If Put In Other Industries, Many Hollywood Executives Would Be Fired

November 11, 2014 6:34 PM

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This summer's box office performance declined about 15 percent when compared to last summer. While some industry Pollyannas might claim that better days are ahead, long-term trends do not support the sunny disposition. Higher ticket prices, leading to sustained revenue, have glossed over the fact that attendance has been declining for years. Per capita movie attendance has dropped a whopping 21 percent from 2002 to 2013. Though studio executives can cite various reasons for the attendance decline such as a growing list of entertainment options/streams that consumers enjoy and the shortening of the release window from theater to other outlets, another reason for the decline is harder to swallow; too many films suck!

One analysis revealed that roughly five percent of films account for nearly all industry profits, reflecting a dismal hit rate of 1 in 20. Most executives in other industries would be fired for such a record. But not in Hollywood. Why?

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