Movie ticket prices continue to increase throughout the year

American moviegoing audiences have likely noticed that over the years ticket prices have steadily increased. Whether they find evidence of this increase in their noticeably lighter wallets after visiting the box office (although, who still visits box offices in the age of online ticketing?) or when their grandparents regale them with tales of seeing a picture show for a dime in “the good ole’ days,” the trend is undeniable. The causes of this tremendous surge, especially in the past ten years, are somewhat vague. While initial thought given to this problem might cite rises in the costs associated with production or economic inflation as the main contributors, a closer look at the business dealings between distributors and theater chains suggest a more complex answer.

The history of the movie ticket began on a relatively small scale, with 5¢ theaters called nickelodeons cropping up around the country in the first decade of the 20th century. The rise of the major movie studios in the 1920s coincided with a monopoly of the larger theaters by the studios until antitrust laws prohibited such actions. This left an opening for entrepreneurs to buy up theaters and create exhibition chains of their own. The oldest chain in the United States is AMC Theaters, originally called Stanley Durwood of American Multi-Camera, which remains one of the top three movie exhibitors today, along with the Regal Entertainment Group and Cinemark Theaters.

These large scale exhibitors are able to negotiate with the distribution subsidiaries of studio and media conglomerates about what percentage of ticket sales the exhibitor can hope to recoup. However, the majority of gross ticket sales from big-budget studio movies are usually returned to the studio. Smaller chains and independently owned theaters must also return a majority of their ticket sales to the studios, in addition to essentially “renting” the film to screen in the first place. The negotiated percentage of sales going to the studio distribution company is often higher for the few weeks after the film opens and the exhibitors percentage rises the longer the film’s theatrical run.

The effect of these transactions has been to steadily draw prices up, as shorter theatrical runs, with more emphasis put on opening weekend draws, means a studio must make its money back in a much shorter period of time, compared to theatrical runs in the past which could last for months. The mandate by major distribution studios for big opening box office’s has contributed to smaller theaters charging as much as larger chains. Even in the Pioneer Valley, a small venue like Tower Theaters charges $8.50 for an adult ticket to an evening show, the same price that the Cinemark theater at Hampshire Mall charges for an evening adult ticket.

It is also remarkable that the $8.50 ticket is more expensive than the $8.02 ticket price, which the National Association of Theater Owners (NATO) reported in the second quarter of 2012 as the highest average ticket price ever recorded in U.S. history. NATO monitors the average ticket prices in the United States and has recorded a steady rise in price from $0.36 in 1948 to the alltime highs in 2012, when prices topped $8. The organization attributes this incline to the studio decreed opening weekend box office focus, declining theater attendance since the advent of home viewing systems and the introduction of 3D and digital technology.

All of these justifications seem valid, and yet there still remains the quirk of the general uniformity in ticket prices (excluding 3D or XD ticket prices), meaning that the cost of a ticket is level at most chains regardless of the film. It will cost you the same at a chain to see a low budget film by Michael Haneke as it would be to see the latest Michael Bay monstrosity in 2D. Essentially, this makes buying a movie ticket a complete gamble. Since there is no distinction in quality of the film attached to the price of a ticket, when a ticket is purchased there is a chance that it will be worth the price and an even greater chance that you will be cheated out of almost $9. So you’ve got to ask yourself one question: Do I feel lucky. Well, do ya, punk?