Monday, May 21, 2012

AMC Sale May be Harbinger of the End of Theaters

I am interested in the sale of the AMC chain as a sign to the end of movie theaters. When U.S. assets are sold to foreign entities, a common reaction is that it signals extranational control of American assets. I find it to something entirely different: Foreign companies usually buy into American industries or individual companies that are dead or dying, often slowly transforming into commodities. Consider:

  • The sale of IBM computers (becoming Lenovo) after they were no longer competitive in the market
  • The sale of GE's Black & Decker small appliances after such items became cheap and disposable
  • the entire TV set industry, none of which are manufactured in the U.S.
As far as movie chains go, the real money is in content, and this is where the U.S. excels, exporting our culture and intellectual property around the world. (I understood this when I saw The Addams Family black & white TV show on a local Italian television station.) Furthermore, how many people will be watching movies in theaters in the coming decades?

1 comment:

  1. Goes the way of the drive-in theater, eh? I know this was discussed for years, but movie theater attendance remains strong and prices are actually rising markedly with 3D added fees. Nevertheless the theaters will need to continue to differentiate with added technology and enhanced experience to stay ahead of home theaters and the like.

    I'm intrigued by this latest trend to outdoors jumbo screen showing of sporting events tied to a bar/restaurant. The one near Philly I hear is regularly packed.

    Jon

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