Long term evolution of movie exhibition industry

Abstract

The objective of the study is to predict the long-term evolution of the movie exhibition industry keeping in mind the threats and uncertainties to the industry. Industry analysis revealed a low attractiveness outlook while the industry is riddled with external challenges in the form of Technology (Video on Demand) and Politics. Hence, there can be a notion that the industry is heading for a decline. However, comparison with the Chinese movie industry and its rapid growth has revealed a potential growth available for the Indian movie exhibition industry as well, which prompted the further analysis. The industry was analysed to understand parameters that uniquely define it – namely Capital Expenditure (Low when compared to returns), Revenue Sources, Semi-Variable Costs and Cost structure, Consolidation and Spatial Differentiation between incumbents. These parameters are then taken and parallel industries which are defined by the same parameters were observed namely Telecom, Hospitality, Health Care and Retail industries. Individual predictions were then concluded for the movie exhibition industry from observing the now evolved aforementioned industries. The movie exhibition industry has dependencies on both product and the service and hence, a shift from the product to the service was predicted as more technology is adopted over time. This result is crucial, and can be extended to other similar industries.