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Moviegoing's overseas slump

Globally, 2004 was hot. This year, it's most definitely not. Is it just the weather? Execs have high hopes for 'War of the Worlds.'

June 27, 2005|Rachel Abramowitz and R. Kinsey Lowe | Times Staff Writers

It's the movies, stupid.

American moviegoers aren't the only ones AWOL from the cineplexes this year. As the domestic box office remains mired in the longest slump in 20 years (now 18 straight weeks), international moviegoing, after a phenomenal year in 2004, is reflecting similar patterns. Overseas, the box office has slid by as much as 14% in some major markets.

Whether it's because consumers are distracted by the Internet, DVDs, videogames and ever more sophisticated mobile devices -- or something as simple as warm weather, as has been the case in some key European markets -- it's clear that people around the globe are not going to the movies as much as they have in recent years.

Even if this downturn is just a cyclical blip rather than a foreshadowing of real structural change in moviegoing habits, the brewing international slump is bad news for the Hollywood studios. According to international distribution experts, the foreign gross now accounts for about 50% to 60% of the box office.

Just how bad is it? According to figures from Nielsen EDI, which tracks box-office performance, grosses in Germany are down 14%. In Spain, they're down 9%, and in Australia they're down 11%.

In France, where people might prefer lounging in cafes to watching Americans blow up cars on-screen, admissions are down 13%. In Japan, grosses for Japanese films have dropped 10%, while box office for American product has plummeted 25%, said Veronika Kwan-Rubinek, president of international distribution for Warner Bros.

In fact, the Motion Picture Assn., which tracks international box office for the studios, has sent out a report to its members stating that box office for American fare was down 15% worldwide for the first quarter, according to a top executive who received it. Second-quarter results are unlikely to be any better, as international distributors continue to track declines.

Executives at all the Hollywood studios as well as a variety of international players say the real culprit is lackluster fare, the quease-inducing cinema diet of retreads, remakes and formulaic action movies.

"Primarily, it's product-related," said Kwan-Rubinek, citing last year's international blockbusters, which included "Shrek 2," "Spider-Man 2" and "Harry Potter and the Prisoner of Azkaban." "The product has not resonated as much internationally."

This year, only the latest installment of "Star Wars" looks poised to become a global juggernaut, having already earned $718 million worldwide.

"There is a problem with the American titles," said Florent Gijbels, chief executive of the Kinepolis Group, which operates theaters in Belgium, France and Spain, including those with state-of-the-art digital technology that is not widely available in U.S. theaters.

Others suggest that the box office is just tumbling back to Earth after its stratospheric performance in 2004, when international grosses surged 47%, leading the industry to a banner $25.2 billion in sales, according to the MPA. (Although Mel Gibson's "The Passion of the Christ" made $241 million internationally, "Harry Potter" and "Shrek 2" drove the surge.)

"This business has always been cyclical and always will be," said Andrew Cripps, president and chief operating officer of United International Pictures, which distributes films for Universal, Paramount and DreamWorks. "The problems is ... when people get out of the habit, it takes a stream of good, strong movies to break that [cycle], and I don't think you can draw any conclusions" from the current decline.

Many cite the arrival of the Steven Spielberg-Tom Cruise sci-fi extravaganza "War of the Worlds" this week as a film that could break the cold streak. Like many big releases, the film will be opening on the same day around the world, a strategy increasingly adopted by the studios largely to thwart piracy.

From Tokyo to New York, Cruise has been barnstorming the world to drum up interest, although it's unclear whether his increasingly odd media turns (everything from proposing to girlfriend Katie Holmes on top of the Eiffel Tower to his recent spat with "Today" co-anchor Matt Lauer over psychiatry) will affect the box office.

And most executives expect the end of the year to be strong globally, with such would-be blockbusters as Peter Jackson's "King Kong," "The Chronicles of Narnia: The Lion, the Witch and the Wardrobe" and "Harry Potter and the Goblet of Fire."

The domestic box office could certainly use an alien attack to raise it from the doldrums, as overall box office was down again over the weekend, surpassing the previous 17-week record streak of 1985.

"Batman Begins" grossed $26.8 million to lead the weekend. Among new films, "Bewitched" took in an unmagical $20.2 million, according to estimates released Sunday by Sony, while Disney's "Herbie: Fully Loaded" posted an OK-for-a-kids-picture $17.8 million in its first five days. Universal's zombie movie "Land of the Dead" grossed an estimated $10.2 million.

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It's not a way of life

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