Film Industry, Led By Electronic Delivery, Will Grow in Every Category Through 2015: Report (Exclusive)
Netflix and other streamers, as well as 3D, Blu-ray, kiosks and cinema advertising will each do their part to make sure the film industry prospers domestically and worldwide for the next several years, according to PwC.
The film industry domestically and worldwide will grow at a healthy clip through 2015 as Blu-ray and electronic-delivery make up for waning DVD sales and rentals, 3D helps box office revenue grow despite stagnant ticket sales and in-theater advertising comes into its own.
That's the word from PricewaterhouseCoopers and its annual Global Entertainment and Media Outlook report due out today.
In North America, the film industry should generate $40.8 billion in revenue this year and $50.3 billion in 2015. Globally, it should generate $88.8 billion this year and $113.1 billion in 2015, according to PwC.
In North America, PwC estimates $12.2 billion in box office revenue this year and $27.9 billion in home video. The box office will grow to $15.5 billion because of rising prices for tickets and 3D premiums while home video will rise to $33.9 billion. Every category of film, even the various home entertainment sub categories, will grow, including sell-through, courtesy of Blu-ray, and in-store rentals, courtesy of kiosks like Redbox.
The report notes that in 2010, seven 3D titles accounted for 20% of the domestic box office: Avatar, Toy Story 3, Alice in Wonderland, The Twilight Saga: Eclipse, Despicable Me, Shrek Forever After and How to Train Your Dragon.
Despite the overall bullishness of the report, PwC warns: "The novelty effect of 3D may be waning, and because of the higher price points for those releases, people may become more selective in choosing to go to a 3D film. Nevertheless, we believe 3D will have a long-term positive impact on admissions because it helps distinguish the theatrical experience from the home video and online experiences of watching a movie."
About the home-video market, PwC says: "Blu-ray discs may be approaching a critical mass where sales are large enough to counter the impending demise of DVDs."
Electronic delivery of movies, which is all the rage as Netflix, Apple, Amazon.com and others have a profound impact on distribution practices, will grow from $4.8 billion this year to $7.6 billion in 2015. That category generated just $1.2 billion in revenue in 2006, according to PwC.
From 2011-2015, electronic will be the fastest-growing segment of the North American film industry, with 13.8% compound annual growth. That's followed by cinema advertising (6.7%), the box office (6.1%), physical sell-through (3.9%) and in-store rentals (1.4%). Globally, the order in growth nearly identical, the exception being that the box office will slightly outpace cinema advertising.
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