Low summer box office returns are causing a stir among those in the media industry. While the 2017 summer featured a number of big-budget superhero movies like Spiderman: Homecoming, Wonder Woman and Guardians of the Galaxy Vol. 2, along with critically acclaimed films like Dunkirk and War for the Planet of the Apes, moviegoers still went to the theater at historically low rates. This steady trend is causing alarm for many in Hollywood.
In an entertainment landscape dominated by “peak TV,” cord-cutting, and streaming services, major players in the content distribution business are showing concern that the slow summer might be a sign of things to come.
“By the time Labor Day weekend wraps, summer box-office revenue in North America will end up being down nearly 16 percent over last year, the steepest decline in modern times and eclipsing the 14.6 percent dip in 2014,” said The Hollywood Reporter writer Pamela McClintock. “It will also be the first time since 2006 that summer didn’t clear $4 billion.”
The top 12 films took in an abysmal $49.6 million at the weekend box office, the worst result since the 9/11 attacks https://t.co/JHJssdleXq
— NYT Business (@nytimesbusiness) August 28, 2017
Los Angeles Times reporter Ryan Faugnder reaffirmed McClintock’s conclusion. Faugnder’s reporting reveals that “Studio executives, movie theater operators and analysts cited the usual explanations for the summer slump…Too many bad movies (including sequels, reboots and aging franchises that no one wanted to see)… rising ticket prices… long-term challenges, including competition from streaming services such as Netflix and the influence of the movie review site Rotten Tomatoes.”
For years, cinephiles have criticized Hollywood for producing sequels, reboots, and adaptations instead of new original content. Many of the underperforming films this summer fall into this category. Movies like “Transformers: The Last Knight ($132 million), The Mummy ($80.1 million) and Pirates of the Caribbean: Dead Men Tell No Tales ($172 million)” failed to draw in audiences like the movies that came before them, according to The Hollywood Reporter.
Movie producers do not seem to be changing their mind on franchise movies anytime soon however. Entertainment website Den of Geek recently listed upcoming movies in development over the next couple of years in an article entitled “124 Movie Remakes and Reboots Currently in the Works.”
As an alternative, companies are now attempting stir interest in theatergoers by bringing in different business models — including a subscription-based model — into the traditional theater-going experience.
In August, movie subscription service MoviePass, which offers subscribers tickets to movies in theaters, announced it would be slashing its prices (which could reach up to $50 a month) to $9.95 a month.
The announcement was met quickly with support from both Wall Street and consumers; stocks in the company’s majority owners increased 5.7% by the close of markets and MoviePass’s website crashed for days.
While the company has been around since 2011, the company’s new lower price introduced many moviegoers to its business model for the first time. The New York Times reported last week that “more than 150,000 new users sign[ed] up in just two days after the company’s announcement.”
Not all parties were so eager. AMC Theaters, the largest theater chain in the United States, saw its stock price fall by 2.6% following the price cut, as investors measured the impact services like MoviePass could have on theaters’ bottom line. In a public statement, AMC announced they would be exploring legal options to deter MoviePass from being used in their theaters.
AMC was among those hardest hit by the summer slump, with shares in the company having dropped by “a dramatic 45 percent since Memorial Day.”
Theaters are also struggling to balance the drain in audience caused by video on demand services that can be watched from home. Content producers and distributors like Netflix, Hulu, and Amazon are no longer rookies in Hollywood, spending hundreds of millions of dollars each year on original content. One of the largest players in Hollywood, Disney, has also recently announced they will be ending their contract with Netflix to start their own streaming service.
Though one ‘down’ summer for Hollywood may not mean certain death, it certainly indicates to a troubling trend. As the Washington Post put it, “To some in the industry, the crushing results of the past several months are little more than a blip, one attributable more to bad luck and poor timing than a full-on industrial crisis.”
Who knows? Ten years from now Avatar 7 may be premiering on television screens across America, as movie theaters become obsolete.