"The industry has to consider whether or not American audiences are sending a message about the quality of the movies they are getting — or just the way and the place in which they get them," said Paul Dergarabedian, president of Exhibitor Relations, a firm that analyzes box-office trends. "You can bet that producers, writers, directors and studio heads are all huddling intensely to consider what this means and change their behavior to keep it from continuing."
It could just be a continued shift away from multiplexes and toward Blockbuster, Netflix, and other home-viewing options, Dergarabedian and others say.
In a related story, Video Business is reporting that consumer spending on home video and rentals has declined for the first time in 25 years.
Despite the overall decline in revenue, spending on all DVDs was up nearly 10% on an enormous base of more than $22 billion. The market for the DVD format stood at just $6 billion as recently as 2001. Although the less than 10% growth rate in 2005 is only about one-third of the more than 28% gain in DVD revenue in 2004, most studios enjoyed notable home video revenue increases this year.