Multiplex Economics

March 23, 2010
A thought by James Berardinelli

Once, not that many years ago (or so it seems), taking the family to a movie was easily the most cost-effective way of spending an evening out together. That remains true today, even with sky-high concession prices and 3-D surcharges - it's cheaper for Mom, Dad, and the two kids to trek to the local AMC than it is to go to a major league sporting event (baseball, football, hockey, basketball), an amusement park, a concert, a live stage show, or just about any alternative. The only event I can think of that might be kinder on the wallet is attending a minor league baseball game, where tickets often go for $5 or less.

Still, the movies aren't exactly inexpensive. Let's tally up what an average multiplex night will cost for a family of four (for argument's sake, offspring #1 is 13 and offspring #2 is 10). Four tickets to a prime time 3-D movie: $10 (adult ticket) x 3 +$7 (child ticket) x 1 +$3 (surcharge) x 4 = $49. Two small soft drinks @ $3.75 each and two medium soft drinks @ $4.25 each = $16 drink budget. Two large popcorns (split among the four) 2 x $6.75 = $13.50. That's a total of $78.50 (and this doesn't include parking, which is sometimes not free in city locations). Ouch. Suddenly the $3 I shelled out to sit in a theater all day watching Star Trek II in 1982 seems like a steal.

I never eat food in theaters. I find that it interferes with my ability to enjoy a movie. Multiplexes hate people like me because they make most of their money from concession sales. On opening weekend, they might get 20% of the box office but they get to keep 100% of the popcorn, hot dog, soft drink, and candy proceeds. For the hypothetical family above, the AMC got only about $10 from tickets but they brought in $29.50 from popcorn and Pepsi. One reason why auditorium surfing is not actively discouraged is because the theater makes money. Someone who comes at noon to see five movies may only pay a one-time $7.50 matinee entrance price but, over the course of the day, he'll probably spend in excess of $20 at the concession stand (two large sodas, one large popcorn, a hot dog, a pretzel, and an ice cream: 2 x $4.75 + $6.75 + $4 + $4.25 + $3.75 = $28.25). The loss to the multiplex on the four unpaid tickets is only about $10. They're in the black.

As a kid, I rarely went on movie excursions with my parents. Every summer, we'd spend a couple of weeks at the shore. We'd go to summer block parties and 4th of July fireworks. Baseball games were in the offing as were annual trips to Great Adventure (before Six Flags purchased it). But rarely movies. In fact, I can't remember ever attending an indoor movie with my mother, father, and two sisters. (We went to a few drive-ins together.) For my first movie, when I was nine years old, it was me and my father. The next few movies I remember were attended without my dad (who was at work) or with my friends. Popcorn was purchased in most cases but I did not partake. The fake butter primed my gag reflex.

Fifteen years ago, it was a common practice for patrons to rant about the then-new practice of showing commercials before movies. You never hear about that anymore; movie-goers have become accustomed to it as multiplex owners knew they would. I vented my outrage a couple of times, but I wasn't as incensed as I may have sounded. The reason: I almost never arrive until 3/4 of the way through the previews so I'm unaware of what gets shown before the lights go down. (It's easy to plan. AMC shows 15-18 minutes of previews, so all it requires is to arrive at the theater about 10 minutes after the posted start time. I almost never go at a time when there's an issue with seating.)

In 2010, there are two active scams, both of which I have previously discussed. I don't mind repeating myself, however.

The first is the standard multiplex version of IMAX (known variously as "lie-MAX" and "fake IMAX"). A few years ago, megaplex chains signed a deal with IMAX that allowed them to call a minimally altered auditorium an "IMAX venue." What was done to accomplish this conversion? Were ceilings lifted to make room for the huge screen? Was the grade of the stadium seating steepened? No and no. A couple of rows of seats were removed at the front and the screen was expanded by a total of about 20 square feet. The sound system, at least, holds to IMAX standards, but the visual presentation is a joke. Anyone who has attended a real IMAX theater knows better than to accept this pale imitation.

I remember being excited two years ago when I learned that my local 24-plex was going to add an IMAX theater. I kept looking for the construction equipment. I expected the back of the building to be ripped out and the ceiling to be raised by at least 20 feet. But I never saw anything. This was troubling; I assumed the IMAX opening would be delayed. That was not the case; it opened as scheduled. The first time I got a look inside, I understood why. The differences were almost imperceptible. Yet that wasn't stopping AMC from charging an extra $4 per ticket to sit in that auditorium. I have seen a few movies in the fake IMAX theater (mostly at press screenings) and experience is (at best) marginally improved over the one I could have one theater over for $4 less. People either aren't aware or don't care. The IMAX auditorium is almost always full despite the surcharge. The IMAX brand name retains the reputation of quality, regardless of the truth. Sort of like Toyota.

Which brings me, like a dog to its vomit, to 3-D. Faithful readers knew I'd get here eventually. These days, although all roads might not lead to 3-D, many of them do. Avatar is an anomaly. It showed the potential inherent in the formula, but it stands alone atop a mountain. How many other movies have done an acceptable job with the technology? Three? Four? Five? (Here, I'll give Robert Zemeckis some credit - his animated 3-D endeavors, although not on par with Avatar, have at least displayed an understanding of how to use 3-D. Similar comments can be made about Coraline.) The first big post-Avatar 3-D blockbuster, Alice in Wonderland is an unmitigated disaster in 3-D, primarily because the 3-D is converted not native. In a previous column, I likened this to colorization and I feel more strongly today that this is the case than when I first wrote it. Converted 3-D is a gimmick - an approach designed to bilk movie-goers out of $3 extra. The dirty secret is that Alice in Wonderland is a better experience in 2-D than it is in 3-D. It's brighter, more colorful, free of motion blur, and doesn't require the discomfort of wearing the glasses.

Now there's a rush to convert nearly every potential blockbuster, which is perhaps the most depressing motion picture-related development since Shakespeare in Love won the Best Picture Oscar. Worse still, it's becoming difficult to find 2-D prints of these big movies. My local, ancient 8-plex recently purchased a 3-D projector so they are no longer a reliable source of 2-D prints. They're currently showing Alice in Wonderland in that format. During the first weekend in April, it will be Clash of the Titans. Both press screenings of Clash are in 3-D. The AMC 24-plex informs me they will be showing it only in digital 3-D. If I want to see it in 2-D, where do I go?

The only non-converted 3-D films in 2010 will be the animated ones. I have high hopes for Toy Story 3-D, primarily because of Pixar's track record with quality control. I'm less sure of the Dreamworks offerings - Monsters vs. Aliens soured me on the company's ability to handle 3-D. After months of preaching how 3-D was the next big thing, Dreamworks turned out a movie in which it was used precisely in the manner they claimed it would not be: as a gimmick.

Dollars speak louder than words, however, no matter how heartfelt and passionate the latter may be. Those who claim to be unconvinced that 3-D isn't a fad aren't looking at the box office receipts. 3-D is a cash cow; it's not going anywhere. 2010 will see the number of 3-D releases almost double from last year. They'll go up again 2011, when we'll start to see a few "genuine" 3-D features (those shot using 3-D cameras). By 2012, 3-D releases may be arriving at a rate of more than one per week. 2-D will be a fading reality for horror, action/adventure, science fiction, and even some comedies. Dramas will be the last hold-out.

Now comes the news that James Cameron is converting Titanic into 3-D. My gut reaction is to shout in despair, but Cameron's track record has earned him more confidence than that. So I'll wait and see. He's got two years to do the conversion so, at a minimum, it won't be a rush job. (Clash of the Titans was converted in about two months.) I'm not eager to sit through all of Titanic again - I like the movie, but I have already seen it four or five times - but I'll do it because of Cameron. If it was another director, I'd give it a pass. Of course, I'm wondering if the 3-D-ization of Titanic is just a ploy to recapture the #1 all-time domestic box office position. Titanic 3-D would only have to make a paltry $175 million (or thereabouts) to knock Avatar to #2. With the $3 surcharge, that should be easy.

The real question about 3-D isn't whether it's here to stay but what filmmakers will do with it. By 2012, the "conversion period" should be over. Movies that are intended to be released in 3-D will be filmed in 3-D. Theoretically, this should mean we'll be entering the 3-D Golden Age. But that presupposes directors not named Cameron will have the vision and the ability to use the technology to its fullest. I'm skeptical. Some filmmakers will employ it as a tool. I'll be interested to see the first 3-D efforts of Spielberg, Jackson, and (if he does one) Scorsese. For most, however, it will be a toy. There's no reason to suppose that Michael Bay's movies are suddenly going to be watchable just because they're in 3-D. They are, in fact, more likely than ever to induce head-aches.

All of this will guarantee, however, that the gap between theaters and home video widens. Even once 3-D is available for the home, it's not the same thing on a TV screen (no matter how big) as it is in a darkened theater. 3-D is a lifeline for multiplexes that might otherwise have become relics in another decade or two. Does it matter that the dividing lines between video games, movies, and amusement parks are blurring? Not to the people who count the money. And, apparently, not to the people who pay it, either.