What has been the biggest impact of the pandemic
thus far on Hollywood/the entertainment industry? Which industry or group has
the most to lose? Which industries/companies could possibly gain/benefit from
the current situation? Do you think the pandemic will have any lasting impact/creating
any long-term changes in the entertainment industry? Limit: 7 responses
Disney, which has been one of the major film studios to diversify its revenue streams with its theme parks as well as box office success, has lost all of its potential revenue with these two revenue streams due to the current pandemic. Disney’s “theme parks, experiences (like cruises) and consumer products made up nearly half — 45% — of the company’s operating income last year” (Littleton). Disney has closed its theme park locations in California, Florida, and Paris through the end of March. This is costing the company a significant loss in income as “every day that Disney’s domestic parks are closed costs the company $20 million to $30 million” (Littleton). Disney’s newest Pixar film, Onward, is at the top of the box office, mostly because the company now has no competition in the theaters because all theaters have shut their doors due to the pandemic. The film will be available to Disney+ subscribers in April and is available now to stream for $20. Onward only had two weeks in the theaters, which amounted to “$61.6 million in domestic ticket sales, Pixar's biggest dud by far as a theatrical release” (Munarriz). Although the film is available to stream digitally, it will not make nearly as much money as it could have if it were still in theaters. If Onward were released “a few years ago, [it] could recover with strong DVD sales, but folks aren't buying optical discs the way they used to” (Munarriz). Even before the pandemic, people weren’t going to the theaters, “and that's bad news for Disney. It put out all six of last year's highest-grossing movies, but even a hit factory will suffer if no one goes to the movies” (Munarriz).
ReplyDeleteNBCUniversal, which was slated to release its streaming service Peacock on July 15th, may have to change its marketing strategy around the service or delay the service launching entirely. This is due to the fact that NBCUniversal was planning to launch Peacock a week before the 2020 Tokyo Olympic games. Now, with the possibility that the games may be postponed to 2021, “Comcast doesn’t just lose all of that revenue and all of the marketing that they’d planned to do around the Olympics — they also lose the cornerstone of their Peacock launch strategy” (Littleton).
However, in terms of NBCUniversal’s film division, it is “making The Invisible Man, The Hunt and Focus Features' Emma available on-demand, as well as — most significantly, in terms of budget — the upcoming DreamWorks Animation sequel Trolls World Tour” (Masters). The films are available to rent for 48 hours for $20. While this may seem like a steep price, it is certainly cheaper for a family of four to rent a film on-demand than it is for that same family to go to the theater where tickets are at least $12 per person and then at least one person will want movie theater snacks such as popcorn. Of course, homemade popcorn cannot compare to movie theater popcorn, but the at-home experience is certainly cheaper, especially for families that are facing economic hardship due to the pandemic. Of course, because a family of four can spend only $20 to watch a theatrical release, the question arises if Universal can make enough money. With a theatrical release, “they could have made $260 million... At $20, can they sell 13 million copies? It's a big data point. They're going to learn a lot from doing Trolls” (Masters). Additionally, some executives worry if some families are even willing to spend the money to watch a film once or twice for $20 when that family already has a service such as Disney+, which, when you work out the numbers, is even less expensive than renting one film for $20. Additionally, Disney+ has many more titles that young children would enjoy watching “and streamers have conditioned the public to wait for an on-demand movie to become available as part of their subscription” (Masters).
I think that Universal’s idea of renting a film for $20 can be good in the long run as a potential for Universal to shift the film industry which has been losing in theaters for years now. Instead of having to go to the theater to watch a new release, people could now have the option to do this from the comfort of their homes. Now, if Universal were to extend this into the regular market, they would probably increase the price to make up for lost revenue in the box office. However, increasing the price would push people away from the pay-per-view model because it is more expensive than many of the streaming services people already have. Of course, “some theater owners across the globe were angered when Universal announced its plans... their anxiety is justified, especially as a pay-per-view rental is probably cheaper for a couple than a night at the movies” (Masters). To help the struggling theaters, “NATO is calling on Congress and the administration for relief, ‘to ensure that America’s movie theater industry and its tens of thousands [of] employees across the country can remain resilient’” (Masters).
DeleteWorks Cited
Littleton, Cynthia and Elaine Low. “Hollywood Braces for Coronavirus Financial Hit That Could Change the Industry Forever.” Variety, 20 March 2020, https://variety.com/2020/biz/features/hollywood-coronavirus-financial-festivals-film-television-production-1203537442/
Masters, Kim. “Virus Crisis Forces Hollywood to Reckon With Collapsing Theatrical Windows.” The Hollywood Reporter, 19 March 2020, https://www.hollywoodreporter.com/news/virus-crisis-forces-hollywood-reckon-collapsing-theatrical-windows-1285366?utm_source=Sailthru&utm_medium=email&utm_campaign=THR%27s%20Today%20in%20Entertainment_2020-03-20%2007:15:00_aweprin&utm_term=hollywoodreporter_tie
Munarriz, Rick. “Disney's "Onward" Flop Is Just the Beginning.” The Motley Fool, 22 March 2020, https://www.fool.com/investing/2020/03/22/disneys-onward-flop-is-just-the-beginning.aspx
Sophia Toppo
ReplyDeleteBlog 7
It is clear that the spread of COVID-19 has caused a halt to many businesses and industries. Because the virus is so easily spread, in order to flatten the curve, people are required to stay home and self isolate. Due to this, the film/television industry and basically all entertainment media has been postponed or cancelled. This has a major impact on the production of new television shows or movies, as well as the release of new films. According to the article in Variety, “…dozens and dozens of productions forced to go dark unexpectedly, including at least two dozen pilots for the 2020-21 broadcast TV season”(Littleton, 2020). The Tokyo Olympics have also been postponed until the next summer of 2021. These postponed and cancelled productions have a negative impact on not just the industry and companies but the people who work for the entertainment industry. One of the top companies that is going to suffer from the coronavirus is NBCUniversal and Comcast. NBCUniversal was planning on broadcasting the summer Olympic in Tokyo through their new streaming service Peacock. Now since the Olympics are cancelled, this will have a more negative effect on their ratings and revenue along with the launch of Peacock.
While major corporations have been suffering, so have the workers who are involved in the entertainment business. According to an article in the Los Angeles Times, “Many crew members, assistants and other workers who have been living from paycheck to paycheck now are dealing with the fallout, as more than 100,000 workers in the entertainment industry are now out of a job”(Sakoui, 2020). This is a major impact of the virus, and since there is so much uncertainty of when things will start to get better, it is hard for people who are out of a job to afford rent, groceries, or any other necessities.
If anyone could possibly benefit from this situation it would be streaming services, but not for long. People are urged to stay at home to prevent the virus from spreading, and what else is there to do than watch TV? Each streaming services have their own strategies to providing content for their audiences. Disney+ has many old gems that they can feature on their platform during this time, and I have noticed that Netflix have bee adding some more content to their feed as well. The only problem is production in the industry has completely stopped and Netflix wont be able to premier any original content. According to an article in IndieWire, “If Netflix can’t consistently pump out originals to its many different demographics — meaning not just fast and easy reality TV, but also high-quality prestige series — that could cause a problem”(Travers, 2020). But for now, Netflix and other streaming services will survive in the meantime.
DeleteOverall, I definitely think this pandemic will have a lasting impact because there is so much uncertainty of when this virus will end. While it may be a few months until the spread of the virus starts to cool down, it is still going to take a while for things to get back on track, especially in the entertainment industry. Most filmed pilots that have been postponed might be thrown out, and there might be a huge setback for other major films. I am curious to see what it will be like when these films and shows will finally be released to the public.
Littleton, Cynthia & Elaine Low. (2020). Hollywood Braces for Coronavirus Finacial Hit That Could Change the Industry Forever. Variety. https://variety.com/2020/biz/features/hollywood-coronavirus-financial-festivals-film-television-production-1203537442/
Sakoui, Anousha. (2020). Where Entertainment Industry Workers Can Go for Help During the Coronavirus Crisis. The Los Angeles Times. https://www.latimes.com/entertainment-arts/business/story/2020-03-24/entertainment-industry-offers-string-of-funds-for-help
Travers, Ben. (2020). Streaming Wars: EWhat Compeanies Are Built to Endure Coronavirus Delays? IndieWire.https://www.indiewire.com/2020/03/streaming-wars-netflix-hulu-coronavirus-delays-1202217651/
We live in unprecedented times; A global outbreak has left the entertainment industry essentially crippled for the next few months, potentially longer. Hollywood is directly affected, as the closings of non-essential business, self-quarantines and social distancing has resulted in theatres being closed indefinitely along with large gatherings of people being banned affecting production filming. According to the Hollywood Reporter article, “Below-the-Line Hollywood Faces Sudden Unemployment Amid Coronavirus: "It's a Disaster",” employees working on productions and “gig-workers” are at risk of losing thousands of their jobs, with no health benefits. Movies can’t be seen in theatres and film production is essentially impossible during the crisis. American and global sports leagues have shut down affecting thousands of athletes playing on professional teams or training for events directly, including the cancellation of March Madness, the NBA season, the NHL, MLS, MLB and even the 2020 Tokyo Olympics being postponed. FiveThirtyEight’s article, “The Coronavirus’ Economic Impact on Sports Could be Staggering,” discusses how American sports could stand as the biggest losers of the pandemic, as the amount of money tied up into ticket sales, advertising campaigns and sponsorships is enormous and will be lost. Stadium workers and employees will also be hit extremely hard without any work from professional sports. I believe that sports will be hit the hardest for as long as the emergency continues.
ReplyDeleteHollywood has much to lose as well, but has a much better positioning in the digital age to stay afloat and keep revenue coming. Disney, for example, has many movies they needed to postpone for theatre release, and had to enact the shutdown of all their amusement parks globally. According to the Variety article, “Hollywood Braces for Coronavirus Financial Hit That Could Change the Industry Forever,” Disney has relied on experiences like their cruises, theme parks and consumer products for 45% of their entire operating income. For every 24 hours the theme parks are closed, Disney loses $30~40Million per day.
The biggest saving grace of Hollywood and the entertainment industry is that the move to digital platforms and content is already well underway. Consumers are now stuck at home and have access to streaming services and online content, leading to an increase of thousands of new users and current subscribers to tune back into the wealth of original content that Netflix, Hulu and Amazon have been amassing for years now. There is no shortage of content and many shows and movies may see a rise in popularity that it would not have seen otherwise. ESPN for example, has made their premium NFL Gameday service free until the end of May. The biggest move in my opinion is a service that I have predicted would exist soon in the coming years, but not immediately; Cinema release movies at home. For a larger fee of ~$20, movies still playing in theatres can be streamed in the comfort of your home through platforms like Amazon. This is the future of our cinema content, and I see this service continuing past the crisis.
Kilkenny, Katie. “Below-the-Line Hollywood Faces Sudden Unemployment Amid Coronavirus: ‘It's a Disaster.’” The Hollywood Reporter, 18 Mar. 2020, www.hollywoodreporter.com/news/below-line-hollywood-faces-sudden-unemployment-coronavirus-a-disaster-1285110.
Littleton, Cynthia, and Elaine Low. “Hollywood Braces for Coronavirus Financial Hit That Could Change the Industry Forever.” Variety, 19 Mar. 2020, variety.com/2020/biz/features/hollywood-coronavirus-financial-festivals-film-television-production-1203537442/.
Paine, Neil. “The Coronavirus's Economic Effect On Sports Could Be Staggering.” FiveThirtyEight, FiveThirtyEight, 16 Mar. 2020, fivethirtyeight.com/features/the-coronaviruss-economic-effect-on-sports-could-be-staggering/.
John McMahon
ReplyDelete3/26/20
Blog 7
The coronavirus seems to have had an effect on everyone in the entertainment (and really any) business, from the top down. From actors to producers all the way down to production assistants and runners, the global pandemic threatens the lives and livelihoods of everyone, with seemingly no end in the foreseeable future.
One of the biggest victims of the coronavirus thus far is the loss of broadcast sports due to the premature end (or the unexpected closure before opening day) of major league sports. According to an article in Variety, Barclays analyst Kannan Venkateshwar called live sports the “last remaining anchor for linear broadcast and cable outlets”, and networks are posed to suffer without them (Littletown & Low, 1). That being said, networks like ESPN have found ways to shift the conversation in terms of sports, relying heavily on talk-show content like “SportsCenter”, “Get Up”, and the “30 for 30” documentaries, as well as airing past sporting events (Steinberg, 1).
Another one of the hardest hit industries is the film industry. With the box office hitting zero for the first time in 26 years, studios are poised with difficult decisions about what to do with their release slate. Films like Wonder Woman 1984, No Time to Die and Fast and Furious 9 have all been delayed, while others have opted to go directly to video on demand. In an article by The Hollywood Reporter, “The pay-per-view strategy makes the most sense for low-budget films or movies that didn’t seem likely to pull in stellar box office numbers had they held out for theaters. “For The Hunt or Bloodshot, something like this could be a real good opportunity”, but for larger, blockbuster films it would lose money. Additionally, media analyst Rich Greenfield mentions the success of pay-per-view programming in live sports, such as boxing (the Manny Pacquiao Mayweather fight grossing $400 million). He mentions “That was for a once-in-a-lifetime event where if you didn't pay for it in the moment, it had no value,” and “One question is, is there urgency for a pay-per-view movie the way there is for a sporting event? The answer is probably not." (Masters, 1). Movie studios are bargaining a hefty gamble when it comes to releasing their films: either delay the release and hope the momentum continues for the film, or release it on video on demand and hope households are willing to pay a steeper price (around $20) and not rather watch something else for free. Video on demand platforms and streaming services could have the most to gain from the current situation, but someone ultimately has to lose. Film studios are likely to face the most losses among the pandemic, regardless of either decision they seem to make.
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DeletePersonally, I don’t think the pandemic will have any lasting impact on the entertainment industry, especially the movie industry. Releasing content on VOD platforms is out of necessity, and a last ditch effort to scrounge together money for a film that would otherwise make none with no theatrical release. In an article by IndieWire, author David Ehrlich describes the pandemic as “ unquestionably the worst crisis that movie theaters have ever faced”, later stating that they have been open during wars, terrorist attacks and presidential assassinations (Ehrlich, 1). However, he alludes to the fact that the event of going to a physical theatre and seeing a film on the big screen will never really go away. In his article, he states “Movie theaters are struggling, but their experiential value hasn’t faded, and that’s enough of a reason to assume that they aren’t gone for good” (Ehrlich, 1). The theatre industry has been struggling for the better part of the past decade, but it will essentially never go away (at least not in the foreseeable future). The allure of seeing a movie when it comes out and the theatre experience may be threatened now, but will rebound once the global pandemic quiets down.
Works Cited
Masters, Kim. “Virus Crisis Forces Hollywood to Reckon With Collapsing Theatrical Windows.” The Hollywood Reporter, 21 Mar. 2020, www.hollywoodreporter.com/news/virus-crisis-forces-hollywood-reckon-collapsing-theatrical-windows-1285366?utm_source=Sailthru&%3Butm_medium=email&%3Butm_campaign=THR%27s%2BToday%2Bin%2BEntertainment_2020-03-20%2B07%3A15%3A00_aweprin&%3Butm_term=hollywoodreporter_tie.
Littleton, Cynthia, and Elaine Low. “Hollywood Braces for Coronavirus Financial Hit That Could Change the Industry Forever.” Variety, 19 Mar. 2020, variety.com/2020/biz/features/hollywood-coronavirus-financial-festivals-film-television-production-1203537442/.
Ehrlich, David. “Movie Theaters Are Closed, but Their Value Isn't Lost to Us Yet - Analysis.” IndieWire, 20 Mar. 2020,