With 2017 officially in the books, lets take a look back at what turned out to be a very up and down year at the box office. As more and more people chose to stay in the comfort of their own homes and take advantage of the ever-increasing viewing options, studio’s and market researchers were left scratching their heads this year. Sure things weren’t so sure anymore and the rise of original/indie films were causing the predictability of the market to go askew.
Even with the average ticket price going up nearly 30 cents and more and more people choosing expensive formats such as IMAX, the overall box office was down from last year 2.5%. This is after two consecutive years of rising profits but hidden in there was the fact that actual ticket sales were down. In fact, it was the lowest amount of tickets sold since 1995 where the average cost of a movie ticket was $4.35. With VOD threatening to change the way folks purchase and enjoy films, the studios are now more than ever relying on the “tent poles” to carry the load.
The year got off to a promising start and was outpacing 2016 thanks to early hits such as The LEGO Batman Movie, Logan and The Fate of the Furious. Thanks the these successes the box office was heading into May up 5% compared to 2016. The Spring release Beauty and the Beast in particular would dominate both the North American ($503m) and International ($759m) box office all year long until the release of Star Wars: The Last Jedi in late December. Another lightning in a bottle was first time director Jordan Peele’s Get Out which came out of nowhere to earn $245 million on a miniscule $4.5 million budget. It yielded the highest ROI (630%), is one of the best reviewed films of the year and has figured heavily into the award season.
The summer season seemed poised to perform well with several huge titles being released in the form of historically friendly box office franchises. In the end titles like Guardians of the Galaxy Vol 2, Spider-Man: Homecoming and Despicable Me 3 while performing well internationally came in slightly under expectations here at home. One time guaranteed box office juggernauts such as Transformers, Pirates of the Caribbean and The Mummy all showed franchise fatigue and performed terribly in North America. That fatigue, which seemed to the topic of the summer, paved the way for massive success’ in original storytelling such as Baby Driver, Dunkirk and Girl’s Trip.
Even the record-breaking run of Patty Jenkin’s Wonder Woman, one of the year’s best success stories, couldn’t stop the bleeding as the damage was already done. By the summer’s end, the $3.77 billion in total earnings would be the lowest in 10 years and track over 15% lower than the same point last year in 2016.
Fall would bring some disappoints as well with highly anticipated titles such as Kingsman: The Golden Circle and Blade Runner 2049 both underperforming in a big way and losing money in the process. It wasn’t total loss however, as we saw the release of another surprise hit in the form of a remake of the Stephen King classic It. The R-rated horror film would go on to earn almost $700 million worldwide on a $35 million budget and break just about every record for an R-Rated horror film and fall release. Solely on the shoulders of It, the box office would head into the holidays up a whopping 11% compared to 2016, a great bounce back from a meek summer and early fall performance.
Coming off the huge success of It, analysts had high hopes going into November as there were still 3 massive titles to come before year’s end in Marvel’s Thor: Ragnarok, WB’s Justice League and Disney’s Star Wars: The Last Jedi. Marvel got the ball rolling with Thor which opened to a huge $122 million and kept going from there completely earning well above expectations. However Justice League would go on to be a very publicized disappointment critically and commercially, even losing money on what was once considered a sure thing to hit $1 billion. So with the release of Star Wars: The Last Jedi in mid December, even with all time historic numbers and a slight rise compared to this time last year, 2017 would end up falling just short of the previous two.
It’s hard to look at a year where $11.12 billion in earnings can be see as a bit of a let down, but the industry experts point to bigger problems on the horizon. Looking at trends and the widening gap between the tent-poles and the smaller budgeted indie films, studio’s are going to be less willing to fund anything other than comic books films and animated features. 2018 has some massive titles being released, so who knows, perhaps this time next year we’ll be talking about records profits once again. But the problem which will become obvious is that years with fewer number of superhero based releases will simply see a predictably smaller return with fewer options for consumers. All the while ticket prices will rise each year to cover any potential losses and the cost of inflation.
These are all for the most part North American problems, with figures that show a shift in the paradigm. Elsewhere around the world things are looking bright and in fact the $39.92 billion worldwide total is a new all time record and up 3% from 2016. The $28.8 billion international take represents 72% of the overall worldwide box office and there’s currently room to grow that number.
With China expanding more and more every year, Hollywood will have to decide where and how to invest their money going forward. There’s talk of massive expansion in 3rd and 4th tier markets in China that have zero cinemas built, so you literally have a population the size of the U.S. that doesn’t have access to a movie theater…yet.
As Netflix, Amazon and even Disney are looking to expand into the VOD market, this next year could be a strong indicator of how the future might look.
See you in 2018!