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Movie Theaters Watch Their Audiences Dwindle

Corrina Shuang Liu |
October 5, 2012 | 6:06 p.m. PDT


The following is part of our series wading through the economic jargon, Crunching Numbers.


The box office hit its lowest record in over ten years after Labor Day, predicting a possible change in one of America’s favorite pastimes: Going to the movies.

According to BoxOfficeMojo.com, ticket sales totaled $67 million the weekend of Sept. 7— the lowest since the second weekend after 9/11 in 2001. Furthermore, the top-grossing movie, The Possession, only brought in $9.5 million. The last time the most-watched movie grossed less than $10 million was in 2008, according to Hollywood.com.

Audience attendance in theaters has been down by 4 percent since 2002, according to a report by The Motion Pictures Association of America. It’s a trend that distribution companies and theaters all have to respond to, either by changing the business model or providing better services.
“The broader picture here is that people’s habit of going to theaters is changing,” said David Weitzner who has extensive experience in entertainment marketing and now teaches the business of entertainment at USC’s Cinematic School of Arts.

“And this will lead to a change of the business model of distribution companies.” He added that some distribution companies have reversed the traditional distribution process, which involved releasing movies at theaters first and then to Video On Demand. He also believed that more companies would adopt the model in the future. 

(Courtesy of Motion Picture Association Of America)
(Courtesy of Motion Picture Association Of America)

The change may take years to happen, as people are still going to theaters for social outings or for 3D films. Though theaters still have time to attract more moviegoers, it may also be time to rethink the future of the movie distribution industry.

Historically, the box office following Labor Day reports lower numbers than summer weekends. But this year, the numbers were even worse due to the lack of big movies on screen, said Silvia Torres, manager of Flagship Theater near USC.

Add this to the fact that fewer and fewer people have been going to theaters in the past decade, and it becomes clear that this year was not an isolated drop. It resonates with the trend.   

As Weitzner said, when people decide whether they will go to theaters to watch a movie, there are many factors that influence them. For example, the costs of food and drinks at a theater affect families’ decisions more often in a bad economy. 

“But generally speaking, Americans have already watched many movies on the big screens. Now their demand is ‘I watch what I want and where I want,’” Weitzner said.

Read more from Neon Tommy's Crunching Numbers series here.

Reach Contributor Corrina Liu Shuang here.



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