Attendance Down but Industry Isn’t

An assertion that “Hollywood is plenty nervous” about a recent down-swing in movie attendance kicks off David J. Fox’s article “Honey, They Shrunk the Movie Audience” (Calendar, June 8). But Fox may have overstated the level of the film industry’s anxiety.

It is true that the past three years have been less than robust for the film industry, including motion picture exhibitors. Attendance has declined moderately and only price increases have led to an overall minor revenue increase. But what Fox fails to point out is that this dip represents a cyclical swing and not--as the article seems to suggest--a structural downturn signaling the demise of the movie theater!

Fox notes, quite correctly, that the number of young people between the ages of 13 and 25 (historically the nation’s most frequent moviegoers) has been shrinking. That number has, in fact, been shrinking steadily since the mid-1970s. What his article does not mention, however, is that--according to the U.S. Census Bureau--the number of 13- to 25-year-old Americans has just begun to grow again, and will continue to grow steadily well into the next century.

This is not the kind of news to evoke plentiful nervousness within the corridors of Tinseltown. In fact, one might even argue that the recent precedent-shattering success of Universal Pictures’ “Jurassic Park” is just the tip of the box-office iceberg.

The same article points out that a million fewer tickets were sold during 1993’s Memorial Day weekend than during 1992’s Memorial Day weekend. But the 1992 holiday was led by “Lethal Weapon 3” and “Alien 3, “ sequels to blockbuster action movies. Memorial Day, 1993, was led by the non-sequels “Cliffhanger” and “Made in America.” Event sequels almost always enjoy better launches than non-sequels. In fact, “Cliffhanger” enjoyed the best non-sequel Memorial Day launch in history.

Fox’s article notes that fewer tickets were sold in 1992 than during any year since 1976. True. But while this seems to suggest that the movie industry is in decline, the movie industry is in fact stable. For decades, North American movie attendance has been close to 1 billion annually. A cyclical variation of a few percentage points from that level is what creates the difference between a bad year, an ordinary year and a blockbuster year. Economic fluctuations have an effect, but recession or not, people will come to see entertaining movies.

Finally, the article suggests that the key under-25 consumers may be forsaking movies for video rentals and video games. But this concept ignores the basic human need for social interaction. It assumes that the availability of technology totally controls how people behave. We all have kitchens with gadgets our parents could not have imagined, and yet we still go out to restaurants for a different kind of experience.

The various forms of in-home entertainment, like home video and video games, are fighting for audiences among themselves, not against out-of-home activities like moviegoing. Moviegoing competes with other forms of out-of-home activities. Video offers one form of entertainment. Movie theaters another.

I think most industry professionals agree with Sony Pictures Entertainment Chairman Peter Guber who recently said, “We can expand our business to the farthest points of the Earth, repeat movies in a dozen new formats and technologies, blaze new pathways into home entertainment, but there is no substitute for the shared emotion of going to the movies--the 20th-Century version of the tribal campfire.”

Is Hollywood really nervous? Well, I think that most Hollywood types would not describe themselves as pillars of composure. But are they more nervous, on average, than usual these days? I would suggest quite the opposite.