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Published December 27, 2013, 03:35 PM

Hollywood poised for best-ever box-office year

LOS ANGELES (AP) — Despite a string of summertime flops, Hollywood is expected to have a banner year at the domestic box office, coming in just shy of $11 billion, the largest annual take ever. But because of higher ticket prices, actual attendance at North American theaters remained flat after a decade of decline.

By: JESSICA HERNDON, AP Film Writer, Associated Press

LOS ANGELES (AP) — Despite a string of summertime flops, Hollywood is expected to have a banner year at the domestic box office, coming in just shy of $11 billion, the largest annual take ever. But because of higher ticket prices, actual attendance at North American theaters remained flat after a decade of decline.

With the current domestic box-office tally nearly 1 percent ahead of last year at this time, 2013 could surpass 2012's overall haul of $10.8 billion by more than $100 million, according to box-office tracker Rentrak.

High-profile flops such as "The Lone Ranger," 'After Earth," 'R.I.P.D." and "Turbo" were offset by mega-hits like "Fast & Furious 6" and "Iron Man 3," which consistently filled theaters last summer.

More recently, Warner Bros.' space epic "Gravity" has earned $254 million domestically, Lionsgate's sci-fi sequel "The Hunger Games: Catching Fire" has grossed $378 million and fantasy prequel "The Hobbit: The Desolation of Smaug" has brought in $150 million for Warner Bros.

A strong holiday slate is also boosting the year's box-office total. "There has virtually been every kind of genre of film available," said Rentrak box-office analyst Paul Dergarabedian. "You have blockbusters like 'Hobbit' and esoteric, challenging films like 'Nebraska,' 'Dallas Buyers Club' and 'Mandela: Long Walk to Freedom.' All of these films get people to the movies."

But the National Association of Theater Owners projects that the actual number of tickets sold domestically in 2013 will remain about the same as last year's 1.36 billion. That's down from the all-time high of 1.57 billion admissions in 2002.

In 2011, the domestic box-office gross sunk to a 16-year low, dropping 3.5 percent from 2010 to $10.2 billion. But 2012 saw the industry rebound with a $10.8 billion total, thanks to hits like Disney's "The Avengers" and Warner Bros.' Batman finale "The Dark Knight Rises."

Both films screened in 3-D, a profit-boosting perk that saw a huge increase in popularity following 2009's "Avatar." But the public's appetite for the heightened technology has eased, leaving Hollywood to search for other ways to counter audience drain.

Entertainment available on countless portable devices continues to threaten multiplex attendance, as do advanced home theater systems and video-on-demand services offering original premium programming and feature films the same day as their theatrical release.

But Hollywood is fighting back with the premium multiplex experience. Movie attendance may be tepid, but the audience is willing to pay more for theater extras, which keep the bottom line growing, even as admissions remain flat.

"Theaters are offering IMAX, bigger chairs, dine-in options and alcohol," said Don Harris, head of distribution at Paramount. "It's kind of like the difference between staying at a Hilton or a Ritz Carlton. I think what you saw this year was a growth in a segment of the audience that isn't as worried about the price of a movie ticket as they are interested in the out-of-home premium experience. I think you're going to see that going forward."

And with all of the bells and whistles now offered at theaters, movie-going is still one of the least expensive ways to be entertained, compared to concerts, sporting events and live theater," notes Richie Fay, Lionsgate's president of domestic distribution. (So far this year, the average cost of a movie ticket in North America has been $8.05, according to NATO.)

Social media has also helped boost sales, Fay observed, with Twitter and other services providing a powerful marketing tool for studios and a faster way for fans to spread that all-important word of mouth. "People don't have to wait a day for a print story anymore. It's an important part of the growth of the industry."

Studios are hoping to continue that growth in 2014 with such anticipated releases as "Captain America: The Winter Soldier," 'The Amazing Spider-Man 2," 'X-Men: Days of Future Past" and "Transformers: Age of Extinction," 'Dumb and Dumber To," 'The Hunger Games: Mockingjay — Part 1" and "The Hobbit: There and Back Again."

"I think the fact that attendance is at least holding its own is impressive, given the number of other media options in the mix," said Rentrak's Dergarabedian. "Going out to the movie theater is clearly as attractive, relevant and viable as ever with audiences."

Although year-end figures for the overseas box office are not yet available, foreign receipts are typically two to three times higher than domestic earnings. So fan-driven hits like "The Hangover Part III," which grossed $112.2 million in North America, are expected to earn more than double their domestic takes overseas.

"With all of its ebbs and flows, ups and downs, the theatrical experience just continues to resonate," said Rory Bruer, head of distribution at Sony.

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