Netflix CEO: Movie Theaters Are 'Strangling the Movie Business'' (businessinsider.com)

Netflix CEO Reed Hastings thinks the state of film is a "real tragedy" and that movie theaters are "strangling the movie business," he said at The New Yorker's Tech Fest on Friday. From a Business Insider report:On Friday, Hastings came down hard on these theater owners, saying there had been no innovation in the movie theater business in recent years, even as TV has been shaped by the rise of cable and internet networks. "Money" and "innovation" has flooded to the TV industry, Hastings said. Not so with film. The movie theater business has seen flatline revenue, Hastings said. Part of the problem is that small movies, such as many Netflix has snagged from places like Sundance, would be better distributed both at home and in theaters. That's a convenient position for Netflix to take, but Hastings said the movie studios feel the same way. Each movie studio would like to "break the oligopoly" of the theaters, but "they don't know how," he continued. If they collude to face the theaters, it's anti-trust, but if they are the ones to take the first step, their films will get killed. That means they just go along with the status quo.

Comments

Re:Movie theaters

[jedidiah]

> People with AR-15's spraying bullets up and down the aisles?

You're more likely to get hit by lightning while spontaneously getting 3 different rare diseases.

Re:A biased opinion

[Anonymous Coward]

This is a common misunderstanding. Movie theatres make plenty of money from showing movies. It is true that the vast majority (~90%) of revenue from brand new films (typically a film is a 'special engagement' from release through the end of its second weekend) goes back to the studio. However, the studio's take drops rapidly after that point, eventually tilting in the theatre's favor. A large chain with a good film buyer and strategies in place to ensure movies perform as well as possible during an extended run can get their overall 'film rent' below 60%. But, even at 90%, the theatre's box office take isn't "barely any money." The nice thing about tickets is that everyone pays for them, while many customers don't visit the concession stand. When I ran a movie theatre, our average ticket price (which factors in free passes, discounted tickets, matinees, child tickets, etc.) was about $7.50. Our net concession per capita was about $2.40. 75 cents may pale in comparison to $2.40, but it is definitely significant...and this is absolutely the worst case scenario.

It is a Government-created problem.

[MyFirstNameIsPaul]

The studios are not allowed to own their own theaters, per the 1948 ruling in United States v. Paramount Pictures, Inc.. The ruling is the same as making the claim that Matco can't make it's own tools and sell them from their own trucks or Apple can't sell iPhones from its own stores. Totally lame and arbitrary and definitely contributes to reduced investment, thus reduced innovation.