US Airways does away with in-flight movies

Studios do not expect others to follow suit

The Hollywood studios will take a revenue hit when US Airways does away with in-flight movies, but execs don't expect other airlines to follow suit.

Nontheatrical distribution contributes $25 million or more per studio in annual revenue and more than $300 million among all media companies, with film and TV sales to airlines accounting for about 80% of that total. Other sources of nontheatrical sales include the hospitality and institutional markets.

US Airways said Tuesday it would stop offering in-flight movies on domestic flights this fall to cut expenses, citing pressure from rising fuel costs. Although airlines are often prone to copycat moves on pricing and customer services, Hollywood execs in regular contact with airline officials said Wednesday they don't believe other carriers will follow US Airways' lead this time.

"I don't expect that the major national airlines will follow suit," said Julian Levin, Fox's exec vp in charge of nontheatrical sales. "I think they will continue to offer entertainment to their passengers, even in the extremely difficult environment of rising fuel costs."

Others involved in in-flight film sales agreed.

"This is probably not an industry trend, as US Airways is in the most trouble right now," said one studio executive, who asked not to be identified.

Meantime, another disconcerting trend for Hollywood has seen many airlines make big cuts in the number of daily flights they operate. Deals between studios and airlines vary, but fewer flights generally mean lower movie revenue for Hollywood.

More positively, studio execs take heart in airlines' moves to install digital playback systems for in-flight entertainment. Such systems often feature seatback screens, which airlines have used to offer even coach customers the ability to view multiple movies during long domestic and international flights.
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