By EDWARD CAMPBELLAENAES and NICHOLAS WAGNERBERGEN/THE WASHINGTON POSTWASHINGTON (Reuters) – Consumers are flocking to digital cinema venues as they look for an alternative to the traditional cinema experience and a way to share more movies online, with many of the big names in the field including AMC, Regal and AMCX reopening or expanding their digital offerings.
From small theaters to major chains, exhibitors are pushing the boundaries of what is possible with digital cinema, using the latest in technology and new technologies to make a splash.
But it remains a risky proposition.
AMC has been struggling to stay afloat in the face of rising subscription fees and the challenges of attracting younger customers who tend to spend their money elsewhere.
Regal has been hit hard by a downturn in the movie industry, as many theaters have closed their doors.
And the industry’s biggest player, AMCX, has struggled to attract new investors and has been losing money for years.
The trend in cinemas is driven by a surge in digital content and sharing, including from streaming video services like Netflix and Amazon Prime, said Jim O’Brien, president of CinemaScore.
The trend has led to a greater demand for a variety of digital viewing experiences, from video on demand, to home-entertainment, to movies and television on demand.
“You have more options, and the quality of your experience is much higher than it was a year ago,” O’Connor said.
Digital Cinema, a digital distribution service based in San Francisco, is offering more than 50 theaters in its digital lineup including AMCX and Regal.
It was founded in 2006 and has expanded to more than 20 locations this year, and plans to launch more than 100 locations this month.
CinemaScore, a global industry leader in digital distribution, estimates that the average digital cinema attendance in the United States has risen from 12.5 million in 2017 to 15.4 million in 2018.
The average movie ticket price is up more than $100,000 since the start of the year, CinemaScore said.
O’Brien said many of those digital theaters are located in rural areas that have traditionally seen the most demand for moviegoing.
AMCX opened its first theater in rural West Virginia in 2018, and it plans to open its first new movie theater in the country in 2020, he said.
AMC, which is owned by AMC Group, has expanded the number of theaters it operates to 40 in the U.S. and Canada.
The shift to the digital cinema has also driven a spike in the number people choosing to pay a monthly fee for movie tickets, said Paul Jorgensen, senior director of audience research at CinemaScore, an industry research firm.
Movie theaters are becoming more popular among younger audiences, who tend not to visit theaters often.
But the popularity of the movie theater has also helped drive up prices, with some consumers paying $20 to $30 for a ticket.
Movie tickets have been rising more rapidly than other ticket categories, including TV and music, he added.
“The trend for the digital movie is going to be driven by consumers who are looking for an experience that is not limited to a limited number of screens,” Jorgenson said.