CEO predicts 2D movie prices will increase & 3D movie prices will decrease in 2012

[BLUEGRASS]

Joe Paletta, CEO of Spotlight Theaters, predicts that in 2012 cinemas will begin to eliminate the premium charges on 3D movies and raise the prices of 2D movies. (http://www.screentrademagazine.com/#...tta/4558914185)

Among the bigger changes will probably see the 3D-upcharge disappear. 3D charges will help increase the overall ticket-price but, as an industry, I think we’ll see a blend begin to emerge in 2012, where patrons will have a single price for both 2D and 3D films. 2D prices will increase and 3D prices will decrease.

He also predicts that concession prices will increase:

Theaters are also expanding their concession menus to provide more than the traditional popcorn, soda and candy staples. Customers are becoming more sophisticated and discerning in seeking out theater menus that offer hot meals, sit-down service and dinner cocktails. The theater environment is conducive to providing this type of concession menu, which will fulfill the customer’s desire for a one-stop entertainment venue.

However, I cannot see exhibitors’ willingness to absorb spiralling concessions costs. We are already operating on very slim margins and will find ways to pass along price-increases to the consumer in some form or fashion. Frankly, movie theaters that do not turn a profit on their investment will go out of business.