Crisis for Movie Theaters in the OTT Era? ... 'Specialty Theaters' Expected to Be a Savior

September Box Office Sales Recover to 82% of September 2019 Levels
Seat Occupancy Rates Increase Annually in 4DX and IMAX Theaters
"Will Survive by Adapting to Trends Like 360-Degree Screens and Holograms"

A movie theater in Seoul. / Photo is not directly related to the article. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Hyunjeong Lee] University student Ewha-yeon Lee (23) said, "Who watches movies in theaters these days?" and added, "Isn't it an era where you can easily access content through online video services (OTT) without the hassle of going to the theater?" Park Young-soo, a 30-year-old office worker, praised OTT, saying, "For someone like me who loves movies, OTT is a kind of miracle," and "You can enjoy countless content for the price of one movie."

Although OTT has become mainstream, theaters are also showing signs of recovery after more than three years of the 'COVID-19 tunnel.' According to the integrated ticketing system for movie theaters, the total number of viewers last month was 9,860,587, which is 67% of the same period in 2019 before COVID-19 (14,733,642). The recovery is even more evident in terms of sales. Last month's sales amounted to 101.8778 billion KRW, recovering to 82% of the same month in 2019 (124.44526 billion KRW).

The sector hit by the OTT wave is not movie theaters but IPTV services. According to the integrated online screening system, the total number of online uses in July for Olleh TV, Btv, U+TV, and cable TV VOD was 3,270,309. Compared to the same month in 2019 (5,665,633), this is a 42% decrease. It is interpreted that subscribers who used to watch paid VOD on IPTV have largely switched to OTT.

When television appeared in the 1950s, there was a theory that movie theaters would disappear. However, theaters evolved to become bigger and more spectacular with color and widescreen, and improved accessibility with multiplex formats, enhancing audience satisfaction.

In the OTT-dominant era, theaters' secret weapon is special theaters. Audiences repeatedly watch movies in special theaters, forming a culture of 'N-times viewing.' In fact, the market share of special theater sales in the third quarter of this year increased by 3.2 percentage points compared to the same period in 2019. The seat occupancy rate growth of Lotte Cinema Superplex G (extra-large screen theater), which increased by 5.7 percentage points compared to general theaters in 2019, showed an upward trend of 6.2, 7.2, and 9.8 percentage points each year. For the movie "Top Gun: Maverick," released in June, CGV's 4DX Screen, 4DX, and IMAX theaters recorded seat occupancy rates of 75%, 59%, and 41%, respectively, while general theaters were only at 20%.

Film critic Hong Su-jeong analyzed, "With the development of OTT, another option has emerged, so the pure demand for going to theaters to watch movies will decrease." However, she added, "Special theaters are a bit different," and predicted, "As seen in the enthusiasm for Yongamax (CGV Yongsan IMAX), demand for special theaters will increase." Professor Kim Sam-ryeok of Semyung University's Department of Digital Content Creation said, "Movie theaters have evolved to suit users' convenience from the beginning," and predicted, "Just as theaters found their way with blockbusters after the spread of TV, they will survive by reflecting trends through advanced technologies such as 360-degree screens or holograms in the future."

This content was produced with the assistance of AI translation services.