Valenti Decries High Cost of Making Movies, Film Piracy

Characterizing the growing cost of making movies as a “huge, hairy beast slouching toward the future,” Jack Valenti, president and CEO of the Motion Picture Assn. of America, announced here Tuesday that the average cost of producing and marketing a studio movie in 1995 soared to $54.1 million.

Filmmaking costs have risen steadily, up from last year’s average cost of $50 million, Valenti told the annual convention of the National Assn. of Theater Owners at the opening of NATO/ShoWest ’96. The convention brings together film exhibitors, distributors, producers and marketing representatives from around the world.

“How high will it go?” Valenti asked a group of reporters before his speech. “Where will it end? It’s easy to point with alarm. It’s much harder to have a solution. I don’t have a solution.”

The number of movies submitted to the MPAA--an industry self-regulatory board that provides ratings to films--rose dramatically in 1995, as well, from 167 in 1994 to 212 in 1995, an increase of 26%, Valenti said, though the number of moviegoers remained relatively constant at 1.2 billion.

Those over 40 comprised one-third of all moviegoers, an increase of 43% over the last five years, Valenti said. But the largest group of filmgoers--nearly 42%--are those in the 21-39 age bracket.

Overall, movie-watching (which includes home-video viewing) has quintupled over the past 15 years, Valenti said, with more than 5 billion people watching movies in the United States.

But the conference transcends American borders and Valenti went on to decry the growing problem of international piracy of films, while lauding the globalization of the marketplace.

“Piracy is the biggest issue we have,” Valenti told reporters gathered for an informal breakfast. “An estimated $2 billion a year is lost around the world each year.”

He cited Russia, China and Saudi Arabia as some of the biggest offenders.

Much of the industry buzz centered on the boom in theater “megaplexes.” The forecasts were for a future characterized by an increasing number of 20- and 30-theater complexes, supplanting the older “multiplex.”

In light of that trend, the organization gave the ShoWester of the Year Award to Stanley H. Durwood, the chairman and CEO of AMC Cinemas and the inventor of the multiplex and the person responsible for the armrest cupholder. Durwood opened the nation’s biggest multiplex, a 24-theater complex in Dallas, and plans to open a 30-theater complex in Ontario, Calif., this fall. He will soon open multiplexes in Hong Kong (its first) and has opened Japan’s largest multiplex, 13 theaters, in Tokyo.