MPAA's '05 scorecard: B.O. slips, costs stabilize
MPAA: B.O. dips in '05
March 10, 2006
Putting an official number on the declines that depressed both the domestic and international boxoffice in 2005, the MPAA reported Thursday that the U.S. boxoffice dropped 6% to $8.99 billion last year, while the worldwide boxoffice wilted 7.9% from an all-time high of $25.23 billion in 2004 to $23.24 billion.
Within the U.S., the dip in admissions was even steeper -- from a recent high of 1.64 billion in 2002, admissions fell to 1.54 billion in 2004 and to 1.4 billion last year, a 8.7% skid between 2004 and 2005. At the same time, the average ticket price increased 3.2%, from $6.21 in 2004 to $6.41.
Preferring to view the situation as a glass half full, though, the MPAA said domestic boxoffice has remained just at or above the $9 billion level -- a benchmark it first topped in 2002 -- for four consecutive years.
The MPAA also reported that the costs of producing and marketing the average film released by member companies declined 0.6% last year. While marketing costs on the average film rose from $34.4 million to $36.2 million between 2004 and 2005, the average negative cost was shaved from $62.4 million in 2004 to $60 million in 2005. As a result, the combined average negative and marketing costs were down just a hair, from $96.8 million in 2004 to $96.2 million last year.
One caveat: negative costs, as reported by the MPAA, represent the amount each studio invests in a film but does not include investments from non-MPAA sources and therefore does not reflect the full costs of production for the average MPAA film.
Despite widespread media reports during the past year depicting moviegoers' dissatisfaction with their experience, the MPAA also released the results of a nationwide survey of moviegoers, defined as theater patrons who see one or more films a year, conducted in August by Nielsen Entertainment/NRG. Using a sample of 3,000 individuals, the survey found that 81% of moviegoers said that a trip to the theater was a good investment in time and money. Only 15% said they would have preferred to watch the movie on DVD, while 4% groused they wished they had not seen the movie at all.
Assessing the data, MPAA chairman and CEO Dan Glickman said: "Despite increasing competition for consumers' time and entertainment dollars, theatergoing remains a satisfying constant in people's lives. That said, we can't bury our heads in the sand. We do have to attract customers and keep regulars coming back. It is no secret that our industry faces new challenges, but with every challenge there is an exciting opportunity."
Glickman is expected to address how best to face the future when he speaks before exhibitors Tuesday at the ShoWest convention in Las Vegas.
According to the statistical picture of 2005 painted by the MPAA, while the number of movies in circulation increased, moviegoers tended to flock to a handful of top-grossers, which had the effect of boosting the average gross of studio releases.
Overall, 563 movies, including 14 reissues, were released last year in the U.S. The market had to absorb 37 more movies in 2005 than it saw in 2004.
The major studios, not including their specialty film labels and subsidiaries, rolled out 194 new features and four reissues.
The average boxoffice for studio releases rose from $34.6 million in 2004 to $37.3 million -- a 7% increase compared with the previous five years.
At the top of the heap, blockbuster films prospered last year. "Star Wars: Episode III -- Revenge of the Sith," the top-grossing film with $380.3 million, did not reach the heights of 2004's leader, "Shrek 2," which pulled in $441.2 million. But by the MPAA's reckoning, for the full calendar year, eight films grossed more than $200 million compared with five films in 2004.
Presented as a line graph, the average gross of the top 10 movies has held relatively steady for the past four years, racking up an average $203.8 million in 2002, $205.2 million in 2003, $205.3 million in 2004 and $203.2 million in 2005.
Of last year's top 20 films, only one, "Wedding Crashers" was rated R. Two, "The Polar Express" and "Chicken Little," were rated G. The remainder were either PG or PG-13 offerings.
The major studios and their subsidiaries faced slightly differing challenges last year. At the majors, average negative costs were down 3.8% from the previous year, while average marketing costs increased a relatively modest 5.2%. Meanwhile, the subsidiaries held an even harder line on average negative costs, which decreased 19% from $29 million in 2004 to $23.5 million last year. At the same time, the subsidiaries saw their marketing costs increase 33% from $11.4 million in 2004 to $15.2 million last year.
MPAA member companies spent more on network television and Internet advertising and less on newspapers and local television.
"Technology has not only changed the way people are able to view movies, it has changed the way our industry produces and advertises movies. We are exploring new ways to reach more people using innovative methods of communication and distribution," Glickman said.
While in the eyes of exhibitors DVDs are encroaching on theater business as theatrical windows narrow, the Nielsen survey suggested that moviegoing and home viewing aren't necessarily at odds.
Moviegoers who own or subscribe to four or more technologies such as DVD players, big-screen TVs, digital cable and video-on-demand see an average of 8.2 movies per year, the survey found.
By contrast, moviegoers committed to fewer than four technologies, which comprised 80% of the sample, viewed an average of 6.2 movies per year.
The more tech-savvy segment of the audience also comprised the most frequent moviegoers.
Four in 10 moviegoers also reported that they planned to buy the DVD version of the last movie they saw, with more than half making that decision immediately after seeing the movie.
Of the moviegoers questioned, 69% said they preferred seeing a movie in a theater rather than at home. That preference was highest among males under 25, who were 81% in favor of seeing movies in theaters, and lowest among women over 25, who preferred home viewing 36% of the time.
Within the U.S., the dip in admissions was even steeper -- from a recent high of 1.64 billion in 2002, admissions fell to 1.54 billion in 2004 and to 1.4 billion last year, a 8.7% skid between 2004 and 2005. At the same time, the average ticket price increased 3.2%, from $6.21 in 2004 to $6.41.
Preferring to view the situation as a glass half full, though, the MPAA said domestic boxoffice has remained just at or above the $9 billion level -- a benchmark it first topped in 2002 -- for four consecutive years.
The MPAA also reported that the costs of producing and marketing the average film released by member companies declined 0.6% last year. While marketing costs on the average film rose from $34.4 million to $36.2 million between 2004 and 2005, the average negative cost was shaved from $62.4 million in 2004 to $60 million in 2005. As a result, the combined average negative and marketing costs were down just a hair, from $96.8 million in 2004 to $96.2 million last year.
One caveat: negative costs, as reported by the MPAA, represent the amount each studio invests in a film but does not include investments from non-MPAA sources and therefore does not reflect the full costs of production for the average MPAA film.
Despite widespread media reports during the past year depicting moviegoers' dissatisfaction with their experience, the MPAA also released the results of a nationwide survey of moviegoers, defined as theater patrons who see one or more films a year, conducted in August by Nielsen Entertainment/NRG. Using a sample of 3,000 individuals, the survey found that 81% of moviegoers said that a trip to the theater was a good investment in time and money. Only 15% said they would have preferred to watch the movie on DVD, while 4% groused they wished they had not seen the movie at all.
Assessing the data, MPAA chairman and CEO Dan Glickman said: "Despite increasing competition for consumers' time and entertainment dollars, theatergoing remains a satisfying constant in people's lives. That said, we can't bury our heads in the sand. We do have to attract customers and keep regulars coming back. It is no secret that our industry faces new challenges, but with every challenge there is an exciting opportunity."
Glickman is expected to address how best to face the future when he speaks before exhibitors Tuesday at the ShoWest convention in Las Vegas.
According to the statistical picture of 2005 painted by the MPAA, while the number of movies in circulation increased, moviegoers tended to flock to a handful of top-grossers, which had the effect of boosting the average gross of studio releases.
Overall, 563 movies, including 14 reissues, were released last year in the U.S. The market had to absorb 37 more movies in 2005 than it saw in 2004.
The major studios, not including their specialty film labels and subsidiaries, rolled out 194 new features and four reissues.
The average boxoffice for studio releases rose from $34.6 million in 2004 to $37.3 million -- a 7% increase compared with the previous five years.
At the top of the heap, blockbuster films prospered last year. "Star Wars: Episode III -- Revenge of the Sith," the top-grossing film with $380.3 million, did not reach the heights of 2004's leader, "Shrek 2," which pulled in $441.2 million. But by the MPAA's reckoning, for the full calendar year, eight films grossed more than $200 million compared with five films in 2004.
Presented as a line graph, the average gross of the top 10 movies has held relatively steady for the past four years, racking up an average $203.8 million in 2002, $205.2 million in 2003, $205.3 million in 2004 and $203.2 million in 2005.
Of last year's top 20 films, only one, "Wedding Crashers" was rated R. Two, "The Polar Express" and "Chicken Little," were rated G. The remainder were either PG or PG-13 offerings.
The major studios and their subsidiaries faced slightly differing challenges last year. At the majors, average negative costs were down 3.8% from the previous year, while average marketing costs increased a relatively modest 5.2%. Meanwhile, the subsidiaries held an even harder line on average negative costs, which decreased 19% from $29 million in 2004 to $23.5 million last year. At the same time, the subsidiaries saw their marketing costs increase 33% from $11.4 million in 2004 to $15.2 million last year.
MPAA member companies spent more on network television and Internet advertising and less on newspapers and local television.
"Technology has not only changed the way people are able to view movies, it has changed the way our industry produces and advertises movies. We are exploring new ways to reach more people using innovative methods of communication and distribution," Glickman said.
While in the eyes of exhibitors DVDs are encroaching on theater business as theatrical windows narrow, the Nielsen survey suggested that moviegoing and home viewing aren't necessarily at odds.
Moviegoers who own or subscribe to four or more technologies such as DVD players, big-screen TVs, digital cable and video-on-demand see an average of 8.2 movies per year, the survey found.
By contrast, moviegoers committed to fewer than four technologies, which comprised 80% of the sample, viewed an average of 6.2 movies per year.
The more tech-savvy segment of the audience also comprised the most frequent moviegoers.
Four in 10 moviegoers also reported that they planned to buy the DVD version of the last movie they saw, with more than half making that decision immediately after seeing the movie.
Of the moviegoers questioned, 69% said they preferred seeing a movie in a theater rather than at home. That preference was highest among males under 25, who were 81% in favor of seeing movies in theaters, and lowest among women over 25, who preferred home viewing 36% of the time.
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