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EMAC 2024 Annual


Is Streaming Killing Movie Theaters? Quantifying the Effect of the Availability of Subscription Video-On-Demand Services on Movie Theater Attendance
(A2024-118723)

Published: May 28, 2024

AUTHORS

Paul-Vincent Mayr, Chair of Marketing & Media | Westfälische Wilhelms-Universität Münster; David Jütte, University of Münster; Thorsten Hennig-Thurau, University of Münster; Alina Marie Herting, University of Münster

ABSTRACT

The emergence of subscription video-on-demand (SVOD) services such as Netflix and Disney+ has sparked an intense industry debate about their potentially destructive effect on the movie theater industry. While some theater managers regularly blame SVOD for the continuous decline in theater attendance, others argue that SVOD may actually be a beneficial and complementary form of entertainment for the theater industry. This research addresses this pivotal industry discussion by examining the impact of SVOD on theater attendance. Using fixed-effects panel regression and a unique dataset that combines theater-level attendance with broadband accessibility over a 10-year time frame, this study shows that the availability of SVOD services is indeed responsible for a substantial decrease in theater attendance. Furthermore, this study highlights the supportive internet infrastructure as well as manageable theater characteristics as potent contingency factors of this substitution.