Film is dead. We've been hearing that for over 10 years now.
Actually, movie theatres are the ones dying.
I've been watching it happen before my eyes. For the last 20 years now. Film is too expensive to produce nowadays – Stanley Kubrick used to say that the film was the cheapest thing on the set once you were there, so a couple dozen extra takes wasn't really wasting that much more money. His point, I guess, was it would cost so much more to go back and reshoot something, get the crew and actors back together, you might as well get as many takes as you want (and a hundred more) since we're all here anyway.
The studios, following the lead of most online concerns, are pushing for digital delivery. It's so much cheaper to stream books, films, your bank statement, anything information-based, than to mail something physical and discreet, an object that's unique (though duplicable) and can not theoretically be in 2 places at once.
It's an easy jump to producing digitally as well - no messy molecules to manage.
We're consuming digital derivatives on an every-day basis, and don't quite realize there was once a physical source. When the fourth (or is it the first?) Star Wars film, "Phantom Menace" was released in 1999, a couple potential bootleggers broke into a movie theatre with the intent of stealing the film to make copies to sell. They didn't realize that it was a 35mm film - built onto a platter, unwielding and heavy, and darn hard to dupe - unless you had access to thousands of dollars worth of equipment. They were found a mile from the theatre, with a mile of celluloid tangled into a hopeless ball in the backseat of their car.
As the cost of everything goes up - gas, babysitters, ticket prices, and at the theatre, popcorn and drinks, and dinner next door - people are going to theatres less. The theatre owners are hurting as well; real estate, labor, delivery charges added onto the popcorn – and even the popcorn itself (which is now being used for fuel alternatives, and enjoying increased demand) – are all forcing them to raise prices. Which lowers attendance further and makes the problem worse.
When the studios begin insisting on delivering their content digitally (which is more manageable, and trackable on their end - no clandestine showings at midnight of "Indiana Jones" in which the manager pockets all the receipts), how many of the theatres will be able to invest in the $100,000+ digital projection/computer system?
It's simply too easy to be entertained nowadays. People aren't falling in love with going to films the way they were in previous generations. You used to go on dates at movies, and see things bigger than life up on a screen, in the dark, with strangers (hoping to be closer friends, real soon?). But how do you fall in love when it's streamed, small, and personal?
The perceived value of something because of peers surrounding you (we all waited in line for this "Star Trek V" - and somehow enjoyed it in a different way by being surrounded by 800 other suckers) demanded you pay attention to something you might not otherwise discover. This isn't entirely a bad thing. I've spent numerous hours talking about the merits - or lack thereof - of "STV." With a commitment of over 4 hours of my life, I was not able to dismiss it out of hand so easily.
Now everything is within reach of everybody. Films, shows, clips, trivia, and music is all accessible with a click, to be casually sampled and discarded.
There's no investment of time or interest in it anymore.
Within the next 10 years, there's likely to be a serious shakeout and downsizing of the number of movie screens out there in meat-space. The way attendance is trending, as much as half of the screens out there will be gone in less than 10 years. And with this will come a corresponding shakeout on what gets produced, an how much of it, as the way it's delivered to you changes forever.
By "shakeout," read "catastrophic restructuring of the business."
And with the disappearance of the audiences for films in theatres comes the disappearance of the experience of watching films, in an auditorium with a crowd. Film showings are derivative of the theatre. They're performance-based (scripted, true; with actors) and through mechanical reproduction, able to be presented as a public event - intangible, in real time. And communal.
It's not selling widgets - individual items to consumers, like shovels, tires, CDs, or downloads.
The big films will become more and more like circus acts – special effects extravaganzas with high-concept tie-ins that can't, won't, or don't exploit the subtle power that cinema is capable of. As there are less and less screens, the marginally profitable will no longer be produced.
As the business further mutates, an elite minority will continue to value the experience of going to movies, and they'll pay a premium for the opportunity to patronize film. Probably old classics, in an appropriately respectful environment surrounded by like-minded aficionados, undistracted by megaplex gimcrackery of on-screen ads and arcades.
Film-going will become like opera. Rarified, expensive, and baroque.
Only for the initiated, like going to church. It'll be akin to a spiritual experience, that enlightens and inspires.
The masses, with infinite access, won't understand why people will still pay $30 - 60 to sit in a seat surrounded by strangers, for something they can't even download. Or even, for something that they can.
Movie theatres won't completely die. They'll just become increasingly irrelevant to Hollywood.
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Postscript: When Ampex introduced a 2-inch videotape system in 1954, a
front-page banner headline in Daily Variety proclaimed, “Film is Dead!” The panic has been going on for a lot longer than I realized.