Attendance at Theaters Slumps 9%

Moviegoing in 2005 fell to its lowest level in nearly a decade while the costs to market films continued to increase, especially for smaller, specialized ones, the Motion Picture Assn. of America said Thursday.

The MPAA’s annual box-office marketing report confirmed the sluggish box-office trend that caused Hollywood so much anxiety last year.

U.S. theatrical admissions dropped nearly 9% to 1.4 billion, the lowest figure since 1997. Abroad, there was a 9% decrease in box-office sales, the MPAA said.

The international decline could be due, in part, to fluctuations in the currency markets. However, the drop is of concern to the studios because foreign ticket sales are such an important revenue source.

One of the biggest changes last year was a whopping 33% increase in costs to market specialty films, reflecting their growing popularity among moviegoers and how competitive that segment of the business has become.

According to the MPAA numbers, the average price tag to market a specialized film jumped to $15.2 million from $11.4 million in 2004. However, the average production cost fell 19% to $23.5 million, the report shows.

Studios release specialty films through such divisions as 20th Century Fox’s Fox Searchlight, Universal Pictures’ Focus Features and Warner Bros.’ Warner Independent Pictures. Last year’s high-profile specialty releases included “Brokeback Mountain,” “March of the Penguins,” “Capote” and “Good Night, and Good Luck.”

Among the major studios, the average price to make a movie overall fell slightly to $60 million last year from $62.4 million in 2004. But the average marketing cost rose 5.2% to $36.2 million from $34.4 million.

The MPAA sought to counter speculation that moviegoers increasingly prefer watching films at home versus going to the theater. The MPAA cited a study conducted in August by Nielsen Entertainment/NRG on behalf of the studios, which found that moviegoers who use video-on-demand or own a DVD player, large television or a digital video recording device watch more movies annually than other consumers.

The majority of those surveyed, 69%, agreed that theaters offered the “ultimate movie-watching” experience, compared with 31% who prefer watching movies at home, the survey said.

“Despite increasing competition for consumers’ time and entertainment dollars, theater going remains a ... constant in people’s lives,” MPAA Chief Executive Dan Glickman said in a statement. “That said, we can’t bury our heads in the sand. We have to do more to attract customers and keep regulars coming back.”