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GSTA Economic Impact Study©

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Written by: Giant Screen Theater Association
Date: July 12, 2001

  

Category: Press Releases

GSTA Economic Impact Study©
Released by the Giant Screen Theater Association®

  • In-depth study reveals an industry at the crossroads after several years of strong growth
  • Change in the economic model recommended
  • Study made available for sale

July 12, 2001 St. Paul, Minnesota - The Giant Screen Theater Association today announced the release of the GSTA® Economic Impact Study©, a comprehensive examination of the quantitative and qualitative factors that affect how large format (LF) films are produced, distributed and exhibited.

The large format industry has recently seen explosive growth with the number of theaters around the world nearly tripling in the past 10 years. Similarly, in the past five years, the number of new film releases per year has nearly doubled.

"We’re at a huge crossroads in our industry, and whether or not this industry continues in the robust fashion of the past will be determined within the next three years," predicts Greg MacGillivray, president of MacGillivray Freeman Films, producer of such LF hit films as Everest and the Academy Award“ nominated Dolphins.

Development of the industry beyond its non-profit institutional base of museums, science centers and other educationally-oriented organizations to one that has included many of the major commercial theater chains has brought the industry to new heights as well as to concerns for the future direction of the industry.

Following its 2000 annual conference, the GSTA, its education, liaison and research committee and several leading member organizations commissioned a study to look at the current financial model of the industry and the economic factors affecting the future availability of large format educational films. A listing of the Study sponsors is attached.

The GSTA also sought practical recommendations based on the Study’s findings that could be implemented by GSTA members individually and collectively to improve the financial model for the overall benefit of the industry.

"This Study was a first attempt to understand the current film market and to more accurately predict trends for future growth," said GSTA President, Truett Latimer. "The bottom line: There is a market, but who will serve it? There is no doubt the demand exists for quality films. But the industry is faced with slimmer profit margins, due to an increase in the number of films; a decrease in valuable film product, and a glut of films which don’t meet the needs of the institutional market."

Not only does the Study make recommendations to individuals already involved in the industry, Mary Ann Henker, GSTA Executive Director states, "The Study is an excellent tool for those that are interested in entering our industry either as an exhibitor or producer. The Study clearly outlines, in great detail, the special economic issues that affect all in the industry and makes recommendations on how to work best within and change the economic model."

Findings of the Study include:

  • The current economic model indicates a disproportionate risk/reward ratio between producer and exhibitor.
  • The definition of what constitutes an educational film and whether a film must be 100% historically/scientifically accurate to play at LF theaters indicates that it is in the eye of the beholder.
  • A sharp difference opinions appears concerning whether institutional and commercial theaters can co-exist, with 53% of respondents indicating yes, 27% indicating maybe and only 5% responding negatively. 15% of respondents replied "other."
  • Few of the large format films take adequate advantage of the ancillary markets, primarily home entertainment, in the distribution of their films.
  • The LF industry is in a correction, or transitional, phase. A change to the basic economic model is needed in order to allow the educational film market to survive and more importantly, to continue to grow.

Commenting on the Study, co-author Marty Shindler of Calabasas, CA based The Shindler Perspective, Inc. stated, "articulating and rationalizing the many differences of opinion and points of view was a challenge. The final report, including the quantitative analysis, presents a fair representation of the current state of the large format industry."

Among the recommendations from The Shindler Perspective designed to provide an economic stimulus:

  • Change the box office allocation formula, providing more revenue to producers, thus creating in theory more funds for future productions.
  • Work with vendors to negotiate better pricing on large purchases, with prints being one of the hottest topics in the Survey.
  • Work toward more day and date releases to allow all theaters the opportunity to gain from the exposure created by more national and regional publicity campaigns.
  • Maximize revenue across all distribution windows. The financial results prove that the ancillary markets are crucial to a film’s financial success.
  • Consider revisiting the institutional mission statement in order to be more flexible in its interpretation. Regard films as an opportunity to bring people into institutions that might not otherwise come.

"We believe that this study has a lot of merit in helping our industry understand the current economic climate more truthfully rather than anecdotally," says Mark Katz, president of distribution at nWave Pictures.

The Giant Screen Theater Association is a nonprofit association dedicated to the worldwide growth of the giant screen film industry by supporting the developers and presenters of these film experiences. Founded in 1977, GSTA is the oldest and largest international association serving the giant screen film industry. The goal of GSTA is to be the global forum for producers, operators and suppliers of the giant screen film industry and to foster its growth and development in presenting entertaining film experiences for lifelong learning to the educational and commercial sectors. GSTA headquarters is located in St. Paul, MN, USA.

The report is available to members in the "members-only" section of the GSTA web site. Members may purchase a printed copy for $295 and non-members may receive a copy of the Study for $495. For information about GSTA and to order a copy of the Study, contact Mary Ann Henker at maryann@giantscreentheater.com or 651.292.9884.

For additional information on the GSTA Economic Impact Study, contact Marty Shindler at Marty@iShindler.com or 818.223.8345.

For distribution problems with this release, call Marian Calvin at Marketing Resource Associates at 330-425-7002.

GSTA Economic Impact Study© Sponsors

The Giant Screen Theater Association would like to express its grateful thanks and acknowledgement to the following whose financial support made the GSTA Economic Impact Study possible.

Organization
Name


Cincinnati Museum Center
Dave Duszynski

Destination Cinema
Bud Rockhill

Fort Worth Museum of Science and History
Don Otto

Giant Screen Theater Association

Houston Museum of Natural Science
Truett Latimer

Liberty Science Center
Emlyn Koster

MacGillivray Freeman Films, Inc.
Greg MacGillivray

Museum of Science, Boston
David Ellis

Museum of Science and Industry
David R. Mosena, John Wickstrom

National Wildlife Productions, Inc.
Christopher N. Palmer

NOVA/WGBH Enterprises
Mary Kaye Kennedy

nWave Pictures Distribution
Mark E. Katz

Primesco Communications, Inc.
Goulam Amarsy

R.H. Fleet Science Center
Jeffrey W. Kirsch

Science Museum of Minnesota
Mike Day

Science North
Jim Marchbank

SK Films, Inc.
Jonathan Barker

Tech Museum of Innovation
Peter Giles

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