The closing of movie theaters has been a major blow to the industry. That's not exactly news. It was obvious that movie theaters, studios, and everything in between was going to be hurt by the need for non-essential businesses to close and the need for social distancing, but now we're getting a real estimate of just how big the hit is going to be. Get ready for a domestic box office that's less than $7 billion, compared to the $11.4 billion we saw in 2019.
That's a 40% drop year-over-year, and that is pretty close to a best case scenario. That assumes that the schedule reshuffling that we've seen, that mostly pushes the summer movie season back from starting in May to getting underway in mid-July, doesn't need to be reshuffled again, and that movie theater attendance is something resembling normal as soon as people are able to return to theaters again. Obviously, if things get delayed even further, or if people don't return when theaters open, that's only going to mean a bigger hit to the box office bottom line.
A domestic box office of $7 billion would be the lowest we've seen this century. The last year the box office didn't break $7 billion was 1998.
The numbers come from Gower Street Analytics (via THR) and they estimate that the domestic box office will hit $6.82 billion if theaters remain closed for three months, which would see them opening in mid to late June. If people are gun shy about returning to theaters and attendance ramps up more slowly, the number could be more like $6.36 billion. If theaters open after two months, the box office could break $7 billion, but just barely.
And this is just the domestic box office. While there are now estimates of what the global box office could look like this year, if a similar drop is seen around the world, we could see a global number of $25 billion or less, down from $42 billion in 2019.
Of course, these are all estimates because there's no precedent for something like this, nobody really knows what's going to happen. There seems to be a general feeling that people will want to return to theaters once we're given the all-clear. There will be a desire to return to those things that were part of normal life in the recovery
We also don't want to see another round of closures, so seeing businesses like cinemas ramp up slowly seems more likely. We could see theaters open up using policies that were being implemented prior to their closures, like only half the seats being sold, in order to keep distance between people. That will keep the box office from doing the business that might be possible, but it could still be the best choice in the long run.
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