- AMC Theatres announced this week that it would charge more for the best seats in its auditoriums.
- But that's not going to help the struggling theatrical industry.
AMC Theatres, the largest cinema chain in the world, is planning to charge more for prime seating in the US.
The company announced the new pricing initiative earlier this week. Essentially, moviegoers will pay a higher price for seats in the middle of an auditorium, unless they subscribe to AMC Stubs A-List, its MoviePass-like program that allows members to see up to three movies a week for a monthly fee. Alternatively, the seats in the first row of an auditorium will be offered at a lower price.
The new pricing is currently in place at select theaters, and the company plans to roll it out to all US locations by the end of the year.
Here's what it looks like on the AMC Theatres website for a screening at a New York City location:
The initiative has been criticized, including by actor Elijah Wood, for how it will affect consumers.
"The movie theater is and always has been a sacred democratic space for all," Wood tweeted. "This new initiative by AMC Theatres would essentially penalize people for lower income and reward for higher income."
But it also isn't necessarily the best business move.
The change comes at a precarious time for the theatrical industry.
Yes, blockbusters like "Avatar: The Way of Water" have shown that people are still interested in the movie-going experience. But the 2022 box office was still down considerably from pre-pandemic levels. Just look at Cineworld, the owner of Regal Cinemas, which filed for bankruptcy last year and is planning to close some Regal locations.
AMC's seat-pricing plan isn't going to help the theatrical business. But taking an honest look at the number of seats or screens in the US might.
In a September note to clients, analysts at the Wall Street firm Moffet Nathanson argued that the theater industry was in "dire need" of trimming back on the over 40,000 screens in the US.
Some in the industry contend that it is a too-many-seats issue, not a screens issue.
"If we have too many screens, you have to specify — is it a screen with 350 seats or one with 45 seats?" Patrick Corcoran, spokesman for the National Association of Theatre Owners, told Insider in September. "We sell seats, not screens."
The theatre group estimated that there are roughly 150 seats-per-screen on average in the US.
17.4% of all available seats were sold from Memorial Day through the end of July in the US last year, EntTelligence, a data company that tracks theater attendance, told Insider. That included all showings at all times of the day, but it's still a lot of empty seats.
Anecdotally, I attended an early morning screening of "Fast and Furious 9" in 2021, and my now-fiancée and I were the only ones in an auditorium of hundreds of seats. It didn't seem like a sustainable business model.
So whether it's an issue of too many seats, too many screens, or too many showtimes, one thing is certain: There's a problem, and charging more for certain seats doesn't seem to be the answer.
In some cases, auditoriums have already begun taking away seats to make room for recliners. And experts think it's been good for business.
"Going leaner and meaner is an advantageous business strategy for theaters in this marketplace given the recalibration of the industry,"Paul Dergarabedian, the Comscore senior media analyst, told Insider last year. "Too many seats chasing fewer patrons is not a model for success. Filling theaters closer to capacity is good for business, particularly if those seats are high-end recliners that elevate the moviegoing experience."