Recession good for movie theatres? Where I live it costs $8 to see a movie and tag on $1.50 per ticket if you want to order using Moviephone. Add in another $15 for over priced fountain drinks and the most fattening and unhealthy popcorn in the world (this figure may include Goobers or M & M's). For a family of four, the cost is above $40 clams. In a recession, I don't think too many families are going to make the theater a weekly event.
It is more likely that they will stay home and rent a video or use their VOD options. $4 clams for the movie, $1.59 for the popcorn, $1.99 for 2 liter Coke and plenty of sweets. At less than $15 bucks, staying home is the best option, unless it is a real good movie or something that lends itself well to the big screen (Saving Private Ryan or Jurrasic Park). In fact, a recession and the resulting slow down in ticket sales could prompt the movie studios to be more agressive on the time between big screeen release and video or pay per view.
When I look through the movie pages in the paper, I usually make the decision of either making a movie a priority that I would like to see, concluding that I would like to see it, but can wait until it makes it to video or pay per view, or simply that I have no interest (unless their is nothing left on the local video store shelf and I am desperate).
VOD has the potential to change the dynamics of the movie distribution business and how revenue is generated. Blockbuster and Hollywood Video will wage an agressive battle to combat their entrenched positions and they remain a valuable source of revenue to the studios. At the end of the day, it is the consumer that will choose the option they want and the studios will go that way no matter how good a deal Blockbuster cuts them. Mom and Pop shops will go out of business and Blockbuster and Hollywood will get a bigger piece of a shrinking pie, also known as a slow bleed. VOD may also put pressure on how the cable companies package their premium channels. As VOD takes hold, the price of pay channels will likely drop or be combined into larger premium packages bundled with other services such as telephone, e-mail or home shopping (these set top boxes have a slot for a smart card).
Austin will be on line by late next week or the following week. Mostly employee homes. They will be testing performance and then test to see if there is any degradation of picture quality or delivery bottlenecks as they scale up adding home by home in different areas of the city. 2 other cities should be in this process within the next 2 months. In essence, this will be the test bed on how fast and what testing procedures need to happen in each market as they start to layer on services such as VOD. |
