Hollywood's blah year

Despite the box office record set by Pirates of the Caribbean: Dead Man's Chest (which I just saw on DVD--great effects, but the movie makes no sense), Hollywood didn't have a blockbuster 2006. In terms of tickets sold, it was up just 1% from the dismal 2005 (corrected for population expansion, that's no growth at all), and still dramatically down from 2002-2004, which were the last good years before the DVD/home theater boom fragmented the audience even more than VHS had before.

Here's the chart:

Stats from BoxOfficeMojo (sub req'd for detailed numbers)

In revenue terms, the picture looks a bit better, thanks to increased ticket prices--2006 was up 4% from the bleak 2005, although still down from 2003-04.

The Hollywood Reporter has a good year-end wrapup (note that its numbers are slightly different from BoxOfficeMojo's, although it doesn't give a source for them). Excerpts:

By some standards, 2006's crop of hits were not quite as robust as the biggest movies of 2005 -- or years before that. Only one film passed $300 million this year and last, while three films reached more than $300 million in 2004 and two each were in that category in 2003 and 2002.

This year, "Dead Man's Chest" might have gone on to pass the $400 million mark -- a mark that wasn't reached in 2005 -- but only five other films grossed more than $200 million domestically during the year, two fewer than last year.

There were more wide releases (movies bowing in more than 1,000 theaters) this year than last -- 160 vs. 145. But fewer movies received ultrawide bows of 3,000 theaters or more, as those releases were scaled back from 55 in 2005 to 52 this year.

Possibly as a result, the average opening-weekend gross for a new film slipped to $16.9 million from $17.6 million in 2005. On average, movies debuted in slightly fewer theaters -- 2,543 this year vs. 2,591 last year -- but scored a slightly lower per-theater average. This year it was $6,663, compared with $6,782 last year. As for average second-weekend drops, they were slightly steeper this year -- 45 percent vs. last year's 43 percent.

Comments

[Chris Thilk]

Speaking of movie performance, I didn't know if you had seen this, about a movie that played on one screen for 6 days and grossed about $30: http://www.cinematical.com/2007/01/02/the-very-worst-box-office-returns-of-2006-belong-to/

[Oliver Dueck]

Box office numbers may be down, but the story lacks relevance unless you also look at DVD sales. Are they up or down? If up, do the increased sales make up for the box office losses?

During the past decade, we've seen radical shifts in content delivery and we will continue to see these radical changes. Consumers aren't spending any less on entertainment - they are just spending differently than they used to.

[Ian Betteridge]

Oliver is completely right. Big movies are cross-media properties that gain vast amounts of revenue away from the box office - from DVD sales and rentals through to toy sales and other spin-offs. Add in those figures for big movies over the past ten years, and you'll get a far better idea of what the size of the "head" is compared to your tail.

[Ian Betteridge]

I just did a bit of searching to dig out some figures, and according to Edward Epstein's feature in Slate last year, only 15% of studio revenues now come from box office, compared to 55% in 1980. 59% of movie studio feature film revenues now comes from DVD. And the DVD sales business is booming: "In the first three months of 2005, the studios earned $5.67 billion dollars from DVD sales, compared to $4.375 billion in the same period in 2004. DVD sales were up $1.29 billion, an incredible rise of 28 percent, which exceeded last year's increase."

Blockbusters dead? Nope. What's happening is that studios are using box office takings to effectively cover the costs of making the movie, and making vast profits on DVD releases. Chris, you need to dig deeper to get a real picture.