High movie ticket and concession prices are causing 40% of seniors to stay home. Fewer ticket sales cause panic for movie executives, who earn most profits from sales. Families can save money by having movie nights at home with DVD rentals and supermarket snacks. Studios make most of their revenue from ticket sales in the first week of a film’s release. The cost of movie tickets is too high for many people, and it’s unlikely that prices will be lowered.
Rising costs of movie tickets and concession items are causing many to stay home rather than go to the movies. A survey conducted by the American Association of Retired People shows that 40% of seniors no longer go to movies because they can no longer afford the prices. When fewer tickets are sold, it tends to cause some panic for movie executives, who earn most of the profits from their sales. Fewer people going to the cinema and increased expense of making films both contribute to higher admission prices.
The average price for a movie ticket in 2012 is $8.12 US Dollars (USD). Popcorn is about $6 USD and a drink about $4 USD. Thus, the average spend in a theater is nearly $20 USD. For a family of four, that’s close to $80 USD for two hours of entertainment.
Consumers can purchase a DVD player for around $40 USD or less and a DVD rental for as little as $1.50 USD. Popcorn and soda for a family costs about $10 USD when bought at a supermarket or convenience store. That’s $54 USD for a family movie night at home, plus there’s no charge for gas or parking. Since the family now owns the DVD player, their next movie night could cost around $14 USD. Prices for Blu-ray players have also dropped, to under $100 USD for some models.
The expense of concession stands has a lot to do with how movie studios are reimbursed by local movie theaters. In the first week of a film’s release, the studio can make up to 90% of its revenue from movie ticket sales. So while admission is high, it doesn’t benefit the theater hugely. Each successive week, the film brings more revenue to the theater, so when a consumer goes to see a film on a second run, he usually gives more money to the theater and less to the studio.
Many people wonder if the studios should charge that much. Some of the best movies are made on fairly low budgets, and not all big-budget movies are big blockbusters. Generally, a studio makes up for its losses on big-budget films by earning higher-than-expected returns on lower-budget films.
Although actors earn a lot, they are not the only reason for the high cost of movie tickets. Moviegoers who take the time to read the credits of a film will see the sheer number of people employed by major productions, from gaffers, to cinema assistants, animators, casting assistants, artists or set designers. Many of these people work in unions that set specific prices for the work they do. This means that budgets for films that require large numbers of employees will usually be very expensive.
That doesn’t mean, of course, that the studios don’t make a profit, and the bigger studios make a lot of money. As people see fewer movies in theaters, however, ticket prices often reflect the increased bets studios take when producing a big-budget film.
However, many people in the United States simply cannot keep up with movie ticket prices. A 16-year-old earning minimum wage has to work nearly four hours to afford to see a movie and buy something at the concession stand. A poorer family’s admission to a film could be 16% of that family’s weekly income. For an increasing number of people, the cost of viewing a movie in a theater is too high to pay for the entertainment, especially when the movie rental is significantly cheaper.
It’s a matter of speculation that theater owners and studios will notice and lower their prices, but most experts believe that’s unlikely. Most people now deliberately budget and stick to matinee performances or go on “cheap nights”. Popular movies aren’t usually included on these discount nights, unless they haven’t been on the air for several months.
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