significantly hurt the movie theater market, reducing ticket box office sales to $2.06B in 2020; down from $11B in 2019.
Some thoughts …
- Will the migration of movie viewing from theaters to streaming continue after the pandemic subsides?
- Can theaters endure and outlast the past threats of television and other home movie viewing (video cassettes, DVDs and cable) and return to a viable option for entertainment?
- Will the production entities leverage their content inventory for their own purposes?
At some point, we will want to breakout of our homes from this pandemic shutdown. We want to socialize. Even with the wall-sized televisions in our homes, nothing can replace the wide screen theater experience.
Therefore, the next logical question is … how can movie theaters compete in a post-pandemic environment?
- Create a partnership alliance between a streaming service and movie theater chain to offer attendance at first-run movie viewings at a theater. With the incentive of a free showing of a movie (re-run) on a streaming service. A win-win solution; box office sales and subscription increases.
- Re-branding a movie theater as an entertainment environment with family and friends. Preferential seating and reservations for special seating to view a movie for subscribers to a streaming service.
- The purchase of a movie theater chain by a streaming service. Seems counterintuitive, but now it is completely legal right?!?
In a historical context, many did not believe that the Breakup of the Bell System was possible. It happened!
In American economic, capitalism, political and societal changes, there can be waves of policy changes throughout historical periods. Consider the upcoming political and legal environment relating to companies that have the attention of the Justice Department, state attorney generals and Congress. The sharks are circling as we read.
But, how could the production and content industries lose their newfound success?
- Create anti-competitive restraint of product distribution (price, timing, block booking) to venues other than their own streaming service,
- Implement a favorable supply chain distribution of content to alliances and/or subsidiaries,
- Merging or acquiring a streaming service; creating more industry dominance, and/or
- Consolidation of market and subscribers from a fragmented to a monopolistic market.
Thoughts
Technology changes too quickly for organizations and individuals. And yes, governments. But, Pandora’s Box has been opened!
The recent strategic decisions of HBO, Disney, AT&T and other organizations clearly say that this is a “work in progress.” And more recently, Wonder Woman exceeded box office forecasts to for $16.7M; North America’s largest, post-pandemic opening weekend for any feature film in 2020. However, this movie earned a fraction in domestic ticket revenue ($412M) as compared to the first series release three years ago.
Do you get the impression that we are watching the upcoming movies teasers before the feature film?
I do! The plot and the ending of this situation is far from over.