Cinemas are a long-established and popular part of the leisure and media sectors, and despite a difficult few years, the positive benefits they bring to the wider world underpin their continued longevity. This report highlights the cultural, social, and economic benefits of cinemas to the individual, the community, and the economy.
Omdia view
Summary
Cinema is one of the most popular activities across Europe, one of the primary hubs for cultural exchange, local community activity, a central plank in the health of the entire audiovisual industry, a mainstay of our social activity for over 100 years, and one that is evolving with the acceleration of new technology and societal change. The cinema sector is vibrant and optimistic, if a little subdued after a difficult pandemic.
Cinema’s future is in its all-round positive benefits to the wider world
In late 2023, I was approached by three European organizations (CICAE, Europa Cinemas, and UNIC) to write a report on cinemas. This report, titled Beyond the box office: the cultural, social and economic value of cinema is now published and available to read (see Further reading).
As a cinema analyst now for over 30 years, the most frequent question I have been asked since the late 1990s is “when is cinema going to die?”, as if this was a foregone conclusion. Since that time, feature film production has doubled to 9,000 films a year, the number of modern cinema screens has more than doubled to 215,000 screens worldwide, and the global box office had almost trebled by 2019. For a dying medium, it is certainly taking its time about it. The answer obviously is that it’s not dying.
As I was finishing the report off, it occurred to me that it was a culmination of 30 years as a cinema analyst, bringing together all the various ways I have answered that question over the years and grouping them into the reasons why cinema is still going and still vibrant as an art and a media.
Cinema is one of the most popular activities across Europe, one of the primary hubs for cultural exchange, local community activity, a central plank in the health of the entire audiovisual industry, a mainstay of our social activity for over 100 years, and one that is evolving with the acceleration of new technology and societal change.
Across Europe in 2023, there were nearly 1 billion visits to the cinema, down from the peak of 1.36 billion in 2019 and well on the way to coming back. Of these, nearly a quarter of a billion visits were to domestic films in each country (see Figure 1). There were just under 40,000 screens based in 12,300 cinemas in Europe in 2023, employing close to 100,000 people in France, Germany, Italy, Spain, and UK alone ‒ a significant number of people enjoying an interesting and varied career, not to mention all the people engaged in supplying (or indeed analyzing) cinemas around the world.
Figure 1: Admissions to domestic films (millions) and box office revenue for domestic films (€m)
Source: UNIC, Omdia
Film is often referred to as the “seventh art,” with the other six being architecture, sculpture, music, performing arts, literature, and visual arts. The oldest of these arts (sculpture) dates back arguably around 800,000 years, and the newest (excepting film), music, is around 3,500 years (the earliest recorded piece of music). This shows how young film as an artform is, beginning with the first public screening by Lumiere Brothers in 1895.
When set against the other arts, cinema is therefore very new. However, when set against other media, film can seem old given the pace of media innovation, but it was also the first screen medium, paving the way for future technologies. It represents a pivotal point between art and media. Both as art and media, cinemas are as relevant today as they have always been, providing a diverse cultural outlet to their community as well as launching films into the audiovisual chain.
Cinema has a central place in the media economy of the future, as an out-of-home leisure and cultural experience, but also as the dominant launchpad for both large and small films. Films with an exclusive theatrical window perform better on subsequent revenue windows too (VOD, streaming etc.), but also films released theatrically in more than one territory are more likely to be available on more VOD platforms according to a recent EAO study. Cinemas act as the main value creator for rights holders in a way that no other release window can, and if cinemas didn’t exist, we would need to invent them.
As streaming challenges television for viewers in the home, and the mobile phone makes media transportable, the way we consume film and audiovisual content is evolving, but as the oldest screen medium, cinemas have had to constantly innovate to remain relevant for many years. A sector that does not evolve would not have lasted for as long as cinemas have. Outside of technology innovation, cinemas are experimenting with subscription models, all-you-can eat models, membership schemes, dynamic pricing (flexible pricing based on demand), and other business models to find the right way forward for them and for their audiences. A relevant example of this is the Dutch Cineville Card, which brings together 70 arthouse cinemas in the country, offering an unlimited viewing pass. The sector is also embracing data and analytics, generated from these new models to understand and engage better with their audience.
Cinema acts as a mirror to our own and other cultures, reflecting back stories that describe, shape, and illuminate our own experiences. Around Europe and the world, producers are making a wide variety of films (around 9,000 a year). It is the cinema that selects and curates films, communicates with audiences, and ensures that this diversity of film production finds its audience. The cinema is where smaller films come alive and remain alive, a place to see a variety of stories, and curated cinemas offer a chance to see stories that might not be shown elsewhere. This is important for community cohesion, allowing under-represented groups to see themselves portrayed on the screen, and fostering mutual understanding and respect for other values and perspectives.
Shared experience and community are at the heart of the cinema sector
The heart of the cinema sector remains the socialized nature of the viewing experience and the place where a film is shown for the first time. Watching together as a shared experience has positive influences on our emotional wellbeing and connectedness, and there are numerous pieces of research showing that sharing an experience enhances its intrinsic value, even if the participants do not communicate about the experience itself. A BBC report also found that we are 33% more focused when watching on the big screen versus the small screen. Watching together also reduces social isolation and offers an accessible and affordable experience for all members of society.
We share these emotions with others, as we laugh and cry, and gasp and jump with fright. During a study undertaken by academics at UK’s UCL, participants were fitted with biometric sensors that measured heart rate, body temperature, and electrodermal activity. On watching Aladdin together, there were found to be much stronger emotional reactions than when watching alone. Heartbeats began to synchronize and follow the film’s narrative structure. The shared experience with friends, family, and strangers is intensely social. “Social” is the core of cinemagoing and helps create bonds with our friends and the wider community.
A local cinema with an engaged audience is an effective vehicle for community issues and support, from wider global issues (such as climate change, sustainability, democracy, pluralism, and an openness to other points of view) to more local issues (public transport, environment, and supporting local food and drink suppliers). Cinemas are also a gateway into other activities in the community, and a trip to the cinema is often accompanied by a visit to a restaurant, pub, bar, local shops, and other cultural/leisure activities.
While the home-based sector is advancing technology-wise, the home cannot replicate the big screen of the cinema, and this is an area in which the cinema sector has been investing, including premium large format (PLF) screens and other premium experiences. However, that experience is not just about technology, but about offering something over and above the expected experience, including the curation of films and events.
The cinemagoer is a modern, enthusiastic consumer of all types of content, media, and leisure, such as gaming and VOD, and cinema attendees don’t exist in a silo away from the general population. The young people sitting at home playing video games and ordering films from VOD platforms are also proportionally more active cinemagoers. For example, 72% of cinemagoers are gamers, compared to the 51% of non-cinemagoers that are gamers. For transactional VOD (TVOD), cinemagoers are twice as likely to engage with buying content on VOD than non-cinemagoers (53% compared to 27%). As for the recent move to free-ad supported streaming TV (FAST) channels, 42% of cinemagoers use them compared to 27% of non-cinemagoers. Cinemagoers are also avid sports lovers, with 64% of them stating that they are fans compared to only 37% of non-cinemagoers.
All is not perfect in the cinema exhibition sector, things can always be improved, and there are some structural issues hanging over from the pandemic, but there are some core strengths that cinema has displayed for many years that underpin its longevity. The sector is evolving, adapting to new landscapes and behavioral patterns, and will continue to do so. The report’s overriding message is that cinema is a strong medium, underpinned by long-established human behavior, and that is one of the many reasons it has existed for over a hundred years. The report outlines all these reasons and more.
Appendix
Further reading
Box Office and Beyond: the cultural, social, and economic value of cinema: a report by Omdia analyst, David Hancock, commissioned by CICAE, Europa Cinemas, and UNIC (June 2024)
Cinema Landscape Tracker - 2024 (June 2024)
Premium Cinema Formats 2024 (June 2024)
Author
David Hancock, Chief Analyst, Media & Entertainment
