If You Screen It--and It’s Good--They’ll Pay to See It

During the most competitive moviegoing seasons of the year, the question invariably arises: Just how expandable is the marketplace?

The answer may be as simple as the refrain in the popular Kevin Costner baseball movie “Field of Dreams”: If you build it, they will come.

This summer’s “boffo” box office--to use Daily Variety’s favorite vernacular--proves just how elastic the business can be when Hollywood delivers the kind of movies audiences want to see.

That distinguishes the movie business from most other industries in that it offers up a series of unique commodities in a truly elastic marketplace.

“Unlike all other products like Crest toothpaste or Ford automobiles that essentially stay the same each year, every time you make a movie, you start a brand-new business,” says Jack Valenti, president of the Motion Picture Assn. of America. “And, instead of changing a model once a year as Ford might, there are hundreds of new movies being made every year.”

In fact, last year, Hollywood released more than 500 of them.

The hundreds of millions of dollars so far being generated at this summer’s box office, led by such strong performers as “Austin Powers: The Spy Who Shagged Me,” “Tarzan,” “Star Wars: Episode I The Phantom Menace” and “Notting Hill,” underscore how the market can support a number of hits at any one time--provided they satisfy audiences.

Despite some negative reviews, even “The General’s Daughter” with John Travolta had a strong opening last weekend, collecting more than $22 million.

With big films opening every weekend, people are still plunking down their dollars to see holdovers such as “Phantom Menace,” which grossed about $19 million last weekend, and “The Mummy,” which sold more than $3 million worth of tickets last weekend after being in release for nearly two months.

“Austin Powers,” “Tarzan” and “Phantom Menace” are expected to continue being embraced by audiences even with new entries such as this weekend’s Adam Sandler comedy “Big Daddy” and “Wild Wild West,” starring Will Smith, storming into theaters at the end of the month.

Experts say the expansion in the market is not so much attributable to more people suddenly going out to the movies, but rather to the frequency with which regular moviegoers are venturing to the multiplexes to see a variety of choices.

“That hard-core group is going back multiple times,” says Larry Gerbrandt, a senior entertainment analyst at Paul Kagan Associates. “Instead of maybe seeing three movies a month, hard-core moviegoers are seeing four.”

Based on the fact that a wide range of summer films are doing strong business--from comedies such as “Austin Powers” to family adventures such as “Tarzan” and romantic comedies such as “Notting Hill”--diversity of product seems to be a key enticement.

“There’s no question that this summer, we’ve had movies with broader demographic appeal,” says Gerbrandt.

Then, of course, there’s the repeatability factor. Teens are going back to see films such as “Austin Powers” and the “Star Wars” prequel time and time again.

Moviegoing is contagious, and, this summer, audiences seem to have caught the fever.

“There’s a social pressure that if you haven’t kept up and gone to certain movies, you look like an idiot,” says Larry Kimbell, a UCLA business economics professor.

Sometimes referred to as “the water cooler” phenomenon, people in the workplace on Monday morning want to be able to join in a conversation about having seen the most talked about film over the weekend.

“We need something to talk about,” adds Kimbell. “For a while it was the O.J. trial, but for years the movies have provided us with a common thing to talk about.”

And the summer of ‘99--which is shaping up to be the best news the movie industry has had in recent memory--is giving everyone in Hollywood something to crow about.

The buoyancy of the movie business comes at a time when Hollywood executives are struggling with escalating production and marketing costs and diminishing returns, triggering industrywide cost-cutting.

“On a title-by-title basis, it’s a bad business,” says Gerbrandt. “But, in the aggregate, it’s a great business that continues to grow and has no inherent limitations,” despite problems such as the current turndown in international home video sales.

Valenti observes that in spite of “lacerating competition” from cable television (in 70% of the homes), satellite, home video and the Internet all vying for consumer attention, “box office and attendance have been going up steadily over the last five years.”

According to MPAA statistics, box office receipts last year totaled a record $6.9 billion and admissions numbered 1.68 billion, compared with $6.3 billion and 1.38 billion in 1997.

“There’s a quicksilver nature to this business,” says Gerbrandt, “and every few summers it all comes together.”