The MPAA study, produced by the entertainment industry trade group, is intended to provide a comprehensive overview of the film business’s overall state.
In addition to box office revenues, the report found that the global home entertainment business increased by 16% to reach $55.7 billion last year. This was driven primarily by the rise of digital rentals, sales, and subscriptions to streaming services such as Netflix. Digital home entertainment spending in the U.S. increased 24% to $17.5 billion; internationally, this sector climbed 34% to $25.1 billion.
That helped plug the gap left by massive declines in selling and renting DVDs and Blu-rays. In the U.S., disc sales dropped 15% to $5.8 billion and fell 14% internationally to $7.3 billion. Four years ago, physical sales in the U.S. were $10.3 billion and were $14.9 billion internationally, a sign of just how precipitously the DVD market has fallen. Over that same period, digital spending has increased by 170% globally. Much of that rise is attributable to the popularity of Netflix, Amazon Prime, and other subscription services. Globally, digital subscriptions increased by 27% to 613.3 million. Online video subscriptions surpassed cable for the first time in 2018. Cable subscriptions fell 2% to 556 million.
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As DVD sales have atrophied, studios have tried to encourage consumers to keep buying digital versions of movies and shows. The pitch appears to be falling flat, with customers preferring to stream content on Netflix instead of buying things on an a la carte basis. Subscription spending climbed 28% in 2018 to $13.3 billion, while digital sales and rentals fell 5% to $10 billion. The report is unveiled when major media companies such as WarnerMedia, Disney, and Comcast are all readying their subscription services in the hopes of profiting from this growing market.
The popularity of Netflix is bad news for exhibitors, who fear that streaming services are making it easier for people to skip the theatre and stay home to binge. The company has aggravated those tensions by refusing to adhere to a traditional theatrical release model for its films. A select few Netflix movies, such as “Roma” or “Triple Frontier,” show in cinemas before debuting on the service within a matter of weeks.
On the theatrical front, the business continues to rely heavily on frequent moviegoers, which the MPAA defines as individuals who attend the cinema at least once per month. Though they account for just 12% of the population in the U.S. and Canada, they are responsible for 49% of all tickets sold. All told, 75% of the U.S./Canadian population hit up the theaters or their local theatre at least once in 2018. Women accounted for 51% of ticket buyers, and men comprised 49% of the audience.
Per capita attendance was highest among the 12-17 and 18-24-year-olds, with moviegoers in those age ranges seeing an average of 5.1 films last year. All age groups, except those between the ages of 25 and 39 and those over 60, increased their attendance. The most dramatic growth was in moviegoers between the ages of 40 and 49, as middle-aged moviegoers saw 4.3 movies on average as opposed to 3.6 movies in the previous year.
Latino and Asian audiences had the highest per capita attendance among ethnic groups, seeing an average of 4.7 films and 4.5 films last year. Per capita attendance among black and African-American moviegoers increased from 3.4 films annually to 3.7 films in 2018. “Black Panther” was particularly popular with black audiences. They accounted for 35% of all tickets sold to the Marvel blockbuster. Overseas, China was the primary growth driver. Ticket sales in the Middle Kingdom rose 12% to $9 billion. Japan was the second biggest overseas market with $2 billion in revenues, with the U.K. coming in third with $1.7 billion.
