What Hollywood and the Movie Theater Industry Need is a Good Kick in the . . .

by Davis Freeberg, staff writer

During my life I’ve spent about four years working in just about every capacity at three different movie theater chains. Recently reading about Hollywood’s losing streak at the box office I’ve been a little glib and pleased that they are starting to feel some indigestion from the digitization of our society. However, as a former front line veteran of the movie theater business, I have to admit that to see this slump continue would make me a little sad.

When you work at a movie theater you don’t really do it for the money you take the job more because you are drawn to the thrill of movies and entertainment. The pay is pretty lousy but the perk of free movie tickets is irresistible. During the period of my life that I worked for theaters I saw just about every major movie that came out.

Although I’ve certainly enjoyed many great films over the years I also saw plenty of lemons during my four year stint in the theater trenches truly horrible pictures like Mr. Nanny, McHale’s Navy & Gold Diggers (which coincidently in my opinion is the worst movie ever made). Those four years of my life were fantastic, because even bad movies aren’t that bad when they are on the big screen and you don’t feel like you’ve paid for it.

It’s easy and convenient to blame the recent box office slump on piracy and home theater systems because they are definitely having an impact on consumer behavior — but the theater industry needs to realize is that there is another cultural shift going on as well. Consumers are choosing to lease their entertainment over buying it.

Companies like Netflix, Gamefly, Napster & Comcast all make it possible to subscribe for a fee instead of buy or pay per use. By charging per month, these services bring in substantially more revenue than businesses that charge per use. This revenue, by the way, is the magical reoccurring revenue that every business so covets.

My name is Davis, I am a TV addict. While some people are proponents of the ala carte pay per use pricing menus for their entertainment, if I was forced to pay for every show I watch on TV, I would either watch a lot less TV or pay a hell of a lot more. Some people like to go outside and play in the sunshine. I do not. At present by paying cable “only” $39.99 (plus $10 in taxes that they really should pay for) per month I am the equivalent of the super fat man who spends every day gorging himself at the smorgasbord.

So this brings me to my point. Why not offer a monthly subscription fee to your local movie theater chains. Consumers would be happy to spend $30 or $40 per month in order to have the privilege of seeing films the way I did when I worked for the theaters. Instead of collecting $40 per year from me now, theaters could instead bring in $480 each year with an all you can eat model.

Having worked on the books of several theater chains, I can tell you that it’s not about Box Office receipts. Hollywood eats most of that up. It’s about the popcorn. The margins are ridiculous. It’s not butter flavoring, it’s liquid gold. The increased traffic would create a boom in concession sales and this type of program would draw moviegoers out on weeknights, which is an especially dead period for the theater industry. If Hollywood was serious about backing this type of initiative, they could even allow for normal TV to be broadcast on Digital Projectors during the weeknights. How about Alias on the IMAX or an audience version of Survivor to go along with the real show?

Of course the problem with this business model is that it would require Hollywood to be innovative and for the studios to all get along. It blows my mind that the MPAA can get substantial backing for their piracy crackdown efforts but Hollywood still refuses to provide a digital solution or even agree on which DVD format to rip their customers off with.

Hollywood has missed the leap to the 21st Century. I have no doubt that Hollywood will survive this digital transition stronger then ever because I truly believe that content is king — but they should really try to come up with something more creative then their most recent desperate gimicky efforts.