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Theater Owners Bask in Spotlight

Movies: Production, construction records are being set, convention-goers are told. But studio chief urges restraint.


On the heels of the biggest February for movies ever, euphoria reigned this week at ShoWest, the 23rd annual convention of theater owners and movie business folk that convened in Las Vegas on Monday night.

"Year after year, records are being broken," said Alfredo Pourailly, chairman of the Peruvian, Chilean and Argentine division of the Texas-based Cinemark USA theater chain. "Cable TV, VCRs--the ghosts of the past--are gone."

Yet keynote speaker MGM Chairman Frank Mancuso cautioned that between 1990 and 1995, the number of new screens and studio releases grew at a far brisker pace than the number of admissions. Production costs soared 36% and marketing 48%. Hollywood must either find ways to expand the market or cut back on its spending, he said.

"We've lost our sense of restraint," Mancuso said, "continually overproducing and overbuilding. Like Thelma and Louise, we're heading for a cliff."

None of the 3,400 exhibitors and distributors in attendance disagreed with Mancuso's call for an orderly 12-month-a-year release pattern to reduce marketplace clutter.

Perhaps the dominant topic of the week was the exponential growth of movie screens, often within close proximity of one another. While megaplexes increase attendance among frequent moviegoers and bolster foreign revenues, put too many too close together and they'll cannibalize one another.

William Kartozian, president of the National Assn. of Theater Owners, hit home that point, alluding to the 52 screens built by two competing companies 100 yards from each other in Ontario.

"Kartozian's first law of exhibition is 'Thou shalt not Ontario one another,' " he said.

Constructing state-of-the-art theaters is increasingly expensive, he said. And the price of tickets has not kept pace.

"Nationwide, an average family spends $26.27, including concessions, for a night at the movies," he said. "That compares with $68 for the circus; $103.88 for a classical concert; $144 for a rock concert; and $182.82 for live theater. It's the least expensive spectator sport around."

Motion Picture Assn. of America President Jack Valenti said Tuesday that the average cost of making and marketing a film in 1996 was nearly $60 million--$39.8 million in negative costs and an added $19.8 million to promote it, he said. On the positive side, box office revenues were at an all-time high of $5.912 billion, a jump of 7.6% from the year before.

Valenti noted that "studio films are the engine driving the world marketplace. While I glory in the arrival of young talent, independent filmmakers are like minor leaguers, preparing for the New York Yankees or Baltimore Orioles--the Big Show. Making a movie for $20 and two cigar boxes, they get $20 million the next time out."

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