3D Puts a Premium on Pic Tix Abroad

Whether it's Madrid, Moscow or Montevideo, moviegoers outside the United States can routinely expect increased ticket prices -- especially now that 3D is becoming commonplace. According to internal estimates from one studio, the current premium for 3D tickets is a stunning 44% in international markets, with the average ticket price running $11.38, vs. $7.93 for a 2D admission.

That premium has generated more than just a ripple in box office takings, with the number of foreign screens capable of showing 3D films proliferating. During the past year, that screen count rose from about 1,000 to more than 5,500.

The highest premium is in Singapore, where the price of 3D moviegoing is $8.35 -- more than double the average of a 2D price. Not surprisingly, the highest 3D prices are in Japan, at $18.93, and in Sweden, at $16.43. The Japanese premium is 39%, while the Swedish figure is 34%. The low end of the premium boost is in Australia, the foreign market that tends to most closely mirror the United States. The average 3D price as of February in Oz was $13.95, 25% higher than the $11.17 average ticket price for a 2D venue.

The foreign price hikes are notable amid the worldwide recession, as well as a stronger dollar and weaker local currencies -- which conversely translates to Hollywood studios seeing lower revenues than they might reap if foreign economies were more robust.

Andrew Cripps, president of Paramount Pictures Intl., says the foreign premiums and price hikes are not surprising, as U.S. prices soared 8% year to year. According to the National Assn. of Theater Owners, this year's first-quarter average stands at $7.95 per ticket, with Avatar ($457.5 million) and Alice in Wonderland ($299.5 million) leading the way in reaping the benefit of the higher ducat prices.

Foreign traction for Fox's Avatar -- which has taken in almost $2 billion outside the United States -- and Disney's Alice has been remarkable. Alice has gone past $600 million overseas and could become the sixth film to hit $1 billion in worldwide grosses. The most recent 3D release is Warner's Clash of the Titans, and despite a critical drubbing and complaints from some quarters about the conversion process, the pic has done more than respectably in foreign markets, cuming $273.8 million as of May 2, of which approximately $176.1 million (64%) came from 3D. The worldwide price hikes should continue into the summer slate with additional 3D offerings -- Par's Shrek Forever After and The Last Airbender, Disney's Toy Story 3 and Universal's Despicable Me.

"I am not surprised by the numbers I read, given how 3D has really taken off," says Cripps. "We are providing the consumer with a premium filmgoing experience, and they have proven they are willing to pay more for that experience."

Cripps also notes that inflation has been generally low for the past couple of years, so much of the overall price gains are attributable to 3D.

Dodona Research analyst Karsten-Peter Grummitt believes 3D will add 4%-5% to the overall average ticket price this year (both 2D and 3D) in foreign markets -- based on assumptions of a 25%-30% premium for 3D ticket prices, with 3D repping a 15%-20% share of tickets. Grummitt says the impact last year was somewhat less than anticipated, such as in the U.K., where the average ticket price climbed just 5% in 2009 despite increases of around 25% for 3D performances.

"This compares with increases in the 3%-4% range in the previous 5 years," he adds. "We think there are two reasons: the lack of 3D-enabled screens in the first part of the year, meaning most people saw Monsters vs. Aliens in 2D, and the positive impact of premiums being diluted by wider discounting initiatives and greater uptake of discounts due to the economic situation."

Another variable: In a few markets, such as Australia, exhibitors have started charging separate fees for 3D glasses.

The run-up in pricing by foreign exhibitors isn't new. During much of the past decade, they hiked the average costs of tickets continually, mainly to recoup their investments replacing older single-screen theaters with state-of-the-art multiplexes. And foreign exhibitors are well aware that they can't nudge prices up too quickly.

"I think that there's still a lot of concern that you can't be perceived as trying to gouge the customers, particularly with there still being a recession," says one exec. "If the films aren't good, you could have a real backlash. I wish there were something like a Good Housekeeping Seal of Approval for quality of the 3D."

By Dave McNary, Variety