The Film Exhibition Business: Critical Issues, Practice, and Research

The supply chain for movies released for theatrical exhibition consists of the distributor, exhibitor, and the audience, as shown in Figure 5.1. The audience has opportunities to watch moveis in a number of distribution outlets: domestic theaters, foreign theaters, home video, and cable and network TV, where the time lags between the releases of the movies in successive outlets differ but are typically measured in months (Figure 5.2). Despite the availability of these multiple release windows, the theatrical performance of films in the United States has been considered by practitioners to be a critical success driver. "Theatrical exhibition is the major factor in persuading the public what they want to see, even if that public never sets foot inside a motion picture theater. And how well and how long a picture plays in theaters has everything to do with its value in other markets" (Daniels, Leedy, and Sills 1998, p. 34). the main reasons as to why the theatrical experience is believed to have such a significant impact on the performance of the movie in its other distribution channels are the buzz created by the studios prior to and during the theatrical release dates, generated through high advertising spending, and the attention given by the media to box-office performance and figures.