Just What Can Movie Theaters Charge? And how that’s good for indies.

6 08 2010

A recent article on THE WRAP discusses the very obvious downturn in box office for 3D films. This (they say) doesn’t prove that 3D is a fad but that “not every movie should be in 3D.”

While it’s easy to make broad generalizations based on very little evidence (hell, that’s what I do here, right?), it’s actually much more nuanced than that.

We’ll see what happens to STEP UP 3D this weekend, but we are clearly in the early stages of 3D adoption. I’m inherently skeptical that 3D is ever going to take over the film, tv and web content world, but I’m also waiting to see what will happen to movie 3D if television 3D becomes more popular. Once we become used to 3D on TV, will that make it a requirement in theaters, or will it simply cheapen the concept?

But it was a different sentence entirely that woke me up from this ongoing, every-present, 3D/2D discussion.

Speaking of Dreamworks Animation CEO Jeffrey Katzenberg, the article says:

He also thinks exhibitors will have to move away from its age-old, one-size-fits-all pricing model.

“For the first time in a long time, I think you’re going to see some adjustment on that,” he added.

One of the things that may be damaging 3D admissions right now is the three to five dollar admission price premium that theaters are tacking onto their normal ticket prices. While that’s fine for a cool event film, it’s probably going to mean the difference between a Yea or a Nay for a family of five deciding whether to see a film on a weekend. Think about it — with three kids, you’re already laying out over 50 bucks for tickets and another 30 or 40 for food. That’s about $100 before you even think about 3D. Add another 15 to 20 bucks for that incredible stereoscopic experience in CATS AND DOGS and you’ll probably get as many people saying “Nah, I heard that the film wasn’t so good” as say “It’s worth it just to shut the kids up for two hours.”

But Katzenberg’s point is well-taken. We expect that first class air flight is going to cost more than economy. We know that putting premium gas in our tanks will cost us more than regular. Don’t we? Why should we expect that every seat, in every theater in a multiplex, for every movie, will cost the same amount. It’s long been accepted that people going to see the less popular matinee performances of a film will pay less.  Isn’t that just another way of saying that people going to evening films will pay more? If that’s the case, why shouldn’t people who decide not to put on the 3D glasses pay less than those who do?

The key here would be to create a sliding scale for films that better reflects the demand for that experience. Would you pay 15 bucks to see the next HARRY POTTER film?  Perhaps, if you can guarantee me that I won’t have to pay anything more than 9 or 10 bucks to see the latest Nicole Holofcener film. I’m not saying this because PLEASE GIVE isn’t as good a film as the 58th film about Hogwarts School of Magic, but because fewer people want to see it. Think about it — this could be great for small indie films. Incentivise people to see indie films in a theater. Make it cheap to see them on a Wednesday night in a smaller theater without 3D. Make it a great alternative on Saturday night to the 3D/super Dolby-ized, VFX-heavy/big theater Potter and Snape. Then give me the opportunity to upgrade my indie ticket with comfier seats, reserved seats and better placement in the theater.  I’m there for you baby!

I’m not talking about ghetto-izing these films. The success of the Laemmle or Arclight style experience (with comfortable seats, good food and advanced seat reservations) proves that people will pay for value. But your definition of value is almost certainly different than mine. And the next person’s. If lower ticket prices are more important to you than comfy seats, then you should be given the opportunity to act on that. But once you leave behind the idea of one ticket price for every seat in a theater, then you’ve really freed yourself up for some great opportunities to bring people into the theaters, as opposed to driving them away.

The tricky thing here will be to avoid having theater owners gouge their patrons, and to avoid having film distributors gouging theater owners. One valuable service that the defunct, though not lamented, Hollywood Stock Exchange gave was a number which roughly correlated with people’s desire to see a film. AOL’s Moviefone provides similar data. This doesn’t mean that those numbers are always right, but they do lead the way to a pricing model that studios would have to take into account in order for theaters to price their tickets on a sliding scale.

In a world where theaters are competing with the Net for viewers, taking a cue from the web and letting viewers pay for content that they want might not be such a bad idea.


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4 responses to “Just What Can Movie Theaters Charge? And how that’s good for indies.”

6 08 2010
Sex Mahoney (22:56:45) :

This is a fantastic idea, but I can’t imagine anyone in the theater or distribution industries jumping on it.

Start your own theater, that’s how good this idea is… for independent films.

The best cure for the movie theater’s woes is to for Hollywood to make better movies and for theater owners to provide better service.

Since neither of those things is likely to happen soon (ever), mainstream film will continue it’s steady decline into bland mediocrity.

People know they’re getting ripped off at the movies. They know that “Harry Potter and the Too Late to Ask For a Refund” isn’t worth ten or fifteen dollars, no matter the “D” in which it’s exhibited.

On the plus side, by continuing to throw money at a dying industry (movie theater exhibition) we’re almost guaranteed to see studios and theaters spend even more time trying to squeeze ever penny out of their customer base before people really get fed up and stop going to even the blockbusters.

The real answer is to start serving booze at the theater.

People don’t care about lousy customer service or lazy storytelling if they’re obliterated. That’s a triple win.

Let’s just hope that theater owners don’t charge thirty dollars a beer.

12 08 2010
Chris Higgins (08:37:41) :

This is actually exactly how it works in India.

Every cinema has reserved seating – i.e. your ticket has a seat number on it. Which is fantastic as you can buy your tickets early and then turn up at the last minute and not have to search for seats.

Within the cinema, there are then different price grades – cheap seats at the front, normally priced in the middle, and more expensive at the back. If they really want to charge a premium, the back seats might be big armchairs that recline, or the back section might have a separate entry that is more luxurious, or with better food.

Ticket prices also vary from weekday to weekend, and big films are sometimes more expensive – often because the distributor has negotiated a smaller cut for the cinema owner, so they make up the different with higher prices.

12 08 2010
Norman (16:59:40) :

Thanks for the information. It’s hard to believe that this couldn’t work here in the US. Does it require much of an infrastructure at the theater’s end?

12 08 2010
Norman (17:01:47) :

Well, yes. Better movies should work better.

I love the fact that the decline of 3D tickets is being blamed on 3D overload. How about the fact that crappy movies in 3D don’t sell any better than they would if they were in 2D. Sure, the fact that there are a limited number of 3D screens might enter into it, but not as much as a “must see.” Does anyone believe that INCEPTION would have sold more tickets if it had been in 3D?

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