Movie Theaters Losing More Ground to In-Home Entertainment

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Global moviegoers spent $40.6 billion on theater tickets in 2017, up 13% year over year. North American (United States and Canada) box office sales fell 2% to $11.1 billion and international sales rose 18% to $29.5 billion. On the basis of number of tickets sold, U.S. sales were down 6%.

The big news, however, is that more money is being spent globally on in-home entertainment than on going out to the movies, and the lion’s share of that spending is going to digital options like streaming.

Global spending on in-home entertainment rose by 11% to $47.8 billion, including $13.7 billion in digital sales in the United States, up 20% year over year and $18.5 billion internationally, up 41% year over year.

The data were reported by the Motion Picture Association of America (MPAA) in its 2017 THEME (Theatrical and Home Entertainment Market Environment) report.

The primary growth driver for theater ticket sales in the Asia/Pacific region was China, where box office sales rose 21% year over year in 2017 to $7.9 billion. Including China, four of the top five movie markets are all included in the Asia/Pacific region: Japan ranked second with $2 billion in ticket sales and three countries — India, the United Kingdom and South Korea — tied for third with $1.6 billion in box office receipts.

Digital sales include electronic sell-through (EST), video-on-demand (VOD) and subscription streaming by paid subscribers.

Spending on physical products for in-home entertainment (DVDs) fell 15% in the United States and 16% internationally to $6.83 billion and $8.85 billion, respectively. Digital sales overtook physical sales in 2016.

As a percentage of global theatrical and home entertainment consumer spending, theatrical sales accounted for 46% of all sales, digital home entertainment accounted for 36% and physical home entertainment accounted for 18%.

Globally subscriptions to online video services rose by 33% to 446.8 million. Cable TV subscriptions dipped for the second consecutive year, although cable continues to be the revenue leader with $108 billion last year.

The full MPAA report is available at the group’s website.