Worst Box Office In 25 Years: Hollywood’s Problems Are Permanent & Deep
Even before this catastrophic Labor Day weekend is factored in (more on this below), the domestic 2017 box office is in hideous shape. This year is –6.3% behind 2016 and continues to fall behind 2015, 2013, and 2012.
If you figure in inflation, those numbers are even worse.
For example, in 2012 the average ticket cost $7.96. Today it is almost a full dollar more at $8.89. Yeah, things are that bad and will look even worse on Tuesday.
With no apparent faith in their own product, this is the first Labor Day in 25 years where a new title has not been released on more than 1,000 screens. Over this weekend last year, the box office hauled in nearly $130 million. This year will do about a third of that.
Summer attendance is at a 25-year low.
The summer box office is down a whopping –16% compared to 2016.
….Hollywood has had bad years before and it was not the end of the world. This year feels different, like we have crossed a Rubicon. Investors appear to agree.
We begin with the fact that some 15 years ago, the movie business stopped being a growth business. While revenues have increased a bit, admissions have remained stagnant. Those revenues were boosted through premium priced gimmicks like 3D and Imax.
…Anyway, that is just a summary of the lay of the land. Hollywood’s fundamental problems are much deeper and fall into three categories: product, ideas, and customer service.
The ideological conformity within Hollywood is not only destroying the greatness that comes from artistic tension, is not only shelving great stories, it is alienating and insulting half the customers.
…Going to the movies used to be a form of escape from the tyranny of everyday life. No more. Around 80% of movies disappoint, the rudeness of others aggravates, and the hyper-politicization of too much of the product and its pitchmen (the actors) drains your ability to remain spellbound.
…The number of tickets sold in the United States and Canada this summer is projected to fall to the lowest level in a quarter-century.
And the number of actual tickets sold this summer paints a bleaker picture, with total admissions likely to clock in at about 425 million, the lowest level since 1992, according to industry estimates.
No one can fully explain why. Studio executives, movie theater operators and analysts cited the usual explanations for the summer slump. There are the obvious reasons:
Too many bad movies, including sequels, reboots and aging franchises that no one wanted to see. Some point to rising ticket prices, which hit a record high in the second quarter, according to the National Assn. of Theatre Owners.
Then there are long-term challenges, including competition from streaming services such as Netflix and the influence of the movie review site Rotten Tomatoes. How about all of the above?
….Some worry that summer movies have simply lost their place as the top entertainment touchstones American consumers are talking about, as acclaimed shows such as “Game of Thrones” on HBO and “The Handmaid’s Tale” on Hulu dominate the cultural conversation.
“The floor beneath the entertainment market is not as stable as it was 10 years ago,” said Jeff Bock, box-office analyst with tracking firm Exhibitor Relations. “There’s a lot of different things that monopolize people’s discussions, and most of them are not movies. The product is just not worth talking about.”
…..But so-called sequel fatigue doesn’t explain the success of “Guardians of the Galaxy Vol. 2” and “Despicable Me 3,” which were both big moneymakers.
R-rated comedies, usually a reliable source of studio profits, also fell on hard times this summer. Four out of the five major releases disappointed: Fox’s “Snatched,” Sony’s “Rough Night,” Paramount’s “Baywatch” and Warner Bros.’ “The House.” “Girls Trip” was the one exception, notably, after earning critical acclaim.