The rise and fall of movie theaters — and how the coronavirus pandemic might change them

amc movie theater nyc covid19 amc movie theater nyc covid19
A person wearing a mask walks past the closed AMC 14 movie theater during the coronavirus pandemic on May 14, 2020 in New York City.
Noam Galai/Getty Images
  • Movie theaters as we know them have been around for more than a century.
  • However, the coronavirus pandemic has forced movie theaters nationwide to close or and public health and safety measures.
  • Hope still remains for Hollywood, though, as many of the summer's biggest blockbusters have yet to be postponed and .
  • Visit Business Insider's homepage for more stories.

2020欧洲杯小组赛The movie theater industry has been around for over 100 years, but unprecedented times have created a perfect storm for the demise of movie theaters.

2020欧洲杯小组赛"We should be a month into summer blockbusters, and we don't even know if they're going to show up this summer," Jeff Bock, senior box-office analyst at Exhibitor Relations, told Business Insider.

2020欧洲杯小组赛Steadily and now-shuttered movie theaters and palaces nationwide have put the fates of summer blockbusters into question.

Here is a look at the rise and fall of movie theaters — and a solution that could potentially save the industry.

Early movie theaters, or electric theaters, were housed in tents.

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Movie-goers stand in front of large cloth banners which mark the entrance to an early movie theater in 1905.
Getty Images

Early "movies" were nothing special compared to the blockbuster films of today — they were short, black-and-white, silent films that showed everyday occurrences like workers leaving a factory after the workday or a train entering a station.

However, they delighted, amazed, and even shocked audiences of the late 1800s.

The first permanently built movie theater was Tally's Electric Theater.

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Crowd shot of well-dressed adults in movie theater, Chicago, Illinois, circa 1945.
Kirn Vintage Stock/Corbis/Getty Images

2020欧洲杯小组赛Built by and named after Thomas Lincoln Tally, the theater was the first building to be , rather than a combination of films and live performances.

2020欧洲杯小组赛The theater opened its door on April 2, 1902, in Los Angeles, California, according to the . The theater was an instant success, and after tickets for its night showings between 7:30 p.m. and 10:30 p.m. began to consistently sell out, Tally decided to add matinee shows as well.

In 1905, Pittsburgh movie theater owners Harry Davis and John Harris introduced 5-cent Nickelodeon movies.

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Entrance to the Hippodrome Theater.
Schenectady Museum/Hall of Electrical History Foundation/CORBIS/Corbis/Getty Images

2020欧洲杯小组赛The movies were . However, the concept of "Nickelodeon" theaters, which got their name from the 50-cent charge for patrons, would soon become popular nationwide. The theaters showed both short films and live vaudeville performances.

According to , by 1907, around 2 million Americans had visited a Nickelodeon theater. The storefront theaters remained the most popular outlet for film-viewing until many of them were replaced by larger theaters built in the 1910s.

Most movie theaters in the early 1900s only had one screen so only one film could be shown at once.

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The Paris theater in New York City.
Walter Leporati/Getty Images

Not only were movie theaters unable to play more than one movie at once, they also lacked sound up until the 1920s. Instead, films would either be silent or to accompany the images on the screen.

, which opened the movie-going experience up to a much wider audience. Cinema visitors no longer had to be literate to enjoy a film.

According to , by 1930 movie theater attendance had reached more than 90 million visitors per week. 

Post-nickelodeon movie theaters were designed to be glamorous.

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The auditorium at the Odeon, Leicester Square, London, 1937.
English Heritage/Heritage Images/Getty Images

Before the 1920s, . However, movie theater owners wanted to change this reputation in order to attract a more upscale clientele.

Many theaters, called "movie palaces," would feature stunning interiors with carved ceilings, luxurious seats, and expensive carpets. Visitors would dress in their best clothes to attend the cinema, often pictured wearing top hats, coats, and other glamorous attire.

Despite being the most iconic movie-watching snack of today, popcorn was actually once banned in movie theaters.

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A customer using a coin-operated popcorn machine, which charged 10 cents per bag.
Wallace Kirkland/The LIFE Picture Collection/Getty Images

2020欧洲杯小组赛It's hard to imagine movie theaters without popcorn. However, there was a time when the snack was explicitly banned. While popcorn was a popular treat at entertainment sites like circuses and fairs in the late 1800s, movie theaters didn't allow the food to be sold.

"Movie theaters wanted nothing to do with popcorn because they were trying to duplicate what was done in real theaters. They had beautiful carpets and rugs and didn't want popcorn being ground into it," Andrew Smith, author of "," told Smithsonian Magazine. 

2020欧洲杯小组赛Instead, popcorn vendors would park their carts outside and sell them to people entering the theater. However, , once-prestigious movie theaters began selling the snack in an effort to appeal to wider audiences.

The movie theater industry got a revamp with the introduction of the drive-in in the early 1930s.

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A drive-in movie cinema in Los Angeles, circa 1930.
Popperfoto/Getty Images

On Tuesday, June 6, 1933, Richard Hollingshead opened the in Camden, New Jersey.

According to , Hollingshead came up with the idea after listening to his mother complain about not being able to sit comfortably in movie theater seats.

He then began experimenting with different projectors in order to open the first open-air theater, where viewers could drive into the lot and watch films from the comfort of their own automobiles.

The first multiplex — a movie theater with more than one screen — opened in a Missouri shopping mall in the early 1960s.

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Interior of a commercial retail mall in the 1960s.
H. Armstrong Roberts/Retrofile/Getty Images

in Kansas City, Missouri, the first multiplex theater, opened in 1963 in the Ward Parkway shopping center. It had two screens and sat 700 people.

When the theater first opened, it would show the same movie on both screens. However, Stanley H. Durwood, the man who owned and operated the theater, eventually began in order to attract a larger audience.

Soon, single-screen theaters nationwide were being . This caused many single-screen theaters that were not renovated to go out of business.

The first permanent Imax 3D theater was built in Toronto in 1971.

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People watching an Imax 3D movie.
BRUCE BISPING/Star Tribune/Getty Images

"Tiger Child" was created for Expo 1970 in Osaka, Japan, and was the first movie shown in an Imax theater.

The first permanent Imax installation, called the Cinesphere, was built at the . The first film it showed was "North of Superior."

The first megaplex built in the United States was the AMC Grand 24 theater in Dallas, Texas.

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AMC Grand 24 in Dallas, Texas.
AP Photo/Ron Heflin

The 5,000-seat theater opened in 1995 and featured a whopping 24 different screens, many of which opened with the movie "Die Hard With a Vengeance."

The movie theater was , with part of the original building converted into restaurant space.

However, movie theater attendance is falling.

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Movie theater concessions stand.
Tami Chappell/Reuters

According to , admissions to movie theaters in the US and Canada fell 5.8% in 2017, the lowest attendance since 1992. Attendance rose again in 2018, according to the . However, the following year, both ticket sales and revenue declined.

Rising ticket prices have allowed movie theaters and studios to continue churning out billions of dollars, especially with record-breaking Marvel releases. However, it's clear that interest in going to movie theaters has continued to decline.

Over the last few years, the rise of in-home streaming services like Netflix, Hulu, Amazon Prime Video, and more have changed how people view movies.

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A person watching Netflix.
pixinoo/Shutterstock

Many blame streaming services like Netflix, Hulu, Amazon Prime Video, and other platforms for the decline in movie theater attendance. However, the issue is less about where people can view the movies and more about what2020欧洲杯小组赛 movies are coming out and how much people want to see them.

According to a previous article by Business Insider, in the summer of 2016, blockbuster sales were flat with the previous year's sales of $4.49 billion. Attendance was expected to amount to 513 million, a 3.5% fall from 2015. 

According to the same article, PostTrak found that from 2014 to 2015, the number of people who would go to movie theatres and decide what to watch on-site had decreased from 32% to 28%, as cited in the .

Major streaming services have come out with smash hits of their own.

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The cast of "Marriage Story" attends the New York premiere at Paris Theater on November 10, 2019.
John Lamparski/Getty Images

Netflix's "Marriage Story" and "The Irishman" both received Oscar nominations. In a nostalgic nod to film history, Netflix even rented out the historic single-screen Paris theater in New York City to show "Marriage Story."

2020欧洲杯小组赛However, while streaming is now dominating the film industry more than ever, movie theater giants continue to claim that streaming availability hasn't impacted attendance. 

"Everyone has a kitchen, but everyone still goes out to eat," Charles Rivkin, CEO of the Motion Picture Association of America, , quoting Sterling Bagby, the late co-founder of B&B Theatres.

The coronavirus pandemic has caused many movie theaters to close, and it's unclear how many will reopen, when, or what the future of movie-going holds.

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A sign stating that an AMC theater is closed.
Bill Tompkins/Getty Images

Some films slated for theater release were made available on streaming platforms. However, a majority of films have simply postponed their theatrical release dates, which is

2020欧洲杯小组赛"We haven't seen a movie go to streaming that was expected to be a blockbuster," Shawn Robbins, chief analyst at BoxOffice.com, told .

2020欧洲杯小组赛Movie theaters are expected to be closed nationwide until at least mid-June as a result of the coronavirus pandemic, which has left movie theater giants like AMC, Regal, and Cinemark to figure out what they should do with their biggest summer releases.

If theaters in the US follow similar guidelines to ones abroad, the movie-going experience could look vastly different.

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Customers wearing protective masks inside a movie theater after the Czech Republic lifted restrictions allowing cinemas to re-open on May 11, 2020.
Gabriel Kuchta/Getty Images

2020欧洲杯小组赛According to , three high-profile films are still on the calendar for this summer: Christopher Nolan's thriller "Tenet" coming out July 17, Disney's live-action "Mulan" premiering July 24, and "Wonder Woman 1984," which comes out August 14.

However, summer releases will heavily depend on whether major cities like Los Angeles or New York City will allow it considering social distancing and public health restrictions.

"You can either wait for New York or LA to open, which constitute upwards of 25% of a movie's gross, on average domestically, or you can go the village roadshow route and hope the film performs in states where local governments allow theaters to be open," Jeff Bock, senior box-office analyst at Exhibitor Relations, told Business Insider.

2020欧洲杯小组赛"It's a lot of money to commit to upfront not knowing if audiences are going to show, or if there's enough consumer confidence to get people out of their boxes at home and into the theatrical boxes."

Bock also explains that adult-leaning movies like "Tenet" may go to theaters as viewers would be "old enough to make their own decisions," but that it's still a major risk for the studios to launch any big films with only theatrical releases given the current climate.

Entertainment studios may pivot partially — or even entirely — to the video-on-demand model for its 2020 or 2021 releases.

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"Trolls World Tour" proved the success of video-on-demand in the coronavirus era.
Dreamworks

2020欧洲杯小组赛"We haven't seen a week where that hasn't been a big shift in the release calendar," Bock said.

2020欧洲杯小组赛However, tensions between AMC Entertainment and Universal, one of the biggest film studios in the world, reached a boiling point when Universal suggested it would change its business model — even after the pandemic — to include both theatrical releases and video-on-demand releases after its successful release of "Trolls World Tour."

2020欧洲杯小组赛"This radical change by Universal to the business model that currently exists between our two companies represents nothing but downside for us and is categorically unacceptable to AMC Entertainment," AMC CEO and president, Adam Aron, . In the letter, Aron also announced his venues would ban Universal's movies.

2020欧洲杯小组赛The studio responded: "Our desire has always been to efficiently deliver entertainment to as wide an audience as possible. We absolutely believe in the theatrical experience and have made no statement to the contrary."

"Everybody's hurting, but there is money for the taking," Bock said. "Hopefully, they can figure something out that appeases both studios and theaters."

However, as the coronavirus pandemic stretches into the summer months, it's possible that many movie theaters nationwide will not survive.

empty movie theater parking lot minnsesota
The empty parking lot at the movie theater since it closed due to the coronavirus pandemic in Mounds View, Minnesota.
Michael Siluk/Education Images/Universal Images Group/Getty Images

2020欧洲杯小组赛"We should be a month into summer blockbusters, and we don't even know if they're going to show up this summer," Bock told Business Insider.

According to , AMC Entertainment's stock price fell 58% in the first half of March, while Cineworld, which owns Regal Cinemas and is planning to buy Canada's Cineplex, fell nearly 76%. Cinemark's market value also dropped by 68%.

2020欧洲杯小组赛"This could be a 'three steps forward, two steps back' situation with releases coming out and then studios reassessing as they go," Bock said. "The question is, is Hollywood going to risk huge blockbusters in doing so, or will they try smaller films that they can have a plan B for?"

2020欧洲杯小组赛"It's hard to be 100% sure that it's going to be successful given the state of movie theaters, the state of the industry, and the state of America," he continued.

However, drive-in movie theaters are seeing a surprising resurgence in popularity.

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People arrive for a movie at the Warwick Drive-In on the first evening that the theater was allowed to re-open on May 15, 2020, in Warwick, New York.
Spencer Platt/Getty Images

2020欧洲杯小组赛Today, some 500 drive-in movie theaters are still operational, according to .

Due to movie theater closures nationwide as a result of the coronavirus, drive-in movies are becoming increasingly popular as an entertainment option in the age of social distancing.

However, if drive-ins are to cooperate and work with the biggest studios in the industry, Bock explains it will have to be the "right movie."

"'Wonder Woman 1984' could be an interesting play. They could release it in the more than 300 drive-ins across the country," Bock explained. "It is possible that if 'Wonder Woman' plays all summer long in these packed drive-ins, and some movie theaters will open, and then if that doesn't work Warner Brothers could switch to video-on-demand."

"It could make a huge amount of money — there are people that would go out and see it, and there are people that would pay $30 to see it at home," Bock said. "If 'Wonder Woman' pops up in July, it could play until December ... there's nothing more American than 'Wonder Woman.' Her saving theaters, or just being out there this summer, will give a lot of people hope."

SEE ALSO: THEN AND NOW: Photos of mall food courts through the years show the decline of the American mall — and how the coronavirus has turned them into ghost towns

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