A BAD SIGN FOR by Isaac Greenwood Amidst high-profile scandals and executive shake-ups, the traditional film landscape has changed drastically over the past five years. In a whirl of prequels, sequels, remakes, and spin-offs, box office flops are increasingly prevalent as evidenced by failures this summer such as The Great Wall, Ghost in the Shell, and King Arthur: Legend of the Sword, which all featured ensemble casts and big budgets. Annual movie theater attendance, as measured in billions of tickets sold, has decreased by over 200 million to 1.296 billion since 2007 as inflation-adjusted box office revenues continue to fall. A multitude of factors contribute to the slow demise of the once-dominant movie studio industry. With the rise in popularity of independent film, traditional studios have faced increased competition; 78 Oscar nominations for 2017 were produced outside of the six major studios, up from 58 in 2015. Furthermore, large movie studios face pressure from providers like Netflix and Amazon who produce viable content across the globe. Beginning with series like House of Cards and Orange is the New Black in 2013, Netflix moved into the movie sphere in 2015 with Beasts of No Nation and has since produced dozens of award-winning films, notably from the British Academy of Film and Television Arts. The company recently announced it would release over 80 new movies next year and license its original content for sweaters, shirts, and similar. These services offer competitive salaries to notable actors and directors like Robert Redford and Eli Craig, who help attract audiences with ease of access anywhere in the world. As part of the traditional complementary set to film, movie theaters have also been forced to adapt to changing consumer preferences. Small chains and large chains alike now offer incentives like $5 Tuesdays, frequent visitor perks, and luxury seating. Founded in 2011, MoviePass offers patrons unlimited screenings at participating locations for just $9.95 a month. Outside of markets like New York City and Ithaca that enjoy increased ticket pricing, the former due to high demand and the latter low supply, subscriber growth in the company has surpassed analyst expectations and sits at over 600,000 today and is expected to grow to an estimated 2.5 million by August 2018. Similarly, studios like Warner Brothers and 21st Century Fox are reportedly looking to offer in-home rentals for recent releases within 15 to 45 days after debut. However, these programs fail to address the fundamental problem gnawing at the industry
which has compounded its losses to digital competition: poor films. The widespread failure of films this past summer, traditionally one of the strongest seasons for new releases, demonstrates the riskiness of big-budget films against digital competitors with lower costs and easier methods of distribution. Seeking to create fan bases similar to those of Star Wars and Marvel, studios have increasingly turned to “tent pole” films with costs ranging from $120 to $150 million that are intended to launch multi-movie franchises. While just 10 years ago such films cost an average of $80 million to produce and market, these films now account for an overwhelming amount of studios’ profits who continue to rely on them despite high costs which have incurred significant losses. Like The Mummy, however, many tent pole films have bombed in the box office despite carrying names like Tom Cruise and Russell Crowe, with critics noting the film’s “dreary actionblockbuster template” and “considerable lapses in narrative” in what was intended to launch Universal’s Monster Universe. The recent Pirates of the Caribbean release is another example of a poorly-written film which failed to even revive a once-popular series. The success of films like Get Out demonstrates that studios should focus on socially relevant films with original content rather than rely on the boom-bust franchise model. Moonlight, which won the Oscar for Best Picture in 2017, demonstrates shifting consumer preferences toward films which capture America’s changing social landscape. Even here there have been missteps; the expensive and critically-acclaimed Blade Runner 2049 missed box office expectations by $15-20 million, largely given the failure to successfully market the film to female and younger audiences. Within the on-demand sphere, even giants like Netflix are subject to intense competition from the growing number of entrants like Apple, who joined the fray earlier this year and is expected to release over 10 original shows in 2018 on its Apple Music platform. Netflix recently announced a $1 increase in monthly subscription fees for new and existing customers alike, signaling the growing marketing and production costs the company must incur to remain relevant. The company is no stranger to price hikes, having introduced the first in 2014 and an additional one in 2016 with the removal of “grandfathered” plans for original subscribers. In a recent survey, 79 percent of millennials
chose Netflix as the provider of the best original content, and, coupled with continued growth in international markets, these hikes are expected to continue into the future alongside the company’s growing market share. To survive, Hollywood must address rampant racial and gender problems which have plagued studios for decades. The downfall and ousting of Harvey Weinstein, reported to have sexually assaulted dozens of women during his tenures at Miramax and the Weinstein Company, is likely the first of a cascade of increasingly public cases. Netflix even postponed final season filming for its hit House of Cards in wake of recent sexual assault accusations against Kevin Spacey, demonstrative of the rippling effects these scandals can have for both traditional and digital studios. However, many of these accusations have been known within the industry for years, but instead of blacklisting accusers as was done to Courtney Love in 2005, public sentiment and Hollywood machinations now appear to encourage the truth. Thus, studios and executives aware of these issues must address them on a preemptive rather than reactive basis. Diversity issues too must be addressed. Films should cast actors to reflect the rapidly changing American demography rather than continue to “white wash” characters and perpetuate Western stereotypes. Finally, while Chinese investments and partnerships in Hollywood have grown considerably over the last decade, studios should stay wary of the influence of the Chinese Communist Party. Chinese investment in Hollywood, both through studios and theaters, reached several billion dollars in 2016 but has slowed significantly since August as a result of Chinese regulatory scrutiny on such deals. Hollywood should not reduce or filter the quality of their content to attract such investments especially given the recent slowdown in large deals which provided much-need funding in the past five years. Although unprecedented, a Netflixor Amazon-produced movie may one day snag an Oscar while studios continue their slow and painful projected demise. While diverse and complex, the threats Hollywood faces are nonetheless solvable. Rather than purge executives for box office flops, studios should cut ties with known sex offenders and release films outside of the traditional action box office hit, as well as explore pricing and viewing methods to challenge on-demand competition.