When I started doing these Labor Day summer wrapups five years ago, what I identified — and what plenty of other people identified — was a crashing bubble at the domestic box office, and after a rebound year in 2018, it looks like that crash has finally happened.
Going back over the history of the overall box office, the total gross went on a steady upward boom in the ‘90s, with a solid streak of increased revenue running all the way from 1992 to 2004, followed by a few down years surrounding the 2008 economic collapse. This was buoyed by a massive increase in 2009 when Avatar reintroduced 3D movies, and though 3D has been steadily declining in popularity ever since — and was realistically never that popular to begin with outside of Avatar itself — theaters have seized on premium large format tickets being profitable, which has lead to IMAX and other chain-specific branded large format screens remaining part of the movie-going experience.
These days, you pay a little extra to see a movie on a much bigger screen with a nicer sound system, and you don’t have to put on those fucking glasses. It’s still for chumps, but it’s a material improvement in your experience, whereas 3D was effectively just repackaging a very common camera trick.
But things start to dip down again in 2014, and we see another down year in 2017. That represented a massive depression in actual attendance and was supposed to be the shape of things to come. That’s when Moviepass came to play.
Moviepass, a subscription service that subsidized the cost of movie tickets for subscribers, had been around in various forms since 2012 — what would eventually happen, with the company completely rearranging its service from year to year, is actually par for the Moviepass course if you go through the company’s entire history. In August 2017, the company was bought by analytics firm Helios and Matheson, which lowered the subscription price to $9.95 per month. For that price, which is around the price of an average movie ticket in most parts of the country, Moviepass would buy a single movie ticket per subscriber per day.
The deal was completely outrageous, and that was the intent. The model allowed customers to take the company for as much as $300 per month in free movie tickets, but that, roughly, was the plan. Sure there would be heavy users, but there would also be plenty of people who subscribed and forgot, it would be like a gym membership to them. If the model was at least kind of stable, Moviepass would enter a game of chicken with theater chains — if Moviepass was the only reason a large enough number of patrons got off their couches and to the theater, if Moviepass subscribers bought measurably more concessions with their savings, if the company got any degree of leverage, they’d use it to force chains to lower their ticket prices and start creeping toward profitability.
That’s not what happened.
The subscription service certainly made headlines with their $10 per month announcement, and certainly boomed — it went from 20,000 subscribers to 100,000 in just two days after the announcement. New accounts had to wait for weeks for their debit cards because Moviepass’ supplier literally didn’t have enough plastic ready to meet the demand. A massive secondary market emerged with subscribers re-selling their free tickets at a discount, and the company had to incorporate several usage-hindering measures to try and cut that down. Theaters, which were supposed to play into Moviepass’ hands, began to offer their own subscription services instead. By July 2018, they were out of money and suspending services, and accounts dwindled from a peak of 3 million to just over 225,000 today. A bombshell article from Business Insider a few weeks ago, which is well-worth the trouble of signing up for a trial account if you haven’t read it, details the process from the inside and casts doubt on the idea that there was ever any plan at all.
But even after collapsing halfway through the year, the 2018 box office rebounded in a way that no experts expected it to. While this was credited at the time to more diverse movies like Black Panther and Crazy Rich Asians, and they certainly proved there’s still room for movies to expand their market, the real answer was simple — the box office rebounded because Moviepass subsidized that rebound. Now that’s gone, and the 2019 box office has been steadily behind almost every weekend.
What’s thriving in this environment? Disney. Disney and its episodic products, things that I’m going to start calling monopoly-class movies.
The monopoly-class movie is not good, and when it is good, it is merely a coincidence. The monopoly-class movie is on-brand.
The monopoly-class movie’s function is not to tell a story — though again, most accomplish this in passing. The monopoly-class movie’s function is to guide excitement toward more media opportunities, be they future movies or brand-associated television series, or toward past media with newly relevant details, which are conveniently available at the touch of a button through the brand’s exclusive online streaming platform.
The monopoly-class movie costs a minimum of $100 million to make, usually closer to $200 million, but still has noticeably disappointing visual effects. If the monopoly-class movie fails at the box office, it will not matter, because it brings so many other revenue streams with it, and because the studio’s other monopoly-class movies will do well enough to make up for it.
The monopoly-class movie does not simply monopolize the box office, but the entire culture. Traditional blockbusters paved the way for this with intensive advertising and merchandise tie-ins, but those are different. Those remain purely commercial interactions that can be worthwhile on their own merit. The monopoly-class movie, through expos, conventions, large-scale schedule announcements and near-unlimited interview availability, gulling a click-driven news environment to cover it endlessly, becomes much more than a movie. It’s a pilgrimage. It’s a pillar of shared cultural experience. Where blockbusters and cult classics of yore proved themselves as such over decades of continued influence and revisitation, the monopoly-class movie is sold with this status pre-packaged.
The broad-ranging worlds of intellectual property on which monopoly-class movies are based were purchased by Disney over a six year period — Pixar, which was always associated with Disney but formed as an independent company, purchased for $7.4 billion worth of stock in 2006 after they could not otherwise come to a new distribution deal; Marvel Studios, the newly formed film division of the comic chain that had been near bankruptcy twice in the past 10 years, purchased for $4 billion in 2009; and Lucasfilm, purchased for $4 billion in 2012 because George Lucas didn’t feel like fiddling with it anymore.
The saying is the average American goes to see five movies per year, and they all see the same five movies. By 2012, Disney would own at least three of them.
Over the course of the ‘10s, live-action remakes of classic cartoons began making comparable amounts of money, adding to the library of media that can be upsized to monopoly-class. This year, Disney purchased 20th Century Fox’s television and film IP for $71.3 billion, diversifying its portfolio ever further. The recent dispute between Disney and Sony over the Spider-Man movies is exactly the kind of dispute that preceded Pixar’s eventual purchase, so don’t be surprised if Sony soon joins Fox as conquered lands.
This was widely forseen, but didn’t become readily apparent until 2015, when Disney’s Star Wars movies first started rolling. That year, the studio owned three of the top five and four of the top 10 domestic grossers. In 2016, it was four of the top five and six of the top 15. 2017, three of the top five and four of the top 10.
Last year, Disney owned the top three domestic movies, Black Panther, Avengers: Infinity War and Incredibles 2, but this was where the gap between winners and losers really started getting out of hand. Incredibles 2 earned $190.8 million more than the fourth-place Jurassic World: Fallen Kingdom — that difference is more than what the no. 15 Spider-Man: Into the Spider-Verse made total. The top trio made almost as much as the rest of the top 10 combined, which includes yet another Disney film in Ant-Man and the Wasp.
This year, the problem seems even bigger. There are six monopoly-class films at the top of the box office as of Sept. 4: Avengers: Endgame, The Lion King, Toy Story 4, Captain Marvel, Spider-Man: Far From Home — technically a Sony property, but sold and commonly understood as Disney’s nonetheless — and Aladdin. The no. 7 domestic grosser, Jordan Peele’s Us, earned less than half of what Aladdin made. These six films combine to make up almost 37% of the total domestic box office. The scary number everyone threw around was that if Disney bought Fox was that it would control 35% of the market, but more than that is tied up in these six films already. If you think it’ll look better after a competitive fall season, remember that two more monopoly-class movies, Frozen II and Star Wars: Rise of Skywalker, are lined up for Thanksgiving and Christmas.
Endgame, which eventually overtook Avatar as the highest grossing international movie ever, is an especially fascinating case study in how monopolized this system has become. Blockbuster season is traditionally measured as between Memorial and Labor Day weekends — Marvel has been pushing that earlier since its inception with the first Iron Man movie on May 2, 2008, and the first weekend in May has been a Marvel tradition ever since.
Endgame, like the vast majority of movies, made most of its money in the first few weeks, sitting at $771.3 million in domestic earnings going into Memorial Day weekend, its fifth weekend in release. If you measure just its earnings in that traditional window between Memorial and Labor Day — it was still in 110 theaters last weekend — it made almost $87 million within that timeframe. That sliver of its earnings, a little bit more than a 10th of its total domestic box office, would put it at no. 20 on the year. Only nine movies, four of which are among our big fish, made more than that during blockbuster season. Massive releases in Men in Black: International and Dark Phoenix made less than that during their entire runs.
The market was so devoid of excitement for films outside of this top handful that two of them were successfully recycled back into theaters. Endgame and Far From Home were each re-released with additional footage over Independence Day and Labor Day — along with indie horror film Midsommar — respectively, each bouncing back into the top 10.
So what does this mean for the future of theatergoing? Well, it looks like we’re going to have more access to fewer options.
Moviepass may look like it’s gone the way of the dodo, but more accurately, it’s gone the way of 3D. Just like theaters came up with their own branded large-format screenings that out-lived 3D, the subscription services they developed to counter Moviepass have quickly become a major part of their business model. AMC’s and Cinemark’s subscription packages are both approaching 1 million subscribers after roughly a year each in service, and they look to only increase as a share of the businesses as time goes on. The deals aren’t nearly as exploitable as Moviepass, but anyone who goes to a major chain more than three or four times a month would still be a fool not to have one.
As for the movies they’ll be seeing, well, I don’t know if I need to take you through everything that can go wrong when one company has too much control over a particular market, but here’s a whole video about it, specifically as it relates to Disney, Sony and Spider-Man-
The level of outcry against Sony for turning down a terrible, bad-faith deal is incredibly disturbing, as is the outright creepy enthusiasm with which some are awaiting the Disney+ streaming service.
Also disturbing is what’s happened to Fox’s existing catalogue after Disney acquired the studio. Despite having several films already prepared and ready to go, Disney has let its inherited Fox release schedule die on the vine, opting to wait until it can make them on-brand Disney movies from the ground up and, nonsensically, going out of the way to blame the movies for not marketing themselves.
Big studios have been funneling more and more money into fewer and fewer major releases for years. Now there’s one fewer studio, the studio that ate it doesn’t seem interested in picking up the slack, and fans seem to think that company can do no wrong.
Most experts saw doom in 2017. In the span of a year, Moviepass changed the industry forever and for good, but appears to have only delayed the inevitable. What will stave it off now?