Can you look back at the film industry without a sense of awe at its resilience and adaptability? It’s no secret that the past couple of years have served as the ultimate litmus test for Hollywood, emerging from a period that could only be described as its trial by fire. Following the pandemic, Hollywood attempted to revert to its pre-COVID ways, albeit with varying degrees of financial and critical success.
In a way, 2021 and 2022 were considered ‘trial years’, when COVID remained a major issue for the business, and movie failures could be attributed to its impact on drawing audiences into physical theaters. But in 2023, things were different. Hollywood was able to assess adaptability and durability in a post-COVID environment.
While it’s tricky to encapsulate the rollercoaster ride of an entire industry within a year’s frame, the vibes emanating from Tinseltown by the end of 2023 mixed heady optimism with cautious introspection.
It is also undeniable that some films, like Wonka, performed exceptionally well box office-wise. Naturally, Barbenheimer—the double feature, the smash-hit phenomenon that rocked pop culture the whole year and set a ton of award show records. What is happening with the MCU, though?
Analyzing the Decline: What’s Causing Box Office Numbers to Drop?
A number of Hollywood productions have underperformed at the box office in 2023; this can be prevented in the future if the industry modifies its current model. The film industry was going through what was arguably its most prosperous period in history prior to the COVID-19 pandemic that struck the industry in 2020.
The year’s financial missteps can be largely attributed to the rising cost of film production. Many current industry trends have an impact on this, including rising actor salaries, the growing significance of special effects, and the popularity of well-known IP films that demand financial outlays for the acquisition of property rights.
Movies like Indiana Jones and the Dial of Destiny, a legacy follow-up to one of the most successful film franchises, were predicted to have cost Disney nearly $100 million even though they brought in $385 million at the box office because of all these factors (Box Office Mojo). Does that fit the budget? 300 million dollars is a terrifying amount!
Most of the budget problems for films like Indiana Jones and the Dial of Destiny, Marvel’s film list of failures, and other action flicks are related to special effects. Filmmakers strive to surpass their previous work by raising the bar with every new release as technical complexity increases. Budgets do, however, increase in tandem with the standard.
This is how movies like Brie Larson’s The Marvels, which were supposed to have a lower budget, ended up shooting almost $300 million and barely making any money back (Box Office Mojo). If it were released this year, it would rank as the fifth highest-grossing movie of the year, which tells you how poorly 2024 is doing in theaters (via X).
Also, with the rise of streaming services and the convenience they offer, it’s clear that the way we consume media is changing rapidly. While many movies are still being released in theaters, the shift towards streaming is undeniable.
Navigating the Economic Landscape: Can Theaters Stay Afloat in 2024?
Comscore reports that the domestic box office for the year is down 10% overall from the same point in 2023, and the bad news is that things are likely to get worse before they get better. With Wonka surpassing $500 million globally (Box Office Mojo) and Will Gluck’s Anyone but You overriding $200 million after a very slow start (Box Office Mojo), the majority of the relative success stories we have seen this year thus far were carryovers from 2023.
While some of this year’s new releases are performing well, they are not doing well enough to compensate for a release calendar that is generally lacking.
AMC and Regal are just two examples of theater chains that barely survived the pandemic (see Variety). Independent arthouse theaters and smaller theater chains are not able to afford to suffer through another painful year as a part of a larger corporation. If 2024 does not improve significantly in the latter half, this might be the final nail in the coffin.
All of this is extremely disheartening, considering that domestic ticket sales in 2023 exceeded $9 billion for the first time since the pandemic started (via THR). Compared to 2022, when sales peaked at $7.5 billion and 2021, when sales did not even reach $4.5 billion, that represented a significant increase (Box Office Mojo). The important thing to remember is that after the catastrophe of 2020, the industry has been steadily recovering. It looks like we have reached a significant roadblock that could upend everything once again.
Lastly, studios are now placing a strong emphasis on theatrical distribution as a major source of future revenue, having begun to recognize the shortcomings of streaming. While optimism is currently scarce, we can only hope that the situation is not as dire as some analysts have been predicting.
Overall, while 2023 may have been a challenging year for the film industry, it also presented an opportunity for reflection and growth.
The Marvels is streaming on Disney+.
