[Reporter’s Notebook] Start with Viewer Support, Not Release Subsidies

Three Major Multiplex Chains to Support Release of Three Korean Films Next Month
A Simple, Temporary Fix That Ignores Fundamental Issues
Risk of Running Out of Films as Pandemic-Era Productions Are Released

Recently, two distinct trends stand out in movie theaters. One is the crowd flocking only to films optimized for large screens and high-quality sound. Representative examples are 'Top Gun: Maverick' and 'Avatar: The Way of Water.' So-called 'moderate hit' films have disappeared. Last year, only eight films attracted over 3 million viewers. In 2018, before the pandemic, there were twenty-three such films, and in 2019, eighteen. The other trend is fandom. Unusually, Japanese animations like 'Suzume no Tojimari' and 'The First Slam Dunk' are strong. Multiplexes are also heavily planning and screening singer documentaries such as 'I'm Hero The Final.'

Movie 'Rebound' Still Cut

The financial results following these trends are dismal. The number of moviegoers last year was 112,805,094, about half of the 216,385,269 in 2018 and 226,678,777 in 2019. This year is no different. Only two films, 'The First Slam Dunk' and 'Avatar: The Way of Water,' have attracted over 3 million viewers. Last month's attendance was 6,421,301, far below the 22,277,733 in February 2019.

The Korea Film Council and the three major multiplex chains (CGV, Lotte Cinema, Megabox) are supporting the release of three Korean films next month to overcome the recession. They will pay distributors and producers an additional 1,000 won per viewer (Rebound, Dream) or 2,000 won (Killing Romance). The intention is to increase the number of releases and aim for a turnaround, but it is a temporary measure. Success at the box office is not guaranteed. No Korean film has attracted over 2 million viewers this year. In terms of buzz, OTT content like 'The Glory' and 'Casino' outshines them. Even 'Gilboksun,' invited to the Berlin International Film Festival last month, is being distributed via Netflix.

The recession is expected to deepen next year as investors turn away from Korean films. Over the past three years, they have suffered significant losses and gradually withdrawn. Major investors such as CJ ENM, Lotte Cultureworks, and Showbox are not in a position to increase their investment ratios by 20-30%. When films produced during the pandemic are released, the supply may dry up.

Heo Min-hoe, CEO of CJ CGV, implemented two ticket price increases but failed to improve performance.
[Image source=Yonhap News]

The culprit that has caused this vicious cycle is none other than the movie theaters themselves. During the pandemic, citing operating losses, they raised ticket prices three times by 1,000 won each. It is unlikely that reduced accessibility will lead to positive effects. CGV recorded an operating loss of 12.3 billion won last year. Lotte Cinema and Megabox are no exception. Movie theaters are no longer an essential medium for watching films. They cannot survive with the cheap tactic of raising ticket prices ahead of anticipated releases. It is time to consider support for viewers rather than release subsidies.