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Global Box Office Hits Record $40.6 Billion in 2017; U.S. Attendance Lowest in 23 Years

The global box office hit a record $40.6 billion with growth in China off-setting declines in movie-going in the U.S. and Canada. The domestic box office fell 2% to $11.1 billion, down from 2016’s record high of $11.6 billion, according to a new report by the Motion Picture Association of America.

Higher ticket prices helped cushion declines in the U.S. attendance. Stateside admissions, the industry term for the number of tickets sold, dropped 6% to 1.24 billion — a steeper fall than the drop in revenues. It is also the lowest admissions level since 1995.

The lobbying group represents the major Hollywood studios and provides an annual snapshot of theatrical attendance, but this year’s report was different. For the first time, the MPAA included home entertainment data. It found that entertainment spending in the home rose 11% to $47.8 billion, driven primarily from the popularity of video-streaming services. U.S. digital spending climbed 20% and international digital spending increased 41%. The number of subscriptions to online video services rose 33% to 446.8 million.

In a conference call with reporters, MPAA chief Charles Rivkin acknowledged that the media business has undergone tectonic changes. However, he chose to accentuate the positive, noting the robust ticket sales from foreign markets and the growth of digital sales.

“The entertainment market is strong, it’s vibrant and it’s expanding on many fronts,” said Rivkin.

Frequent moviegoers, defined as people who attend the cinema at least once a month, continued to prop up the business. Though they accounted for just 12% of the population of the U.S. and Canada, they bought nearly half of all tickets sold. Twenty-four percent of the population in North America don’t go to the movies at all.

Rivkin was joined on the call by John Fithian, the head of the National Association of Theatre Owners, an exhibition industry trade group. Fithian downplayed the drop in domestic attendance while acknowledging that the U.S. market is mature.

“Admissions have been relatively constant,” said Fithian, noting that they have increased or decreased at various points over the past decade.

Domestic moviegoers were evenly split between the genders. Latinos continued to over-represent in terms of per-capita attendance, as did African-American audiences. Latinos accounted for the highest per-capita attendance, averaging 4.5 movies a year. Asian moviegoers were close behind, visiting multiplexes an average of 4.3 times a year. Caucasians made up the majority of moviegoers (59%), though they bought fewer tickets than previous years.

Younger adult and teenage moviegoers may not be showing up as reliably as before. It’s hard to know for certain, because the MPAA changed its methodology for conducting the study, moving from a phone-based survey to an online one, which it said impacted results and made it impossible to draw conclusions. That said, looking at 2016 results, moviegoers between the ages of 18 and 24 fell 28% on a per-capita basis, while moviegoers between the ages of 12 and 17 dropped 22%. Audiences over the age of 40, however, did show up in greater numbers.

Total U.S. theatrical and home entertainment spending topped out at $31.16 billion, up just over a percent. Digital home entertainment spending, which includes video-subscription services, rentals, and downloads, was the biggest contributor, accounting for 43% of revenues. Ticket sales comprised 35% of revenues, and sales and rentals of discs and Blu-rays were responsible for 22% of revenues. Globally, consumers spent $88.4 billion on tickets, rentals, and sales of discs and electronic copies of films. That was a 7% year-over-year increase.

The report hit at the same time that Saudi Arabia announced that it will allow AMC to open the first movie theater in the country after a 35-year ban on cinemas. The Middle Eastern country is projected to be a major source of box office revenues, with some analysts predicting it could be among the top ten markets for film. Several other exhibition chains are expected to announce plans to build their own locations.

“We think it could be a very big market,” said Fithian. “It’s literally as we can build [theaters] and they will come.”

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