If Hollywood executives are suffering crazy mood swings of late, there may be a simple explanation.
The movie culture arguably is at all-time peak power. Yes, more people were buying movie tickets in the late ’40s and early ’50s, but they weren’t also viewing films on videocassettes, DVDs and free, cable and pay-per-view television. And the international market was a fraction of what it is now.
Thanks to a late-year rally led by “Dr. Seuss’ How the Grinch Stole Christmas” and “Cast Away,” the 2000 North American box office set an all-time record of $7.7 billion, topping 1999 by almost 3 percent and continuing an upward trend that has lasted uninterrupted since the early 1990s.
The new year is off to an even stronger start; the Martin Luther King holiday weekend’s box office beat the corresponding 2000 weekend by 47 percent, with the $23.4 million earned by “Save the Last Dance” from Friday to Sunday becoming the highest-ever January opening weekend (topped only by the 1997 “Star Wars Special Edition” release).
What’s more, viewers are seeing movies on the best screens since the days of the old cinema palaces and with the best sound systems, sight lines and amenities ever.
And everything is falling apart.
Here are three reasons:
1. The theater business is doing its best impression of that FedEx plane in “Cast Away.”
Forget about those lines to get into “Traffic” or “Crouching Tiger, Hidden Dragon”; the nation’s theater chains are crashing. Regal Cinemas, the largest North American chain, is on the verge of bankruptcy, and other top chains filed for Chapter 11 protection last year, including Carmike Cinemas, United Artists Theatre Company, Edwards Cinemas, Landmark Theatres and General Cinema, the last two of which operate in the Chicago area.
Of greater local impact is the precarious status of the New York-based Loews Cineplex Entertainment, which has until Friday to work out an arrangement with its bank lenders or risk going under. The chain already has received two bank extensions in an effort to stave off bankruptcy.
Some distributors reported being told a couple of weeks ago that the chain plans to close all or part of 12 of its older, local theater complexes, a total of 65 screens, after today’s screenings, though at the time a Loews Cineplex spokeswoman denied that any decisions had been made. The theaters were said to be the 900 N. Michigan, the Commons of Chicago Ridge, Ridge in Arlington Heights, Stratford Square in Bloomingdale, Bloomingdale Court in Bloomingdale, River Oaks 1-6 in Calumet City, Grove in Downers Grove, Orland Square in Orland Park, Rivertree Court in Vernon Hills, Rice Lake in Wheaton, the Oakbrook 1-4 and West Ridge Court in Naperville. At press time the closings remained unconfirmed.
We’ll know soon enough what the chain’s survival strategy is; possibilities are said to include the company bankrupting one of its subsidiaries, perhaps the Plitt Theatres that Cineplex Odeon bought here and elsewhere in the 1980s.
The Chicago area has never seen the simultaneous closure of that many screens, but if Loews Cineplex can get away with shutting down only those older multiplexes, the company likely will be better off: A key reason the chains have struggled is they built so many improved facilities that the outdated ones — which generally have fewer screens and no stadium seating — quickly became unprofitable, and the companies couldn’t get out of their leases fast enough.
Before we move on to the next plague on Hollywood’s house, let’s take a moment to savor the glorious results of that Loews-Cineplex Odeon merger of 1997. The combination of those two bigwig chains, which were operating the bulk of our local theaters, was supposed to create glorious synergy for someone somewhere.
But first the U.S. Justice Department forced the freshly merged company to divest itself of some theaters to avoid near-monopoly conditions, so the Water Tower, Biograph, Broadway, Bricktown Square and three other aged complexes were spun off to the new, locally based Meridian Entertainment. Some of those theaters went belly-up last year, then all of Meridian did. Bye bye, movie houses.
And now the debt-ridden Goliath of Loews Cineplex is trying not to bleed to death. The benefit for moviegoers is . . . ? Yes? Speak up, please.
2. The doomsday clock is ticking with no heroes in sight.
Hollywood is sounding positively apocalyptic about the looming possibility of writers’ and actors’ strikes, which could shut down film and television production indefinitely. The Writers Guild of America’s contract with the Alliance of Motion Picture and Television Producers (a group that includes the studios) is up May 1, and the Screen Actors Guild’s deal expires June 30, and in neither case do the two sides seem close to an agreement.
Most of the squabbles involve money as allocated in various complicated formulas, such as the residuals paid when movies and shows are shown on free and cable TV, video-on-demand, DVDs, the Internet and foreign markets.
The Writers Guild is up to bat first, with an intensive two-weeks-only negotiation session scheduled to begin Monday, and the studio and network executives already are taking a hard line. They claim the Writers Guild’s proposals — and the domino effect they would have on other guilds — would cost the industry up to $2.4 billion. The writers estimate the three-year contract’s price tag to be $161.1 million.
The guilds aren’t even presenting a unified front. Little love is lost between the Directors Guild of America, whose contract expires next year, and the Writers Guild, which is seeking to ban directors from taking possessory credits (“a film by”). The DGA is challenging many of the Writers Guild’s creative-rights proposals, such as those guaranteeing a writer’s participation in the casting, promotion and on-the-set production of a film.
Meanwhile, the studios are amassing their version of a war chest by rushing as many movies into production as possible so they’re completed before the actors’ potential walk-out. The upcoming fall’s TV schedule will more likely suffer from a walkout than the 2001 film slate, but if the thought occurred to you that rushed movies aren’t necessarily good movies, you’re not alone.
3. The future has Hollywood just plumb baffled.
A year ago Hollywood was bullish on the Internet, and money was flooding into various Web sites, most of which focused on animated shorts. Since then some have gone bust (most spectacularly, the Steven Spielberg/David Geffen-backed Pop.com, which never got off the ground), others have had to abandon their original strategies (iFilm) and none has come up with a surefire scheme for making money.
Back in the theaters, there’s an industry consensus that movies of the not-too-distant future will be presented digitally: Out go celluloid and film projectors; in come a super-refined form of digital video that is transmitted to theaters from satellites.
Not only is video cheaper to use than film, but the studios stand to save billions of dollars when they no longer have to strike 5,000 prints for each wide release and ship them to every theater. Then again, the cost of retrofitting all 37,000 or so North American movie screens with digital projection systems also will cost billions.
Take a wild guess who the studios want to pay for the new equipment?
The theaters.
If any of them are left.
At least the entertainment business is entertaining. Enjoy the show.
