Movie Malaise Rattles Academy Awards

Oscar poster 2021 — The Oscars award telecast is still a big event but it suffered a 20 percent audience decline last year.

As Hollywood looks to the Oscar telecast on April 25, the movie industry remains battered but has cause to be optimistic about better days ahead.

On that bad news, the pandemic closed theaters, interrupted production and triggered large audience viewership declines for glitzy awards shows like the Oscars. Further, Hollywood is engulfed in painful self-evaluation about under-representation in the industry hierarchy of minorities, particularly blacks. On top of all that, the video streaming revolution exemplified by Netflix — a $23 billion-revenue behemoth today — upends industry customs and threatens the oligopoly dominance of the five legacy major movie studios.

The movie industry moved into Oscar awards season in a state of malaise, which is expected to depress the size of the Oscar telecast audience. The warm-up Golden Globes Award telecast on Feb. 28 suffered a catastrophic 62% audience decline. With pandemic gathering restrictions crimping Oscar glitz, the Academy Awards broadcast on ABC Television figures to pull a smaller audience, coming on top of enduring gradual audience declines every year since 2014, except for a small 2019 uptick. For last year/2020, the audience decline was a sharp 20%.

ABC Television pays the Oscar organization the Academy of Motion Picture Arts and Sciences (AMPAS) for TV rights (the Oscars generate around $130 million in net revenue to AMPAS annually), and if audience erosion leads to a rights fee decline then AMPAS finances will be crimped. The Oscars are called the Super Bowl for female audiences by attracting advertisers targeting women (fashion and cosmetics are popular categories). The 2020 Academy Awards telecast averaged 23.6 million viewers which is about one-quarter the size of pro football’s Super Bowl telecast. The Oscars audience is way down from recent levels as, for example, in 2001, the Academy Awards averaged 42.9 million viewers.

Pricing for 30-second TV commercials held up recently at around $2 million each, but eventually the decline in eyeballs watching will depress ad prices and the event’s economic profile. For 2020, AMPAS cleared a lofty $131 million on the Oscars and retains healthy capital reserves.

Gregg Kilday suggests in a Hollywood Reporter article that movies are falling off a lofty perch that they’ve held for a century as prestige entertainment. That’s because audiences are siphoned off by mushrooming digital media. But Kilday expects movies will endure on a slightly lesser level, much like books did when publishing exploded centuries ago with the introduction of magazines and newspapers — that era’s equivalent of today’s digital media revolution.

“Movies that pride themselves on being serious, cultural commentary, with only the occasional exception, no longer dominate the culture the way they once did,” writes Kilday. “The best films — the kind that now most often win Oscars — don’t reach a mass market but speak to a smaller, self-selecting cognoscenti.”

Not helping this this year’s crop of nominees, which again reflects Oscar voters’ penchant for serious, dark and tragic themes. Think of the Oscars as an “indie fest” — a festival for independent films with heavy drama. Only one of the eight nominees is distributed by one of Hollywood’s five major studios — Warner Bros.’ “Judas and the Black Messiah.”

Netflix corralled a runaway 35 Oscar nominations and Amazon Studios 12; Disney and Warner Bros. were next tied at eight. But awards are not economic power and Oscar voters don’t seem inclined at present to reward streamer movies (like Netflix) with top prizes because those films aren’t cinema-centric; Oscar voters are.

Of the eight Oscar Best Picture nominees, only two have the matrix of collateral nominations (such as Best Director for awards leading up to the Academy Awards) that make them front-runners. Those two are Disney-owned Searchlight Pictures’ road drama “Nomad” and Focus Features’ revenge drama “A Promising Young Woman.” (Their box office in the Covid-19 era isn’t comparable to past years).

In 1977, popcorn blockbuster “Star Wars” was nominated for Best Picture Oscar because it was unique at the time and a boxoffice sensation; since then, voters routinely ignore such upbeat, mass market movies including all the other “Star Wars” theatricals. Despite being 2009’s Oscar Best Picture winner, drama “The Hurt Locker” grossed just $17 million domestically ranking a lowly No. 146 in cinema revenue for that year, and dark “Moonlight” just $29 million in 2016 to rank No. 136 — again despite the Best Picture Oscar glow.

As for reasons to expect better days ahead, there are several developments. The video streamers have embraced the movie format — which are one-off audio/visual productions running 90 minutes or longer. Many streaming original movies will also run in cinemas. For example, fourth-ranked pay cable premium pay TV service Epix commissioned its eight stand-alone films with horror-meister Blumhouse, which has a brand-awareness in the scare-me genre. Elsewhere, Amazon commissioned its first original movie in Italy.

Such movie initiatives have popped up across the video streaming landscape. Movies are in the mix across pay TV channels and streamers because they are promotable, fill schedule gaps and can enchant audiences.

In another promising sign, movie theaters are reopening in the United States, and audiences in other countries that previously reopened have flocked to their cinemas.

While Hollywood at large is also roiled as streamers like Netflix barge into the business and siphon audiences, that’s been good for talent. Booming production as streamers spend on original content sparks bidding wars, raising Hollywood salaries and broadly increasing employment. Legacy major movie studios also mount a counter-strike, launching competing services such as Disney+, Paramount+ and HBO Max (Warner Bros. is a corporate sibling).

So, 2021 is expected to be a transition year, as industry and consumers battle pandemic fatigue, the five legacy movie studios work to repel video streamers, and diversity tensions roil Hollywood. With reopening, the restless youth demographic will again be unleashed and is expected to embrace out-of-home entertainment, particularly after being cooped up for a year.

As Deadline.com awards columnist Pete Hammond noted of the year gone-crazy with Covid-19, “the only theaters that Oscar voters saw contenders in were drive-ins.” It’s been that kind of year.

Related content:

Reader Interactions

Leave a Reply Cancel reply