It’s safe to say that 2017 will go down as one of the amazing years in hollywood’s history. The past year has seen a widening sexual harassment scandal, potential decline of major studios, historically low summer box office results, and Wall Street’s diminishing confidence in the future of theatrical distribution.
Amidst the recent wildfires and a sense of uncertainty, the entertainment industry in Los Angeles is experiencing a fear that the old order is collapsing, making way for something new and unsettling.
“It’s not a sea change, it’s a tsunami,” said Jeff Bock, an analyst with Exhibitor Relations. “The tide has moved against movies. They used to be the hub of what entertainment is, but that core has shifted to streaming and television. Back in the day people talked about ‘Back to the Future’ or ‘E.T.’ when they talked about entertainment. Today, it’s ‘Stranger Things’ or ‘Game of Thrones.’”
domestic theatrical revenues. do you know?
They may be eager to say goodbye to 2017, but studio and exhibition executives are comforting themselves with the knowledge that the year could have ended up a lot worse. Domestic theatrical revenues will be down roughly 2%, ending the year between $11.1 billion and $11.2 billion, while attendance will be off between 4% and 5%. On the brighter side, the worldwide box office will likely hit new heights and even has an outside chance of reaching $40 billion for the first time. China, which had slowed its explosive growth, sprung back to life. As of the middle of November, theatrical box office in the middle Kingdom exceeded RMB50 billion. Last year, box office revenues for the entire year in China topped out at RMB45.6 billion.
While
the stateside numbers won’t make history, it’s impressive that box office returns were able to rebound in the final four months of 2017, considering the summer’s nearly 15% year-over-year decline in sales. This came after a series of major flops like “Baywatch” and “Valerian and the City of a Thousand Planets.”
“If you look back to summer, there was so much sturm und drang abut the demise of the movie industry, ” said Chris Aronson, Fox’s domestic distribution chief. “It was so unfounded. There are peaks and valleys with any industry, and the bottom line is the summer was filled with disappointing movies. The fact that we’re going to get close to equaling last year’s record year shows things are not so dire.”
Investors certainly got turned off by the meager returns, triggering a mass selloff. AMC’s stock has fallen nearly 70% over the past year, while other publicly traded exhibitors such as Regal and Cinemark also saw their share prices nosedive over the summer.
Things
do seem to be on the rebound. Beginning in September, when “It” and its child-munching clown Pennywise terrified audiences to the tune of $327.5 million stateside, theaters began to claw back into contention. There was more variety, which helped; a healthy mixture of indie favorites such as “Lady Bird” and “Three Billboards Outside of Ebbing, Missouri,” as well as more mainstream crowd-pleasers such as “Star Wars: The Last Jedi” and “Coco.” Then there were the breakouts that few saw coming — “Wonder,” for example, a tender drama about a young boy with a facial deformity, grossed over $156 million worldwide on a $20 million budget by serving as an antidote to blockbuster gargantuanism.
“Audiences continue to tell us they want to see something new and fresh,” said Jim Orr, Universal’s head of domestic distribution. “It can’t just be caped crusaders from top to bottom.”
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In October, an offscreen drama unfolded when dozens of women came forward to accuse indie mogul Harvey Weinstein of sexual harassment and assault, overshadowing the hits and misses in the industry. That scandal metastasized as more misdeeds and misbehavior came to light, ensnaring the likes of Dustin Hoffman, Kevin Spacey, Brett Ratner, and John Lasseter, and casting a pall over the business. This great reckoning has shown a darker side to power and celebrity, and the moral rot threatens to turn off rising generations of actors, writers, and directors, who may look beyond Hollywood for other outlets for their creativity.
There were certainly takeaways from what films connected with audiences and which ones suffered the cold shoulder. Comedies, with the exception of the raucous “Girls Trip” and the heartfelt “The Big Sick,” failed to ignite. “CHiPs,” “The House,” and “Baywatch” all flopped, as R-rated hijinks and gross-out gags grew tired. In contrast, horror films had a huge and wildly profitable year. “Split,” “Get Out,” “Annabelle: Creation,” and, of course, “It,” all scored, and, as an added bonus, cost far less than the typical major studio release. “Get Out,” for instance, smartly combined racial politics with scares, and grossed an astounding $175.5 million on a $4.5 million budget. A James Bond film would kill for those margins.
jeff goldstein
Jeff Goldstein, domestic distribution president at Warner Bros., stated, “There’s something about the shared experience of being in a theater, watching a horror movie, that can’t be replicated at home. People jump, make noise, and get shocked and scared together.”. It’s so unique.”
Despite horror’s continued success at the box office, major franchises are showing signs of decline. “Transformers: The Last Knight” and “Alien: Covenant” underperformed compared to their predecessors, casting doubts on their future. Additionally, “Justice League” received negative reviews and faces financial challenges as DC Comics’ attempt to rival the Avengers on screen. In its aftermath, the comics maker is reevaluating its movie making approach and overhauling its executive team.
Patrick Corcoran, spokesperson for the National Association of Theatre Owners, stated that audiences have discerning judgment. He mentioned that when a movie has a number in its title, like “five,” concerns arise about how much story is left to tell.
But launching new franchises to replace the old and doddering ones can be hazardous. The year is likely to end without the launch of a new significant film series, as most attempts to create fresh cinematic universes faced disappointments and setbacks.
Audiences
, however, had other plans, largely steering clear of the film, which grossed more than $400 million globally, but carried an $150 million price tag, as well as more than $100 million in promotional and distribution costs, making it a disappointment. That’s sent the studio back to the drawing board on its Bride of Frankenstein reboot. In the same vein, “King Arthur: Legend of the Sword,” “Valerian,” and “The Dark Tower” all were greenlit with visions of sequels and follow-ups, only to crash on the shoals of audience indifference.
Returning franchises can’t just lean on familiar characters or well-worn story lines, argues Adrian Smith, Sony’s president of domestic distribution. He points to “Spider-Man: Homecoming,” the third reboot in the wall crawler series, which found a new spin on a familiar tale by sending its hero back to high school and focusing as much on the drama around finding a date to prom as it did on world saving. The same was true of “Thor: Ragnarok,” which found the god of thunder shedding his signature long blond tresses in favor of a crewcut, and emphasized humor over heroic clashes.
The World War II (Inside Hollywood’s amazing Year.)
epic “Dunkirk” stood out as a summer hit by embracing the cinematic experience. Shot with IMAX cameras, its scope and drama demanded a wide screen viewing, highlighting the significance of movie theaters.
Netflix faces challenges in creating big-budget entertainment that matches major studios. Netflix faced harsh criticism and widespread perception of “Bright,” their largest film investment to date, as one of the worst films in 2017. Reviews and social media response serve as the measures of Netflix’s film success since they do not disclose viewership data.
“I just think this is the tip of the iceberg,” Greenfield said. “You’ve got to start somewhere. But this is the beginning of a very aggressive long-term strategy.”
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as the matter of fact that. (Inside Hollywood’s amazing Year.)
Netflix isn’t the only company who sees opportunity in the tumult. Byron Allen, best known as a producer and stand-up comic, has refashioned himself into a movie mogul. So far, the strategy is working. “47 Meters Down,” a low-cost movie about two women fighting off sharks, was the company’s first release. It went on to gross $53.2 million worldwide, against a production budget of $5.5 million.
“This is a great time to be in the business,” said Allen. “The big studios are getting bigger. They’re consolidating and pursuing much bigger box office per film.
Going forward, Allen says Entertainment Studios plans to release between 15 to 20 films a year. That could help fill a void. The year closed with Disney announcing plans to acquire the bulk of 21st Century Fox’s film and television holdings. This year, Disney released fewer than 10 films and Fox fielded more than 20 pictures. The merger of Fox and Disney is unlikely to result in over 30 films, reducing annual releases. It also reduces major studios from six to five, limiting opportunities for scripts and directors. While it creates a powerful moviemaking force, some rivals see potential benefits.
As for the (Inside Hollywood’s amazing Year.)
moviegoing experience, despite the introduction of plush seats and better sound, it remains largely unaltered. Audiences pay $10 to $20 for a movie ticket, endure commercials and trailers, and spend on expensive concessions. More important, it’s a hit with a key demographic. At a time when younger moviegoers have been on the decline, 75 percent of MoviePass subscribers are millennials.
“Young people have been abandoning theaters, but they make up our first wave of customers,” said Mitch Lowe, MoviePass’ CEO. “They grew up with subscription services like Netflix and cable and Hulu. This gives them an alternative.”
There are problems with this business model. MoviePass pays the full price for each ticket its customers buy, resulting in losses per transaction. It subsidizes subscribers’ movie-going, hoping to make the collected customer data valuable for discounts or monetization. Uncertain if this will succeed, especially since AMC, the biggest exhibitor, has threatened legal action. If MoviePass doesn’t find a way to turn a profit, it could find itself in dire financial straits.
MoviePass (Inside Hollywood’s amazing Year.)
’ success at signing up customers does point to the fact that this is an industry ripe for innovation. Box office analyst Paul Degarabedian suggests that theaters should consider organizing televised Q&A sessions with talent after screenings. That’s something that Netflix can’t offer, he reasons.
“Let’s get creative people and think outside of the box,” he says. “We can’t become the next Tower Records.”
