CinemaCon: NATO's John Fithian Talks End of Film, Box Office Decline (Q&A)
This story first appeared in the April 26 issue of The Hollywood Reporter magazine.
The fate of 3D, China's acquisition spree and the promise of a box-office recovery are sure to dominate this year's edition of CinemaCon, the annual convention of exhibitors hosted by the National Association of Theatre Owners in Las Vegas. CinemaCon (formerly ShoWest), now in its third year, is expecting its busiest show yet, with every major Hollywood studio parading its upcoming slates during glitzy, star-filled presentations in the giant Colosseum theater at Caesars Palace. On the eve of the gathering, which runs April 15 to 18, NATO president and CEO John Fithian offers his perspective on the industry's challenges.
Domestic box-office revenue was down substantially in the first quarter and is still running 12 percent behind last year. Are you concerned?
The reason why the first quarter of 2013 was down is the same reason why the first quarter of 2012 was up -- the choice of movies in the marketplace. We did not have enough of a mix of movies. There were too many R-rated, violent movies. There weren't enough family titles or films rated PG-13. It's all about the mix of movies, and when we do well, it's because all of the audience is served. But I think the rest of the year will be strong. There are always cyclical blips.
What came out of your meeting with Vice President Joe Biden when the issue of violence in media resurfaced in the wake of the Newtown, Conn., school shooting?
At CinemaCon, we will be rolling out a new public-service announcement to better educate parents about the ratings system. NATO and the MPAA, along with other industry groups, made a commitment to the vice president to redouble our efforts.
Will there be changes to the ratings system?
It's about continuing to improve our record. The Federal Trade Commission just released the results of a "mystery shopper" survey showing that the vast majority of teenagers are being turned away from R-rated movies. The system is working -- but when the president and the vice president of the United States say, "Up your game," you up your game.
There's continuing concern over the decline in 3D attendance, particularly for family films. Is the alarm warranted?
After Avatar and Alice in Wonderland, people thought 3D was going to be the greatest thing the industry ever experienced. Then it dropped off, and people thought 3D was going to die. The reality is, 3D is stable. On the issue of families, I think at the outset of this we thought 3D was primarily good for kids and not for other stuff. It's turned out to be different, with 3D action pics and superhero movies doing well.
Do you have any idea why?
I think the expectations were too great.
Do you think movie tickets are overpriced? The average ticket price was $7.96 in 2012, but it is much higher in many metropolitan areas.
I am always amused when Wall Street analysts or studios say we face a challenge because of ticket prices. If you go back 40 years and do the calculation, ticket prices have gone up at a rate that's slightly less than inflation. At the same time, we have transformed the cinema experience to the betterment of our patrons with stadium seating, digital projection and sound, and 3D, among other expensive enhancements.
China is a hot topic. What do you make of the acquisition of AMC Entertainment by Chinese conglomerate Dalian Wanda Group?
The partnership is working extremely well. I think what leading Chinese business leaders are saying is that the exhibition market in North America is strong, and they want to learn from it. It's the biggest acquisition to date of an American company by a private Chinese venture. And I hope they take what they are learning about our free market and go back to China and loosen up theirs.
Every major studio is coming to CinemaCon this year. Disney will even show extended footage of The Lone Ranger, while Fox may sneak some of Ben Stiller's The Secret Life of Walter Mitty. Why?
It's about marketing excitement and getting exhibitors fired up so that they go back home and educate their staff and create a general buzz.