Cinema revenues in Australia are projected to decline gradually over the next 5 years primarily due to cheaper substitutes on offer for consumers

The pinnacle of cinema in Australia occurred at the turn of the millennium when one of the most popular forms of entertainment for kids and adults alike was to go to the local movie cinema and see the latest Hollywood blockbuster. Over the past two decades there has been a massive change to the cinema landscape with consumers turning to cheaper alternatives as technology improves such as the introduction of the DVD and more recently SVOD platforms. Traditional distributors and exhibitors have been relatively conservative in their reaction to the changing market as they have tried to maintain revenues by increasing pricing and have consequently barely scratched the surface of innovation

Netflix has paved the way for cinema disruption and distributed 75 original films in 2018

Fellow disrupter MoviePass has continued to struggle due to an unprofitable business model

Contents

Key Takeaways

Introduction

Stagnant growth for Australian cinema revenue

• Demand is falling
• Admission prices are high
• Similar scenes in New Zealand

What’s happening globally?

• MoviePass – A lesson in how not to disrupt
• Changing Distribution Model
• Cinema trends in Asia

Conclusion

List of charts/tables

Figure 1. Australian Film Revenue (FY06A-FY23F, A$m)

Figure 2. Australian Film Distribution Market Share

Figure 3. Cinema attendance per capita

Figure 4. Films released in Australia by country of origin

Figure 5. Growth in Cinema Admission Prices

Figure 6. New Zealand Cinema Revenue FY14-17 (Distribution and Exhibition)

Figure 7. New Zealand Film Production Revenue FY14-17 (Pre and post production)

Figure 8. Original Films Distributed by Netflix

Figure 9. Modern Cinema Distribution Window

Figure 10. Traditional Cinema Distribution Window