The Death Of The Movie Theater

Hollywood is still releasing movies. The only problem, because of the Coronavirus scare, most theaters are now closed. If this goes on for a couple weeks, it is probably no big deal.

However, if we see this last months, Hollywood film companies are going to have to make adjustments.

At present, there is a lag between the time a film is released in theaters and when it hits the streaming services. This has not changed in decades. In the 1980s,when VHS became big, the film studios protected the theaters by giving them a window before they went to tape.

For the foreseeable future, the studios might put a waiver on this. Since films were already in production and are rolling off the line, the desire to profit is still there. After all, expenses were put out in an effort to get the film made.

Since there is not going to be any theater revenue, we are going to see the studios go direct to streaming. How they handle this is a guess at this point, If this is prolonged, I would surmise the production companies could open up their own streaming services just like Disney did.

Of course, this cuts out the "middleman" in the theaters. What was once a classic way for teenagers to spend their Friday nights could be changing. The theater industry has been suffering for years and this could be the final nail in the coffin.

Here we see a case where new technology eliminates jobs and businesses. A decade ago, we saw Netflix eliminate the video cassette/dvd rental business. Blockbuster and Movie Gallery went out of business due to the shift to online streaming. This is a form of automation although most do not realize it.

We could be seeing the same thing happening again with the movie theater. Streaming is a direct service taking the films directly to the consumer. Once again, fast and direct is the new model.

Coronavirus might allow technology to move in and eliminate this century old industry.

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