Are movie theaters becoming irrelevant?

The evolving entertainment business


Maxwell Zaleski/Collegian

By Audrey Bushyeager, Collegian Correspondent

Going to the movies has long been ideal for a classic night out for the whole family or for a first date. Starting in the 1890s with the first well-known film, the movie business has since evolved into a major industry. That first film, created by the Lumiere Brothers in France, consisted of a train pulling into a station, a man gardening and men playing cards – the film was so simple, yet it was a huge success. Nowadays, many people wouldn’t be able to sit patiently and watch eight minutes of a train. Media technologies have changed significantly since 1890, creating shorter attention spans and altering the business conditions of the movie theater industry.

Movie theater companies were able to make profit from film screenings and overpriced snacks until the development of smart phones and streaming services. People are used to instant gratification and entertainment 24/7 from their various portable technologies, which has caused attention spans to decrease. This is one of the largest obstacles facing the movie theater industry. With entertainment at our fingertips, many are less motivated to leave their homes to see a movie.

These factors have caused a decline in audiences and consequently a continuous rise in the prices of movie tickets in order to compensate for their losses. The average movie ticket price across the United States has gone from $4.35 in 1995 to $9.03 in 2019. In New York, I usually find myself dolling out $14 to $20 for a standard movie ticket.

Another factor that could hurt movie theaters in the coming years is MoviePass. The subscription service MoviePass allows a subscriber to watch three movies a month for about $10. MoviePass creators recognized the problem of expensive movie tickets and created an app, perfect for a consistent movie-goer. On March 20, MoviePass brought its $10 unlimited movie plan back for a limited time. While this is bringing audiences back into movie theaters, it has also caused some financial problems for AMC Theaters, which is strongly against the unlimited plan. AMC has a similar concept, Stubs A-List, which allows star status AMC members to make free reservations and see three films per week.

Theater chains make most of their revenue from advertisements, just like most media businesses. In order to continue making money off advertisement spaces, the theaters need to ensure good audience turnout. AMC, a leader in the industry, introduced new services to increase turnout, including dine-in theaters in 2008, MacGuffins Bar in 2012 and heated recliner chairs. These developments required a lot of funding, which was only possible when the Beijing-based Wanda Group acquired AMC, escalating its luxury amenities. The Wanda Group has invested millions of dollars over the past couple of decades, testing out new experiences in their franchises. Shortly after this development, AMC went public on the New York Stock Exchange, allowing investors to buy stock in the company.

AMC’s additional services take the movie theater business to a different level of entertainment. It is doing everything in its power to make the movie theater a worthwhile spot for the masses. These developments make AMC even more of a commodity for companies seeking advertising as well as production companies seeking attention for their new releases. MacGuffins Bar constantly comes out with new movie-themed alcoholic drinks. On AMC’s Facebook page they have a promotion for Ant Man that reads “Team up with the dynamic drink duo. ‘The Pomegran-ant’ and ‘The Stinger’ cocktails are now pouring at our MacGuffins Bar & Lounge!”

But are people willing to pay for an expensive movie ticket like they are willing to pay for a night out? Will efforts made by AMC and other companies pay off? Only time will tell if these efforts are enough to prevent movie theaters from going extinct for good.

Audrey Bushyeager is a Collegian correspondent and can be reached at [email protected].