It’s a classic Catch-22.
Movie theaters must show blockbusters to lure audiences, but Hollywood studios need large crowds to justify releasing $200 million movies.
While two-thirds of the nation’s cinemas have reopened, box-office receipts say the public is not ready to return to the movies, The Wall Street Journal reported.
The Observer reported U.S. box office revenues are expected to drop to $6.5 billion this year, down from $11.4 billion in 2019, the lowest in 25 years.
“You can’t blame a studio or director for holding back the release of a film,” Paul Glantz, co-founder of Midwest movie theater chain Emagine Entertainment Inc., told the WSJ. “You’ve got to have enough theaters open throughout the United States and the rest of the world to ensure you get the proper audience exposure.”
Warner Brothers gradually released “Tenet,” the $200 million action thriller film, to movie theaters last month and it made $29.5 million after two weeks in the U.S. That was followed by $177.5 million overseas, the newspaper reported.
But that’s not enough to nudge any movie company to release movies that cost nine-figure sums to make.
“You can’t do it,” a major studio executive told the WSJ. “The economics won’t allow you to do it. We can’t give [theaters] a $200 million movie if people aren’t going to come.”
The future of the global theater market is no guarantee as some European nations confront a potential second wave of COVID-19 infections. That raises the stakes on a single movie “Wonder Woman 1984” producer Charles Roven told the newspaper.
“Just when you think things are calming down in a particular market, it can flare up again,” he said.
In July, PYMNTS reported AMC Entertainment Holdings reached an agreement with Universal Studios to allow the company to release films to video-streaming services after just 17 days of play in cinemas.
The deal signals the reversal of a longstanding policy that required studios to play films on the big screen for at least three months before making titles available in the home.
PYMNTS’ research documenting the impacts of the pandemic since March identified four distinct consumer personas that had shifted to digital due to COVID-19, with one being the “safety shifter.” These consumers are the most worried about suffering negative impacts of the pandemic, with nearly 76 percent reporting they are “very” or “extremely” concerned, according to The Great Reopening: Shifting Preferences edition of the PYMNTS report series on COVID-19.