In a surprise, the international movie box office shows no growth: Britain is down, China is flat

People print movie tickets from a machine at a cinema in Tianjin, China on Jan 13, 2017.
People print movie tickets from a machine at a cinema in Tianjin, China on Jan 13, 2017. PHOTO: REUTERS

LOS ANGELES (NYTimes) - Hollywood's overseas engine conked out in 2016.

For the last decade, movie studios have relied on the international box office for most of their growth. Between 2006 and last year, ticket sales in the United States and Canada increased 20 per cent, to US$11.4 billion (S$15.95 billion). The foreign box office increased 67 per cent over that period, to US$27.2 billion.

In some years since 2006, the annual increase in overseas sales has been as high as 14 per cent as markets like China have grown at a scorching pace.

So it was startling on Wednesday (March 22) when the Motion Picture Association of America said overseas ticket sales experienced zero growth last year as increases in countries like Brazil and Japan could not offset steep declines elsewhere. Germany was down 13 per cent. Britain dropped 10 per cent. Mexico plunged 15 per cent.

China was flat.

Growth in China was held back by a variety of factors, including a crackdown on box-office fraud, fewer ticket subsidies, and consumers who are becoming more discerning. With an eye toward future growth, an effort is underway to increase the number of Hollywood films that China allows to be shown; now there is a 34-film annual quota.

But the Motion Picture Association of America and the National Association of Theater Owners said on Wednesday on a conference call that a stronger dollar was the primary culprit for the foreign falloff. "We believe it's purely based on currency issues," said Mr John Fithian, president of the theatre association.

Both Mr Fithian and Mr Christopher J. Dodd, chief executive of the film association, which represents Hollywood's six biggest studios, emphasised that global ticket sales had increased 1 per cent, to US$38.6 billion, because of a 2 per cent increase in sales in the US and Canada. Mr Fithian called that result "outstanding" and a "huge accomplishment", particularly since many analysts had predicted a domestic decline.

Mr Dodd, a former US senator, used words like "robust", "thriving" and "continued strength" to describe global ticket sales.

Even so, the increase in domestic ticket sales was caused by higher prices; movie theatre attendance in the United States and Canada was flat at 1.32 billion.

One unabashedly positive statistic in the 2016 report: After three consecutive years of declines, the number of frequent moviegoers ages 18 to 24 increased 26 per cent, to 7.2 million. Improved sound systems, screens and seating options may be helping.

"There are key indicators to suggest the future may be even brighter, with increases in attendance among younger demographics," Mr Dodd said.