January 7, 2009 - THE movie business used to be an American enterprise whereby Hollywood made movies primarily for Americans. But 2008 proved yet again that the North American market is no longer king.
While US and Canadian movie-goers spent $9.78billion on tickets last year, Hollywood revenue from the rest of the world eclipsed that figure, jumping to a record $9.9 billion. That represents a 4 percent increase over 2007 and means in the past two years foreign box office receipts have grown by a healthy 15 percent. The result is that Hollywood is now forced to consider what the rest of the world wants to see. In the US, meanwhile, declining sales have been masked by rising ticket prices, which increased by an average of 5 percent in 2008. Even though revenues were up over 2007, fewer people went to the movies. In 2007, 1.4 billion tickets were sold against 1.36 billion last year.
Studios compete with each other as if filmmaking were a sport. And Hollywood being Hollywood, the winner is the studio that makes the most money. Outside North America, Paramount led the way with $2.04 billion in foreign grosses on the back of the runaway success of Indiana Jones and the Kingdom of the Crystal Skull ($469.5 million), Kung Fu Panda ($416.5 million), Madagascar: Escape 2 Africa ($305 million) and Iron Man ($214 million).
Warner Bros came in second with $1.81 billion, propelled by The Dark Knight ($465 million), but it's worth noting the Burbank-based studio would have swamped Paramount had it not decided to hold back the next Harry Potter installment, The Half-Blooded Prince, until this year.
Universal brought in $1.71 billion, largely because of the surprising success of Mamma Mia! ($428 million), a film that flew largely under the radar in the US, although Americans have now warmed to it, making it the highest selling DVD of the North American holiday season. A late-year push by the pooch love-flick Marley & Me got Fox into fourth place with $1.6 billion, ahead of Sony, which edged Disney into the disappointing -- and unaccustomed -- sixth position among the major studios.
In the US domestic market, Warner Bros took the mantle with $1.79 billion after The Dark Knight took $531 million, making it the highest grossing film in the US after Titanic.
As the Screen Actors Guild (SAG) mulls over a strike, its members will be interested in hearing that Netflix, the leading DVD mail-order rental company, has announced a partnership with LG Electronics to stream movies directly into subscribers' homes. Netflix will use internet connections to allow subscribers -- who pay about $10 a month -- to watch films from its vast libraries on specially formatted LG television sets.
The announcement has great implications in the proposed actors' strike because one of the key stumbling blocks to a new labor agreement is the union's refusal to accept tiny residual payments to its members for films and TV shows downloaded from the net.
SAG leadership remains in disarray as the 120,000 members are torn between standing firm for a better deal with the media conglomerates and taking what's on the table to avoid shutting down Hollywood for the second time in a year. The Alliance of Motion Picture and Television Producers (AMPTP), which represents the studios, is pushing actors to listen to the moderates within SAG, who want to avoid another strike. "The 100-day writers strike -- which resulted in the writers receiving the same terms that the DGA (Directors Guild of America) achieved without a strike -- cost our economy $2.5 billion," AMPTP says in a statement. "A SAG strike would cost the working families who depend on our industry even more, at a time when everyone is already under extreme pressure by the unprecedented national economic crisis." The guild will vote next week on whether to give its negotiating committee the authority to strike.