Cheap Thrills Getting Harder to Find

Although the average movie ticket price rose from 47 cents in 1951 to $1.65 in 1971, to $4.21 in 1991, the picture changes when the prices are stated in constant dollars. Using 2001 dollars, the price rose from $3.20 in 1951 to $7.22 in 1971, but then fell to $5.47 in 1991, and even dropped below $5 in 1994 and 1996.

Theater owners say increases since then can partially be blamed on new theater construction, as well as upgrades involving features such as stadium seating and digital sound systems.

"Between the mid-'90s and the year 2000, we went through the most significant upgrade in theaters ever," said John Fithian, president of the National Association of Theater Owners. "All that building was incredibly expensive — so expensive, in fact, that we had 12 major companies go into bankruptcy. … Given all that, we still only raised ticket prices 34 percent in 10 years."

Of New York's $10 tickets, he added, "I don't think it's shocking. What else can you do out of the home for professional high-level entertainment for that kind of money? Nothing."

Derek Baine, a senior analyst covering entertainment for the media research company Kagan World Media in Carmel, Calif., said the $10 tickets may not represent the state of entertainment prices in rural America.

"In major markets, the demand is there so they push through price increases on everything much more than in other markets," Baine said.

End of Increases?

Some analysts believe the trend toward rising ticket prices may be peaking.

"There's too much of everything in the media and entertainment world, and the result of that will be diminished pricing power," said Harold Vogel, author of Entertainment Industry Economics and head of Vogel Capital Management, a New York venture capital firm. "Most of these things have seen the maximum rate of price increase already, and we are headed for a leveling off if not an actual decline."

Kurt Hunzeker, contributing editor of Team Marketing Report, sees the same trend in sports, where basketball and hockey ticket prices have declined in 2001-02 relative to inflation as attendance growth has stalled.

"When people stop showing up, that's going to be your number one indicator," Hunzeker said. "You're already seeing some teams reduce ticket prices."

Various pressures long have held down prices in the video rental market. In fact, the price of a rental actually has gone down over time relative to inflation, even as another home entertainment option — cable television — has risen steadily.

"The price of buying a video or DVD has been dropping dramatically; so as the price closes between actually buying the videotape and renting it," it limits rental price increases, Baine said. "If we hadn't had DVDs, it's almost certain that the rental market would be flat right now."

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