What They Say
Variety said that the global cinema industry is set to lose $32 billion in 2020 due to the COVID-19 pandemic, a 71.5% reduction in box office revenue compared to 2019, according to a recent report by media and tech research firm Omdia. Omdia’s “Movie Windows: Adapting for the future” report finds that box office revenue has dipped below $13 billion for the first time in more than 20 years.
Whilst box-office revenues have been hit, there’s been unprecedented growth in online video usage — both transactional and subscription — during 2020, the report finds. Online transactional and subscription video revenue is set to increase by 30% year-on-year from 2019’s $26 billion to $34 billion in 2020.
The report also states that premium VOD has accounted for only $630 million in revenues for studios in 2020.
What We Think
While some think that there will be flood back to cinemas once Covid is over, I tend to think that it will never be the same again. The home TV experience can now be phenomenal and while cinemas could compete by, for example, switching to LED displays, but that is going to take huge capital. The change to digital also took a lot of capital, but in that case, there were big savings in opex for distributors and studios, so they could help to finance the capex of theatres. That doesn’t apply to an LED change, sadly. (BR)
