The Theater Industry's Next Crisis: Too Many Seats, Not Enough Movies

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The movie theater industry has seen a lot of change over the last two years. A new crisis is taking shape as theaters face a lack of blockbusters after a promising summer.

Industry watchers are wondering if there is too many movie screens in the United States.

Cineworld, the world's second- largest exhibitor, recently filed for bankruptcy and said it would implement a real estate strategy in the US that could mean theater closings.

The number of screens in the US has not changed since the last pre-pandemic year.

The analysts at Moffet Nathanson think the industry needs to be trimmed back. The analysts said in a note to clients that they expected a drop in US screens as the business normalized.

The number of screens isn't the problem according to some in the theater industry. The number of seats is a better metric than the number of seats because of the current environment.

Patrick Corcoran, spokesman for the National Association of Theatre Owners, told Insider that "if we have too many screens, you have to specify." We don't sell screens.

The seat count has been greatly reduced over the last ten years.

Butts in seats

The data shows a more complete picture of the situation. Steve Buck, strategy chief at the data company that tracks theater attendance, said that 17.4% of seats were sold from Memorial Day through the end of July in the US.

There are lots of empty seats. Buck said that the figure includes everything from sold-out shows to a Tuesday afternoon for a movie.

The average number of seats per screen in the US is around 150. It may be too high with so few blockbusters being released. There are two more hits this year, "Black Panther" and "Avatar: The Way of Water".

The role of Queen Ramonda was played byAngela Bassett in Black Panther. The studios of marvels

The box office was affected by the lack of big-tent movies. Demand is at pre-pandemic levels but supply is not. There aren't enough new movies to see.

Theater chains might take the time to change their auditoriums by cutting the number of seats.

" Going leaner and meaner is an advantage for theaters in this marketplace given the recalibration of the industry," said Paul Dergarabedian, the Com Score senior media analyst. It's not a model for success to have too many seats chasing fewer people. It's a good idea to fill theaters close to capacity if the seats are high-end.

Chris Johnson, CEO of Illinois-based Classic Cinemas, said that reclining seats has a positive impact on attendance and called it a "game-changing" change.

John Fithian, the head of the National Association of Theatre Owners, recently told Insider that he doesn't expect movie supply to get back to pre-pandemic levels for another year or two.

Warner Bros., with its new parent company, has recommited to exclusive theatrical releases as opposed to dripping things out on streaming services. This week, Paramount stated that it wants to increase its theatrical output.

The theater industry has a long way to go to recover. What are you going to do next?

Now showing

Cineworld will likely close some theaters in the US. The theater industry likes to find treasures from trash. The Phoenix Theatres is a business that takes over shuttered cinemas.

Reclining seats and fewer seats are likely to be included in the renovations of some of these theaters.

The industry was able to get 8 million people to go to the movies for the first National Cinema Day. Thousands of theaters across the US offered tickets at no more than $3 for all movies and shows, which resulted in around $24 million in box-office sales that day, an increase of 9% from the previous Saturday's take.

Audiences can be persuaded to come out for special promotions even if they don't have a lot of money to spend on a movie.

National Cinema Day is not a money maker. If the theater industry does not believe in cutting screens then filling seats will have to be a priority.