High prices bring empty theaters
Box-office record misleads because of admission costs
By John Horn The Associated Press
UNIVERSAL CITY, Calif. — "Jurassic Park" may have broken the all-time box-office record, but it owes a lot of its financial success to soaring ticket prices.
With movie patrons faced with $7.50 admissions in some cities, and the average ticket costing more than $5, this summer's "Jurassic Park" grosses are misleading. Both 1939's "Gone With the Wind" and 1982's "E.T. The Extra-Terrestrial" totaled more admissions in domestic theaters.
Thanks to rising prices, discount theaters called dollar houses have become fashionable. One studio chief said ticket prices would have to come down or the industry would suffer. The theater owners, meanwhile, said they would lower their prices as soon as the studios give them better deals on movie rentals.
What makes the ticket prices more remarkable is that the trend in home video runs completely in the opposite direction. Not too long ago, video renters had to join a club. Today, clubs are nonexistent, and thousands of tapes can be rented for just $1.
Video retail prices are equally cheap. Combined with a $5 rebate, a cassette of
"Aladdin" can be purchased for about $11.
Since 1979, movie ticket prices have more than doubled, according to the Motion Picture Association of America. At the same time, movie admissions have declined from 21.6 million a week to 18 million a week.
"Movies are too expensive right now," said Tom Pollock, chairman of the MCA Motion Picture Group, whose Universal Pictures produced "Jurassic Park."
"We think there's a value problem," he said. "If the customer perceives that he's not getting value, that's not good for the business, and we'd like to see something done about it. Clearly, people are going to the movies at dollar houses because they are cheaper."
Many viewers choose to wait a month and rent the movie on home video — even cheaper than a dollar house date.
Last year, Universal asked theaters showing its films to offer half-price admissions every Tuesday. The theater chain Cineplex Odeon said it would go along with the proposal. Its half-price Tuesdays were successful in Canada, but few other major chains signed on, and the plan fizzled after just a few weeks.
The problem with the Universal plan, theater owners said, was that the Tuesday discounts would cannibalize the weekend box office, where as many as 75 percent of all tickets are sold. Given the choice between spending $6 on a Saturday or $3 on a Tuesday, patrons would keep it cheap.
More recently, movie producer Robert Cort suggested that movies carry different
admission prices depending on their pedigree. While a high-profile, big-budget work such as "Jurassic Park" might fetch $12, a cheap, unimaginative title such as "Son-in-Law" would carry a $6 price, Cort said.
"Consumers are quite comfortable paying differential prices in most areas of entertainment," he said. "Concert-goers pay more for U2 than for a new fringe band. A Matisse exhibition draws a premium over general exhibitions. The NBA playoffs command a higher price than regular-season games."
But owners of multiplex theaters were not excited about the potential for customers to buy tickets for a cheap film and then sneak into the most expensive release.
Movie producers were equally reluctant to consider Cort's proposal. Even the most fetid film is considered a classic by its makers. Who's to say that "Man Without a Face" should cost more than "Another Stakeout"? Furthermore, low-budget films such as "Joy Luck Club" often are superior to wildly expensive titles like "Last Action Hero".
With some films priced cheaper than others, movie-goers would come to the inescapable conclusion that the less-expensive release isn't any good.
"We all spend a lot of money trying to get people to perceive that movies are wellreviewed, that audiences like them and that they're exciting and wonderful — even when they're not," Pollock said.
Greg Rutkowski, whose AMC Theatres offer discounts to late afternoon and early evening showings, said the industry had
been feeling pressure not to raise prices anymore.
"I haven't seen any of the companies, large or small, raising prices," he said. "We have a problem with the economy, and we don't want to ruin the business by raising prices."
Since theaters usually make more than half of their profits at concession stands, they are reluctant to reduce the flow of traffic. And, while a lot of people complain about admission prices, just as many decry the cost of a popcorn and soda.
The nation's dollar houses are the fastest-growing segment in the exhibition business. Cinemark Theatres, a Dallas chain that runs both first-run and discount houses, has built some of the best dollar theaters around. They are clean and comfortable and have high-tech sound systems.
The only drawback to the discount houses is that they typically show films months after first-run houses and sometimes only weeks before their home video premiere.
The exhibitors said that if Hollywood was serious about holding down ticket prices, they needed to start leading by example.
When a theater shows a film, it pays a share of every admission back to the producing studio. The percentages, called terms, are determined on a film-by-film basis, and the trend is for the theaters to keep less and the studios more.
Indeed, one recent film had some of the highest terms around — Pollock's own "Jurassic Park."
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LIFESTYLE • K-you • October 11, 1993