Over the Past 5 Years, Netflix Earnings has Increased Steadily by Over 1 Billion Dollars per Year
As many people may know or at least assume, streaming services such
as Netflix, Hulu, HBO Go, etc. have flooded the market the past 5
years. These services have not only proved to be wildly successful but
also a staple of popular culture here in the United States. Instead of
having to rent movies from Redbox, On Demand, or even buying a movie,
you are now able to access thousands of movies right at home thanks to
these services. Most of the movies are older and well beyond their DVD
releases, but there is still an abundance of movies that you can now
enjoy in the comfort of your home as opposed to going to the movie
theaters. This in and of itself is not the lone factor contributing to
these streaming services meteoric rise in success and popularity. The
television aspect of these subscription services are arguably just as
much if not more important than the movie aspect. However, I will be
directly dealing with the film side of these services and the impact it
has caused on the movie industry as a whole.
Just
this past year, there was a major controversy surrounding a comedy
movie being made that satirized Kim Jong Un and North Korea. The
Interview starring Seth Rogen and James Franco was originally intended
to be released nationally same as any other bigger-budget movie.
However, Kim Jong Un actually threatened to bomb the United States for
showing this movie and making fun of him and his country. In response to
this, The Interview was not released in any movie theaters but rather
went straight to streaming services and on demand. The only other movie
that had employed this tactic before, and also not out of necessity, was
Crouching Tiger Hidden Dragon. The Interview ended up still earning a
decent amount of money thanks to the deals it made to release the movie
via the streaming services. It remains to be seen whether this was an
aberration or could prove to be a viable business model for streaming
services and movies moving forward.
In Same Time Frame, Movie Theaters Profits Remained Approximately Equal to Years Past Despite Decline in Ticket Sales
On the other hand, the movie industry has been earning
approximately the same amount of money the past 5 years. Granted, the
movie industry as a whole has not increased or decreased in terms of
revenue much since the early 2000’s. This proves that the industry as a
whole is pretty consistent and despite the rise in streaming services
the past couple of years there will still be plenty of money to be made
at the box office. However, the problem is that the industry as a whole
has seen a steady decline in ticket sales over the same time frame. This
means that the movie theaters are somehow still managing to earn a
profit in other ways aside from more people coming in to watch the
movies. Therefore, ticket prices, food, and drinks have seen a hike in
prices often labeling the movie experience as a whole as being
“over-expensive”.
All of these problems should
be concerning to movie theaters considering the increase in overall
quality of movies thanks to technological advancements in recent years.
Computer Generated Images (or CGI) for short, has become easier and less
expensive to do within movies which allows for more fantastical action
and environments than ever before. Not to mention, all while looking
incredibly realistic to the point of not knowing that scenes were shot
in front of a green screen. Most would argue that these incredible
scenes and sequences are made to be seen on the biggest movie screen
possible at the movie theaters. The highest grossing movies of the past
three years: Avatar, Avengers, and Guardians of the Galaxy respectively,
all relied heavily on CGI to create a fun movie experience that
arguably would not be the same on a TV at home. This proves that the
movie industry is still improving in the sense that people are going to
see these movies that certainly would not have been able to be made even
a decade ago. The respective movie theaters need to do a better job of
capitalizing off of these better quality movies in order to get more
people in to the theater thus making more revenue.
In Order to Compete, Some Movie Theaters are Adapting to More of A “Luxury” Feel
Instead of relying on the individual movies themselves to bring more
people in, many movie theaters are taking it upon themselves to create a
favorable movie experience. Typically, there are hundreds of stiff
seats with limited reclining crammed into a pretty small area with not
much leg room in order to have as many people in to see one movie at a
time. Now some theaters have made changes that include massive lounge
chairs and/or waiter services while you watch the movie. Whether or not
these changes are a direct response to the rise in popularity of
streaming services is unclear. However, these niche sort of experiences
have provided viewers enough incentive to leave the comforts of their
own house to go see a movie. Meanwhile, the expanded service provides
the theater with more ways to make money via concessions thanks to the
help of waiters during the movie.
The videos taken of random students here at the University of Maryland were placed in accordance with the context of the paragraphs. In each instance, I think their reactions spoke lengths to supporting the arguments being made in favor of streaming services and the changing direction of the movie industry as a whole. The selected videos were simply the best responses however the overwhelming reaction amongst the students was that streaming services are the more favorable option. As an avid moviegoer and someone who loves both for what they are worth, I believe that movie theaters truly do need to find some other way to change the game and level the playing field with the streaming services who are now dominating the competition for viewers and customers.
