Flatline – Why is the box office down compared to last year? David July 3, 2014 Columns, Critical Information, Featured, Film In most cases .9 percent doesn’t equal a whole lot. Out of a one thousand dollar loan, you’ve lost nine cents. Out of a one hundred thousand dollar home loan, it’s going to cost you 90 dollars. Ninety dollars can’t even buy a great steak dinner on either coast if you decide to take a date nowadays. So why would .9 percent be so alarming in the box office? In an industry measured by tens of billions of dollars, .9 percent is the decrease in growth in the box office compared to last year, which, ironically, was less than the year before that. Two years is a fad, three years is a trend. What do we make about this, when the industry considered one of the most robust in the world, continues to dwindle stateside? While this trend is alarming, it’s not the only way a movie makes money. We aren’t looking at product placement, TV deals, merchandise, DVD sales, tax incentives or other revenue streams. Movies continue to be mini titans of industry, being able to show a profit faster than almost any other business. However, when .9 percent of people refuse to continue to engage in the socially acceptable and ingrained practice of watching movies, this becomes an issue worth monitoring. That’s .9 percent less, at a minimum, of profits across the board, assuming it doesn’t cut into it even further. The box office is a good indicator of how much money your movie will make. When the box office continues to shrink, there’s less wiggle room for your movie, smaller projects lose money, and fewer projects get made. The market shrinks more, and continues in a cruel cycle until the industry changes enough or technology changes to reverse the trend upward. Summer is the most profitable time for studios. Tentpole movies make more than the other three-quarters of the year combined. As much as Hollywood likes to brag about its awards seasons, the summer movie season is when the industry likes to flex its muscle. There’s not much to flex so far. Transformers is the first movie to barely cross 100 million dollars in a weekend. People are still flocking to remakes and sequels, but the numbers, overall, continue downward. One of the reasons is that there is not enough diversity in theatres. While that can refer to gender and race, here it refers more to the type of genre and movie being released: the same movies fight over the same audiences. Your parents don’t necessarily want to see Guardians of the Galaxy. If there isn’t a movie they want to watch during that time period, they will stay home. A lack of viable and attractive options keep audiences home. While everyone brags about the home runs, a steady stream of doubles is far more profitable. Another reason is the sheer number of other options. In terms of entertainment, you can watch anything from baseball to world cup soccer; attend a concert series to watching summer television; watch a movie you want on BluRay or a streaming service; or even go to the park, go to the beach, go out with friends, and so forth. These things always exist, but when there aren’t enough movies people want to see, buzz-worthy event movies, people delay seeing a movie. They delay enough to wait for the video release, and the market continues to dissipate. The only thing that can fix this is better products, and better advertising. Movie financing is becoming a micro niche business and every dollar counts. It’s up to Hollywood to determine whether to continue to stick their head in the sand or not. Needless to say, .9 percent means enough in the right context.