The Foreboding Future of Theaters

Have you ever heard of Blockbuster? No not the classification of movies that release on opening weekend to enormous box office numbers, rather, the company. If you haven't heard of it, I don't blame you. Rest assured, there is a solid reason why.

Blockbuster was an enormously successful video-rental service in the 90's that owned over 9,000 stores across the US and had 65 million registered customers at its peak (Ash). The company's success is what inspired Netflix, which I'm positive everyone who's reading this has at least heard of. As you could imagine, the reason we all know about Netflix and not about Blockbuster, is because in 2010, Blockbuster filed for bankruptcy with nearly $1 billion in debt (Ash). Netflix brought about the downfall of Blockbuster because it was an innovator in the digital marketspace, offering a large selection of films online for a monthly fee. After Netflix hit the scene, the way we consumed film changed forever. Now, we are in the midst of another massive change in the film industry: The slow death of movie theaters. In 2021, a record 61% of Americans did not view a single film at any movie theater (Brenan). If Blockbuster is anything to go by, the culprit of this shift shouldn't be surprising.

Like I said, Netflix is a trend setter. The company is essentially for creating the streaming service industry itself. As such, dozens of companies have created their own streaming platforms to reap the benefits of the model Netflix popularized. Hulu, Amazon Prime, Peacock, the list goes on. All of these streaming services act as a hub for third party content: Movies and television programs that they do not own the intellectual property rights to. In this way, they are very similar to movie theaters. Both these streaming platforms and movie theaters are distributers that cycle through different films that are able to be shown at different times. The difference between the two come from how theaters are akin to a traditional marketplace, while streaming services are the digital marketspace alternative. As such, streaming services offer convenience, customization, and control those theaters simply cannot offer. Netflix, for example, can be watched on any device as long as you are connected to the internet, has a custom "recommended for you" list on the front page of your account, and its algorithm learns what types of film you enjoy and provide a match percentage for every film you come across.

All of these benefits contribute to streaming services rising domination over theaters, but still, we're ignoring a certain elephant in the room. The Covid-19 pandemic drove people away from theaters because few people would want to risk getting infected in an indoor room with hundreds of people breathing all over the place. So, we could just assume that the meteoric drop in theater attendance is all due to covid, right? Well, since covid kept everyone out of theaters, streaming services seriously took off. Not only did Netflix, Hulu, and all the trend setters see massive growth, new streaming services from film studios like Paramount and Disney exploded onto the scene. This is where the real trouble comes in for theaters. As distributers, theaters are completely reliant on these movie studios to supply a product; to give them the right to show their product on a big screen and receive some of the profits. Now that individual studios have their own streaming services, they have complete control over where their content is seen. Essentially, Covid-19 accelerated the decline of movie theaters that began with the conception of streaming services. This development begs the question: Would it simply be more profitable for these studios to stream all of their new films?

That's what we were all expecting. However, a certain film that released in 2021 has thrown a wrench into the theater vs streaming dilemma: Spiderman: No way Home. You may have noticed that I talk about Marvel movies a lot in these blogs and the reason is because they simply make the most money and have the most successful marketing strategy. When covid hit the world, a few Marvel movies were relegated to limited theater releases supported by Disney+ streaming sales. Black Widow only made $376 million in the box office, which is a far cry from the billions of dollars that other Marvel properties rake in. This result in the box office provided a solid argument that Marvel might as well just go straight to streaming, however, when Spiderman released at the end of 2021, things changed. People flocked to the theater. It was the highest grossing film of 2021 by far, making $1.89 billion during the pandemic! People wanted to go watch this film in the theater despite the health risks because of the massive event it was marketed to be. If anything, it shows that theaters aren't quite dead yet.

If anything, the continued development of streaming services poses a dramatic change to the way movie goers enjoy films. People are clearly willing to go to a theater for movies that demand an audience to witness a massive spectacle, like Spiderman. Because these movies are so prolific, I can't see theaters dying out completely anytime soon. What I can see, however, is a focus on releasing more movies on streaming services that do not demand large audiences. Think more dramatic films, like Marriage Story, that are presented as streaming originals and launched to critical acclaim. I believe that theaters will develop into something more akin to an amusement park for larger-than-life action movies, while streaming services will become the home for different genres that can be marketed Soley from word of mouth; from people saying, "you have to go watch this movie now." That's the beautiful thing about streaming and the digital marketspace in general, it makes watching anything anywhere at any time possible.

Works Cited

Ash, Andy. “The Rise and Fall of Blockbuster and How It's Surviving with Just One Store Left.”

Business Insider, Business Insider, 12 Aug. 2020, https://www.businessinsider.com/the-rise-and-fall-of-blockbuster-video-streaming-2020-1.

Brenan, Megan. “Movie Theater Attendance Far below Historical Norms.” Gallup.com, Gallup,

10 Jan. 2022, https://news.gallup.com/poll/388538/movie-theater-attendance-far- below-historical- norms.aspx#:~:text=Movie%20attendance%20was%20also%20down,in%20any%20other%20Gallup%20survey.