Audiences are declining in Hungary’s exhibition industry, and multiplexes – a new phenomenon in this market – are being touted as the catalyst to turn business around. Budapest Film, the capital’s largest cinema landlord, is now investing an undisclosed amount of coin to renovate the Corvin theater into a six-screen, 1,500-seat multiplex. When completed in September 1996, the Corvin, Budapest’s biggest movie house, will be the country’s first Western-style multiplex.

Other multiplexes are expected to follow. According to industry insiders, these venues are viewed as the remedy for Hungary’s ailing distribution and exhibition markets.

“The exhibition industry here is in trouble,” says John Cassidy, director of foreign-language film operations for distrib-exhib Flamex.

“Twenty years ago in Canada and the U.S. the exhibition industry was also in trouble, and multiplexes saved it. Hungary is a little bit behind those countries. But the same thing will happen here.”

A retooling of Hungary’s exhibition infrastructure is around the corner, according to Gyorgy Mihaly, managing director of distributor InterCom, which handles Warners, Columbia/TriStar, Orion, Fox, Carolco and Disney releases.

“Once you see where the world is at, you’re going to get your act together,” says Mihaly. “If we still have shabby theaters in three or four years, the industry will disappear.”

Bringing multiplexes to Hungary will not be easy. Ticket prices will inevitably rise, and the nation’s economic woes – 23% annual inflation and regular currency devaluations – will make it tough for film fans.

“We feel people are spending less money on entertainment,” notes Peter Balint, managing director of UIP-DunaFilm, the distributor of Universal, Paramount and MGM films.

Video is also stealing audiences. But the exhibition industry contends multiplexes could win these viewers back. “People don’t go to the movies now because of the novelty of video,” says Cassidy. “But eventually video is going to level off and multiplexes will be able to grab this audience.”

Multiplexes will bring Hungary “shiny new theaters,” says Cassidy. Hungary’s baby-boomers will be willing and affluent enough to keep these venues in business, according to Mihaly.

But the quality of venues is not the only factor in this equation. “(Hungarian audiences) will only go to blockbusters today, not to mid-range pictures,” notes UIP’s Balint. Still, the Hungarian market has retained many of its idiosyncrasies.

One is an enthusiasm for art films – a fixture of the industry during the Communist era prior to 1989. As a result of this legacy, Hungary’s arthouse cinemas still enjoy a “very select audience” that is fiercely loyal, says Balint.

At any one time, films by Western auteurs like Hal Hartley, Peter Greenaway and the late John Cassavetes are playing to full-capacity crowds in Budapest theaters.

This is good news for indie distribs like Flamex, which has a slim but entrenched 12% share of the market. (Market leader InterCom boasts a 55% share, and UIP 33%.)

On the exhibition side, investment other than the Corvin project is expected soon. “I would say within the next six months something seriously is going to happen,” says Cassidy. “The only question is who is going to do it first.”

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