Hollywood Rebounds at the Box Office

Projections show that about 1.36 billion people will see films this year, compared with 1.29 billion in 2011. Ticket revenue at North American theaters is projected to jump by 6 percent, to $10.8 billion, according to Paul Dergarabedian, a box-office analyst for Hollywood.com. What really matters, however, is that Hollywood achieved the increase without raising prices.

The anticipated lift in attendance, which factors in crowds for two big movies that are to open on Christmas Day, “Django Unchained” and “Les Misérables,” would be the industry’s biggest yearly increase since 2002. Lately, studios and publicly traded theater chains like Regal Entertainment suffered drops in annual attendance, forcing them to prop up revenue by charging more for admission and concessions.

“I really believe that momentum from weekend to weekend is crucial — that was fun, let’s come back — and we had sustained periods of that this year,” said Greg Foster, chairman of Imax Filmed Entertainment. Imax’s domestic ticket revenue will end the year up 50 percent, he said, the result of popular movies and an increasing reliance on Imax by studios as a way to differentiate releases.

Hollywood’s upswing is particularly notable because it comes despite a poor summer season, a period from the first full weekend in May to Labor Day when studios typically record 40 percent of their annual revenue. Summer ticket revenue dropped 3 percent and attendance hit a 19-year low. The July theater shootings in a Colorado theater kept some people home, but a lot of films were simply mediocre.

Why did Adam Shankman’s adaptation of “Rock of Ages” sputter? “It was a bad movie,” David Geffen said at an industry gathering in July. “And it’s unusual when a bad movie succeeds.”

Still, how Americans respond to movies became less important to studios in 2012. Look no further than “Ice Age: Continental Drift,” from 20th Century Fox, to understand why. North American ticket sales for “Continental Drift,” the fourth installment in the animated series, totaled $161 million, a 24 percent decline from “Ice Age: Dawn of the Dinosaurs” in 2009, after adjusting for inflation.

Then why is Fox thrilled with its performance and developing ideas for a fifth chapter? Because “Continental Drift” took in $714 million overseas, including $68 million in China alone. “This is a turning-point year for the relationship between China and Hollywood,” said Phil Contrino, editor of Boxoffice.com. “It’s becoming very clear how important China is to the worldwide gross of a film.”

Movies are a cyclical business in which a couple of hits (or misses) can whipsaw results. To that end, analysts emphasize that 2012 benefited greatly from just two films: “The Hunger Games” in March and “Skyfall” in November.

Backed by an effective social media marketing campaign, Lionsgate’s “Hunger Games” blew past robust expectations to become the No. 3 movie of the year, taking in about $408 million domestically, and producing a global total of $686.5 million.

(“The Avengers,” from Disney’s Marvel Studios, was by far the No. 1 movie, taking in $623.4 million in North America, for a global total of $1.51 billion — while “The Dark Knight Rises,” from Warner Brothers, was second, taking in $448.1 million, for a global total of $1.08 billion.)

“Skyfall,” from Sony and Metro-Goldwyn-Mayer, demonstrated how an aging franchise can be reinvigorated if new installments are actually worth seeing. “Skyfall,” which earned glowing reviews, has so far taken in $280 million in North America and $694.3 million overseas, making it one of the best-performing James Bond movies on record, even when adjusting for inflation.

It was a particularly lucrative year for Lions Gate Entertainment, which includes both the Lionsgate and Summit banners. Along with “The Hunger Games,” the company had “The Twilight Saga: Breaking Dawn — Part 2,” which has so far generated $783 million in global ticket sales. According to Rentrak, a company that tracks box office data, Lions Gate, a small movie company that leapt forward with its acquisition of Summit Entertainment, will end the year as North America’s fifth-largest distributor as measured by ticket sales, surpassing 20th Century Fox and Paramount.

MGM roared back to life after years of fiscal turmoil, including bankruptcy. Aside from “Skyfall,” MGM benefited from “The Hobbit: An Unexpected Journey,” a coproduction with Warner’s New Line Cinema unit that was No. 1 over the weekend, taking in an estimated $36.7 million, for a new domestic total of $149.9 million, according to Hollywood.com.

But most movie companies had a mixed year.

In a display of marketing strength, nine of Sony’s movies were No. 1 at the box office. Sony also successfully reintroduced its most important franchise with “The Amazing Spider-Man,” taking in $752.2 million worldwide. Still, high costs for movies like “Men in Black III” and flops like “Total Recall” ate into profitability.

Disney found a blockbuster new franchise with “The Avengers,” but also took a $200 million write-down for the big-budget science-fiction epic “John Carter.”

Similarly, Universal Pictures had steep losses from its costly “Battleship” but found new franchises in the raunchy “Ted,” which sold $502 million in tickets worldwide, and “Snow White and the Huntsman,” which took in nearly $400 million.

Article source: http://www.nytimes.com/2012/12/24/business/media/hollywood-rebounds-at-the-box-office.html?partner=rss&emc=rss