Boxoffice Pro - Winter 2020

INDUSTRY A CENTURY IN EXHIBITION
it. Francis urged exhibitors to get ready
for the competition and reminded readers
that only 15 percent of American theaters
offered stereophonic sound in 1981, while
consumers were getting more and more
accustomed to it—and therefore expecting
it—at home via their radios, tape players,
and headphones. In September of that
year, Ioan Allen, Dolby’s vice president
of marketing, warned in Boxoffice Pro
that as much as 90 percent of theaters
were subpar in sound and/or projection
compared to home equipment. Innovations
in HDTV technologies made the threat
even more imminent. It is interesting to
note that Francis Ford Coppola’s Zoetrope
Studios was actually involved in HDTV
demos, as he believed that the next logical
step would be to distribute films made on
tape via satellite to theaters.
The videotape craze was an additional
challenge to exhibitors, especially
after the mid-1980s. Introduced in the
American market in the ’70s, Sony’s
Betamax and JVC’s VHS were fiercely
competing to dominate the videocassette
and videocassette-recorder industry.
Boxoffice Pro published a study by
the Electronic Industries Association’s
Consumer Electronics Group in 1985
showing that sales of VCRs had jumped
over 72 percent year-over-year. The jump
was preceded by the Supreme Court’s Sony
Betamax Decision in March 1984, which
ruled that home-videotaping practices
were not in violation of copyright laws.
In an unprecedented move, BOXOFFICE
PRO extended its coverage to video
with its “Boxoffice Video Supplement,”
starting in 1985, in an effort to inform
exhibitors of the trends and potential
uses of this new format. Soon, cassette
and VCR sales outpaced domestic box
office grosses. According to a report in
the Video Supplement in 1987, income
from videocassette sales rose 30 percent
compared to 1986 and, at $7.46 billion,
nearly doubled the $4.2 billion total box
office take for that same year.
On top of home-entertainment quality
improvements and the VCR menace, the
’80s saw the explosion of cable TV. It was
no coincidence that all major media and
exhibitor conglomerates rushed to acquire
premium channels. For instance, in 1983
MCA, Paramount, and Warner agreed
to become partners to buy the Movie
Channel, a satellite-delivered motion
picture pay-TV service with over 2 million
subscribers at that time. Four years later,
the late Sumner Redstone, owner of
National Amusements—which operated
400 movie centers—bought a controlling
interest in Viacom, which owned MTV
and Showtime. For exhibitors, the danger
was not just a relentless competition for
audiences. As Perry Lowe, chairman of
the board of the National Association of
Concessionaires, explained in a 1981 piece,
because of inflation and the different cost
structures of the industry, “theater owners
would have to raise prices faster than cable
operators, and the result will be a further
widening gap between the value of seeing
a movie at home on cable TV versus going
out to a movie theater.”
Overall, however, the response of
exhibitors toward these new threats was
not quite as anxiety ridden as it had been
in previous decades. Exhibition had
survived despite countless doom-andgloom
predictions in the past. This time
around, many Boxoffice Pro writers
and contributors were quick to point out
how ancillary markets could incentivize
filmmaking and present new opportunities
for returns. Jack Valenti noted in 1982 that
while some 40 percent of television homes
were equipped with cable, 18 million
subscribed to pay TV or cable movie
channels, and 4 million video recorders
were in the nation’s living rooms, the
year had still recorded an all-time-high
box office record. The reason behind this,
he argued, was simple: People who love
movies love them in every medium.
Industry experts reassured exhibitors
by stressing the opportunity for an
aggressive promotion provided by pay
TV and cable. One such example was
“Movieweek,” a half-hour program on
MSN Information Channel that used an
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