Rafa\’s Corner of Nonsense, Part Deux

… where Rafa\’s thoughts see the light of day…

Movie theaters: black hole of capitalism

My friend César had an interesting post regarding movie theater seating, which reminded me of another rant of my own (thanks, César!). 😀

I think the movie theater business is one where the laws of capitalism and supply and demand totally break down.

Think about it: every movie, regardless of how much it cost to make, regardless of who made it and how much (and how many) people want to watch it, costs exactly the same to watch at the same theater.

Let me put this another way: regardless of whether I am watching Star Wars: Heir to the Empire [not directed or touched in any way by George Lucas], Spy Kids 2: The Reckoning, Schindler’s List 2: Electric Boogaloo, or Harry Potter [insert number here], I’ll still shell out the same amount of money if I go see it at the same movie theater and at the same time of day.

Why is it that the only difference in movie ticket price is determined by the theater you go to, and the time of day (matinée or not)? Surely the investment of millions made in the creation of each movie and the amount of anticipation it creates in the viewers should be more important in price determination than whether the theater has new seats and doesn’t (yet) smell like stale popcorn.

The movie industry is the only one in which the quality (or perceived quality) of the product has no bearing on the cost to the consumer. While you may argue that a sucky play may be overpriced, and thus its price will not reflect its quality, plays are priced according to more natural capitalistic rules: tickets for Broadway plays with critical acclaim and well-known actors, for instance, will surely be more expensive than an unknown play at Coco’s Casa de Acting featuring the acting prowess of the best community college drama students.

So, faithful readers (yeah, both of you), what do you have to say on the matter?


November 24, 2005 - Posted by | Uncategorized

1 Comment »

  1. I am one of those two readers! I look for updates about once a month. After a few months with nothing new, I opted to stop. I was surprised to see an update now. Do you have other things to do other than sit around and update your blog all day?

    Box office financial structures are based on the amount of viewers you can attract. If a movie can attract a lot of viewers, it will generate greater revenues. A movie that costs more to make, due to top actors, better effects, a well-known director, usually attracts more viewers.

    The problem is that this is not a guarantee. Some big budget movies have flopped. And some low budget movies become a cult hit and generate a relatively large profit.

    This type of business plan creates profitable markets for movie critics and reviewers. There is a lot riding on a good review.

    The music industry is taking that approach too. Many online music shops charge a flat fee per song, no matter the artist or quality of the production. Also, the price of music CDs have been relatively the same, except maybe for new releases which go on sale initially.

    Similar to budget DVDs and CDs which are lower in price, there are also budget theatres for older releases.

    Hmmm… why am I writing so much on this topic. It is to make up for the lack of comments on your previous posts. I have other things to do than sit around commenting on your blog all day.–>

    Comment by Omar | January 9, 2006 | Reply

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