Disney (and others) at the Box Office - Current State of Affairs

[Wendy Pleakley]

The marvel movies as loss leaders has stuck with me so I asked Grok:

“Likelihood of cinema becoming more of a loss leader for streaming (i.e., theatrical releases increasingly tolerated as unprofitable or low-margin to drive subscriber growth, content libraries, and engagement on platforms like Disney+, Netflix, etc.): 75%.
This higher probability aligns with the ongoing pivot where studios use theatrical as a “loss-mitigator” or feeder for streaming, evidenced by day-and-date releases eroding box office exclusivity and films outperforming on platforms after theater runs.”

So if that is true, you guys are more attuned to the box office to know, how will that change the cinema in the next 10 years?

I don't know if loss leader would be seen as an acceptable approach. Streaming revenue certainly mitigates the risk of theatrical releases, but if they consistently lose money it's probably not sustainable. At that point Disney could go full Netflix and skip the theater completely.

I don't think this is super likely. Theatrical still makes money. Even if many movies need streaming to become profitable, it's still a net positive and there will always be big hits. Endgame doesn't happen, or isn't as big, without so-so performing movies like Ant-Man.

Theatrical releases still benefit home viewing because those movies have better production values and awareness. I'm more likely to buy or stream Thunderbolts at home because it's a theatrical product.

 

[FrontierSpirit]

I don't know if loss leader would be seen as an acceptable approach. Streaming revenue certainly mitigates the risk of theatrical releases, but if they consistently lose money it's probably not sustainable. At that point Disney could go full Netflix and skip the theater completely.

I don't think this is super likely. Theatrical still makes money. Even if many movies need streaming to become profitable, it's still a net positive and there will always be big hits. Endgame doesn't happen, or isn't as big, without so-so performing movies like Ant-Man.

Theatrical releases still benefit home viewing because those movies have better production values and awareness. I'm more likely to buy or stream Thunderbolts at home because it's a theatrical product.

where do you stand on the Varity article?
“When asked “How long do you expect the traditional cinema experience to remain a viable business model?”, roughly 55% of exhibition executives stated that they believed it had less than 20 years”

Are we looking at the next Blockbuster and Sound Warehouse, a business model that decelerates overnight?

 

[Disney Irish]

I don't know if loss leader would be seen as an acceptable approach. Streaming revenue certainly mitigates the risk of theatrical releases, but if they consistently lose money it's probably not sustainable. At that point Disney could go full Netflix and skip the theater completely.

I don't think this is super likely. Theatrical still makes money. Even if many movies need streaming to become profitable, it's still a net positive and there will always be big hits. Endgame doesn't happen, or isn't as big, without so-so performing movies like Ant-Man.

Theatrical releases still benefit home viewing because those movies have better production values and awareness. I'm more likely to buy or stream Thunderbolts at home because it's a theatrical product.

Except that is really what we're heading toward, and studios have positioned themselves up for the eventuality of it happening. Heck it wasn't even 5 years ago where we were talking in these forums about that actual possibility happening in the here and now. 5 years prior to that no one thought it was even a possibility. So times have changed.

I think the main reason why so many have been resistant to the idea of a "no theatrical" model is because we as consumers have been trained that the theatrical model was the only way and that anything lesser was bad for Hollywood. Except that there have been other models used in Hollywood for a long time outside of the theatrical model. The direct-to-video model for example has been around for like 40+ years at this point, and many studios used that to make profit for their movies.

So this idea that its theatrical or nothing is what is not viable. Hollywood will always find ways to make movies and make money, even if theatrical is no longer an option.

 

[coffeefan]

There's a lot to draw from these results.

 

[Wendy Pleakley]

Except that is really what we're heading toward, and studios have positioned themselves up for the eventuality of it happening. Heck it wasn't even 5 years ago where we were talking in these forums about that actual possibility happening in the here and now. 5 years prior to that no one thought it was even a possibility. So times have changed.

I think the main reason why so many have been resistant to the idea of a "no theatrical" model is because we as consumers have been trained that the theatrical model was the only way and that anything lesser was bad for Hollywood. Except that there have been other models used in Hollywood for a long time outside of the theatrical model. The direct-to-video model for example has been around for like 40+ years at this point, and many studios used that to make profit for their movies.

So this idea that its theatrical or nothing is what is not viable. Hollywood will always find ways to make movies and make money, even if theatrical is no longer an option.

We'll see what happens.

Without theatrical you don't get the big hits like Endgame.

Netflix is certainly successful but they're more quantity over quality.

Direct to video is a common model but the product is absolutely inferior. Are movie studios going to abandon the Star Wars and Marvel movies of the world? We're not going to get those movies in a world of Netflix budgets.

Maybe we'll see movie studios move into the theater business. No splitting of box office receipts. Suddenly snacks contribute to a movie's bottom line.

 

[Nevermore525]

Hamilton getting a Theatrical release on September 5 from Disney for the 10th Anniversary of the show

 

[DKampy]

I have a tough time seeing Theaters going the way of the dodo…. Studios need theatrical to prop up their streaming services…the data is in…. Movies have a bigger pop on VOD if they hit cinemas first…. It is why you saw a bunch of movies of higher quality switch from streaming to theatrical…. While a lot of movies that are created for streaming have that straight to DVD quality… some fiilms are clearly even using theaters as an advertising method… such as Companions which was critically praised and built a ton of buzz… only to be released to VOD a couple of weeks later

 

[Disney Irish]

We'll see what happens.

Yes, obviously we're all at the mercy of the industry and what they decide. We have little say on it beyond our own spending habits.

Without theatrical you don't get the big hits like Endgame.

I disagree, I think the hits will still come it just won't be measured in box office take, it'll be measured in viewership, something that is already being done.

Netflix is certainly successful but they're more quantity over quality.

"Quality" is subjective. But they have had hit quality product over the years, including Stranger Things, Wednesday, Squid Games, and the like. Even the recent KPop Demon Hunters appears to gain a following.

Direct to video is a common model but the product is absolutely inferior. Are movie studios going to abandon the Star Wars and Marvel movies of the world? We're not going to get those movies in a world of Netflix budgets.

Who said it had to be inferior? This is the sentiment that came about because consumers thought only quality products went to theaters and inferior stuff that couldn't make it theaters went direct-to-video. That doesn't have to be the case. Netflix and Disney for that matter, has shown that quality product can be streaming exclusives. So the model is there and viable.

Netflix spends hundred of Millions on their Netflix exclusive movies. So why do you think other studios can't do that same in a similar model? Especially since Disney already has proven they can as well with their streaming exclusives. If theatrical isn't a viable long term distribution model anymore then the same movies will just be pushed to streamers. The economics can be worked out where since a studio is getting more, or in the case of a Netflix, Disney, or Amazon all of it, of the revenue they don't have to worry about having to double to triple the box office in order to just break even. They just have to have enough revenue coming into the streamer to cover content costs, and both Disney and Netflix are profitable in that regard.

Maybe we'll see movie studios move into the theater business. No splitting of box office receipts. Suddenly snacks contribute to a movie's bottom line.

That might be an option, and might be something that has to happen in the short to medium term especially if chains like AMC, Cinemark, and Regal start to go under. But I suspect long term even that will end up being just a stop gap measure, not one that "saves theatrical".

 

[Disney Irish]

I have a tough time seeing Theaters going the way of the dodo…. Studios need theatrical to prop up their streaming services…the data is in…. Movies have a bigger pop on VOD if they hit cinemas first…. It is why you saw a bunch of movies of higher quality switch from streaming to theatrical…. While a lot of movies that are created for streaming have that straight to DVD quality… some fiilms are clearly even using theaters as an advertising method… such as Companions which was critically praised and built a ton of buzz… only to be released to VOD a couple of weeks later

Remember it was just 5 years ago where we all were having this same discussion as the pandemic looked to really shutdown theaters forever. So just because something doesn't seem possible doesn't mean its not.

So yes for now it seems that theatrical props up streaming/PVOD, but for how long? As the saying goes nothing lasts forever. And its clear that theater owners themselves are worried about it, and studios are planning for it. So this idea that it "can't happen" is more wishful thinking than anything.

So for this isn't not an "if" its more of a "when" type of situation. Will it be, 10, 15, 20, 50 years down the line, who knows but I can almost with 99% certainty guarantee theatrical will go away eventually. The technologist in me knows it'll happen. And so far with these type of predictions I've been batting almost 1000. Its why I was able to predict the D+ stuff with fairly reliable accuracy, including the merging and shutting down of Hulu as a standalone app which was just announced today.

So some can say it won't happen, fine by me. But time is not on our side here. As every year the box office on average is getting worse and it doesn't look to be getting better. But hey maybe 2026 will be the year it all comes back.

 

[Agent H]

The idea that Disney is going to shutdown Marvel after Secret Wars in 2027 is not only silly, its downright insulting.

It ain't happening, so don't even know why you even put it out there.

I suspect if they don't immediately go to the next thing (Mutants) in 2028/2029 they'd do a "pause" like they did with Star Wars. But they won't stop it completely, not happening. Just like they didn't fully stop with Star Wars, they won't with Marvel either.

If they stop making marvel movies in any way shape or form I’ll eat my fedora.

 

[JackCH]

Remember it was just 5 years ago where we all were having this same discussion as the pandemic looked to really shutdown theaters forever. So just because something doesn't seem possible doesn't mean its not.

So yes for now it seems that theatrical props up streaming/PVOD, but for how long? As the saying goes nothing lasts forever. And its clear that theater owners themselves are worried about it, and studios are planning for it. So this idea that it "can't happen" is more wishful thinking than anything.

So for this isn't not an "if" its more of a "when" type of situation. Will it be, 10, 15, 20, 50 years down the line, who knows but I can almost with 99% certainty guarantee theatrical will go away eventually. The technologist in me knows it'll happen. And so far with these type of predictions I've been batting almost 1000. Its why I was able to predict the D+ stuff with fairly reliable accuracy, including the merging and shutting down of Hulu as a standalone app which was just announced today.

So some can say it won't happen, fine by me. But time is not on our side here. As every year the box office on average is getting worse and it doesn't look to be getting better. But hey maybe 2026 will be the year it all comes back.

I think some of what you say is true, however I think it more likely theatrical pivots rather than goes away. Of course if it’s 50 years from now it could be gone, but that’s not really much of a prediction. Literally anything could feasibly happen in that amount of time. If I was a betting person I would almost for sure think theaters will still be here 10 years from now. Beyond that, I’m not sure how much we can reliably prognosticate. Too many moving factors.

Why do people go to movies instead of just watch from home? I’d argue three main factors: 1) see films that excite them and aren’t out on home video yet, 2) get the high quality movie experience, and 3) as a social outing. (1) and (2) could certainly change over time, but a lot people still love going to movies together, so that market is likely still to exist in some form for the foreseeable future.

 

[Disney Irish]

I think some of what you say is true, however I think it more likely theatrical pivots rather than goes away. Of course if it’s 50 years from now it could be gone, but that’s not really a prediction. Literally anything “can” happen in that amount of time. If I was a betting person I would almost for sure think theaters will still be here 10 years from now. Beyond that, I’m not sure how much we can reliably prognosticate. Too many moving factors.

Why do people go to movies instead of just watch from home? I’d argue three main factors: 1) see films that excite them and aren’t out on home video yet, 2) get the high quality movie experience, and 3) as a social outing. (1) and (2) could certainly change over time, but a lot people still love going to movies together, so that market is likely still to exist in some form for the foreseeable future.

Sure anything "can" happen. And I'm not saying that theatrical will go away next year, but in the next 15-20 yeah I can see it.

But take your point and flip it, why are more people now watching movies at home instead of going to the theaters? Which is the whole point that we've been talking about this year as the box office is down overall. And there are 3 main factors, 1. Cost, its cheaper to watch at home, 2. can get almost the same quality at home as you can at the theater, and 3. the ability to pause and not have to miss anything if you get interrupted or need to go to the bathroom.

 

[JackCH]

Sure anything "can" happen. And I'm not saying that theatrical will go away next year, but in the next 15-20 yeah I can see it.

But take your point and flip it, why are more people now watching movies at home instead of going to the theaters? Which is the whole point that we've been talking about this year as the box office is down overall. And there are 3 main factors, 1. Cost, its cheaper to watch at home, 2. can get almost the same quality at home as you can at the theater, and 3. the ability to pause and not have to miss anything if you get interrupted or need to go to the bathroom.

Fair enough and you make good points. For me it is the third reason (movies as a social outing) that leads me to think it’ll exist in some form for a while. For a lot of people in a lot of places it is one of the few really enjoyable indoor outings. But you are right even that can change for sure and it is already not as popular as it used to be!

 

[Disney Irish]

Fair enough and you make good points. For me it is the third reason (movies as a social outing) that leads me to think it’ll exist in some form for a while. For a lot of people in a lot of places it is one of the few really enjoyable indoor outings. But you are right even that can change for sure and it is already not as popular as it used to be!

Sure and I see that social aspect, but instead of going to a theater you can just go to someone’s house and get the same thing. So really other than it being a “location” to go to there is becoming less and less of a reason for theaters other than the current box office revenue. And as we’ve been discussing that revenue is starting to dwindle.

So yeah I just don’t see it being long for this world in another decade or two.

 

[CoastalElite64]

Yep, Russo brothers will make FF cool like they did Thor and others.

 

[Ayla]

Sure anything "can" happen. And I'm not saying that theatrical will go away next year, but in the next 15-20 yeah I can see it.

But take your point and flip it, why are more people now watching movies at home instead of going to the theaters? Which is the whole point that we've been talking about this year as the box office is down overall. And there are 3 main factors, 1. Cost, its cheaper to watch at home, 2. can get almost the same quality at home as you can at the theater, and 3. the ability to pause and not have to miss anything if you get interrupted or need to go to the bathroom.

4) Because the general public are morons who have no manners.

 

[DKampy]

Remember it was just 5 years ago where we all were having this same discussion as the pandemic looked to really shutdown theaters forever. So just because something doesn't seem possible doesn't mean its not.

So yes for now it seems that theatrical props up streaming/PVOD, but for how long? As the saying goes nothing lasts forever. And its clear that theater owners themselves are worried about it, and studios are planning for it. So this idea that it "can't happen" is more wishful thinking than anything.

So for this isn't not an "if" its more of a "when" type of situation. Will it be, 10, 15, 20, 50 years down the line, who knows but I can almost with 99% certainty guarantee theatrical will go away eventually. The technologist in me knows it'll happen. And so far with these type of predictions I've been batting almost 1000. Its why I was able to predict the D+ stuff with fairly reliable accuracy, including the merging and shutting down of Hulu as a standalone app which was just announced today.

So some can say it won't happen, fine by me. But time is not on our side here. As every year the box office on average is getting worse and it doesn't look to be getting better. But hey maybe 2026 will be the year it all comes back.

Well if studios lose theaters….either the price of movie tickets will be nothing compared to the cost of streaming/PVOD…or the quality will drop…. most studios have cut back on the production costs on their streaming content…. Which tells me streaming has not proven to be the cash cow many thought it would be

As someone who has every major streaming service since I cut the cord… the streamer I watch the least is Netflix…The one streaming service that does not rely on theaters…. They Probably have about 1 item that breaks through the mainstream a year and most films are generally awful

 

[Disney Irish]

Well if studios lose theaters….either the price of movie tickets will be nothing compared to the cost of streaming/PVOD…or the quality will drop…. most studios have cut back on the production costs on their streaming content…. Which tells me streaming has not proven to be the cash cow many thought it would be

Or they choose to focus their money on the current model which is still theatrical rather than to split it on both streaming and theatrical releases. But as theatrical dries up you will see a return to the focus on streaming content. This is exactly what happened in the early days of the pandemic, studios started to gear up toward streaming only because it was unknown if theatrical would survive. The same will happen again if theatrical does start to go away in the future. Its not like Hollywood will just stop making movies just because theatrical ends, that I would imagine would be a collapse of Western Civilization if that ever happened.

So yes if streaming/PVOD becomes the main distribution model you can for sure expect prices to change to reflect that. You can sort of already see that with the recent price increases in all streaming services.

As someone who has every major streaming service since I cut the cord… the streamer I watch the least is Netflix…The one streaming service that does not rely on theaters…. They Probably have about 1 item that breaks through the mainstream a year and most films are generally awful

And I'm not saying that a majority of current streaming content isn't of lower quality, but that won't be the case forever. If streaming/PVOD becomes the main distribution model you can for sure bet that the quality will rise. But also its not like streamers don't have content that is of quality, Netflix, Disney, Amazon, and even Apple all have streaming exclusives that have been quality content.

 

[Disgruntled Walt]

It's a shame about FF. I really enjoyed the film and hoped it would be successful. It does deserve it.

 

[Tony the Tigger]

And in other news, other movies are opening this week -

‘Freakier Friday’ Review: Lindsay Lohan and Jamie Lee Curtis Reunite for a Sequel That Kicks Up the Body-Swap Complications but Not the Comedy

Lindsay Lohan and Jamie Lee Curtis reunite for a juggling-balls-in-the-air Disney romp that kicks up the body-swap complications but not the comedy.

variety.com

This is one of the few films that I have such an affinity for the original version, I never saw the remake, so I wouldn’t see the sequel. I don’t want to taint the Jodie Foster version in any way.

can get almost the same quality at home as you can at the theater

only to a point. Barely anyone has giant screens, they might have large screens, but not giant. Even those who have very large screens are not a huge percentage.

Home is fine to just “watch a movie.“ I don’t think it compares to going to the movies.