The Slow Decline of the Entertainment Industry

Before the pandemic, going to the movies was a common luxury that many people took for granted. As COVID-19 continues to keep people at home and avoiding large crowds, the global movie industry has lost $10 billion as of May 2020. 

While the theaters were closed, many films went straight to streaming platforms instead of having a theatrical opening, and for those that were in theaters, the “window” from theater to streaming was shorter than it usually is. The window is usually three months between when a movie is in theaters to when it is offered for on demand or rental. 

Movies like The King of Staten Island and Scoob! did come out on streaming services for people to watch at home, but it still doesn’t feel the same as sitting in front of the projector. There are a few films that were in theaters for a short period of time, but they did not do well due to low attendance. Emma, The Invisible Man and Birds of Prey were only in theaters for about a month before being able to be streamed within the first few weeks of March.  

The projections for the next five years don’t look good for the entertainment industry. The industry, which ranges from studios to theaters, could lose up to $160 billion by 2025 due to COVID-19. The largest theater operator, AMC, has lost about $561 million in the most recent quarter, and Regal Cinemas around the United States are closing their doors for a short period of time as major movies that were supposed to be released this fall were pushed back until spring 2021. 

While this may come as a surprise, the industry was already starting to slowly fail even before the pandemic. There was already a decline in theater attendance, with a 4.6% decline in 2019 to only about 1.24 billion people attending to see major blockbuster films. This is most likely due to the rise in home media like Netflix or Hulu and the rising prices of movie tickets. Why would someone pay $10 to see a movie when that is about the same price of a monthly Netflix subscription?

From small to large studios, everyone is hurting. Movie financing will take a hit as they will have to follow health guidelines, which means increased health security and insurance costs. Independent studios, which include A24 and Bleecker Street, will find it harder to raise funds as they compete with bigger studios. 

There is a positive to all of this though, as it has become almost normalized for movies to go straight to on demand rather than waiting for a period of time after theater showings.

With an industry that is valued at $717 billion, it is the largest industry in the world that is flying by the seat of its pants. We can only hope that theaters can open safely within state and federal health guidelines to bring some revenue to studios everywhere. 

 

Sources- 1,2,3,4,5 

Photos: Her Campus Media Library