4 Summer Movie Alternatives To The Multiplex

PORTLAND, Ore. (TheStreet) -- Welcome to summer blockbuster season, movie fans. Sit back and enjoy the gouging.

Listen, there's no question this is a lucrative time of year for movie studios, and getting more lucrative with each warm-weather slate of blockbusters. Back in summer of 2002, when Sony's original recipe Tobey Maguire Spider-Man raked in nearly $404 million at U.S. box offices, the movie industry as a whole squeezed summer patrons for nearly $3.6 billion, according to BoxOfficeMojo. A decade later, with Disney's ( DIS) The Avengers at the top of the heap with $623 million in box office receipts last year, the summer movie industry swelled to a $4.3 billion affair.

Yet, in the bigger picture, those numbers are strictly OK. In 2002, 3-D and IMAX ( IMAX) weren't squeezing every potential dollar out of movie audiences. In fact, the industry only produced 157 movies in summer 2002 compared with the 221 it released last summer alone. The blockbusters and more benign arthouse releases of summer 2002 averaged $22.9 million apiece, compared with the relatively scant $19.5 million a pop brought in by the films of summer 2012.

The sad truth that gigaplex owners have been dealing with for some time is that fewer people are going to see their movies overall. In 2002, the movie industry sold 1.576 billion tickets with Spider-Man leading the way. By last year, even The Avengers and Batman couldn't make Americans buy more than 1.36 billion tickets. That's up from the 1.28 billion sold in 2011, but still part of a steady decline.

So what's wrong? Is it really just high definition, Blu-ray and $8-a-month streaming sucking away customers? A little. In the past decade, the average price of a movie ticket in the U.S. rose to $7.96 from $5.81. That's average; folks plunking down $20 for 3-D showings or $14 just to get in the door of big-city multiplexes know it's far worse.

That high price of entry is also shrinking moviegoers' options. As the movie industry forces a switch to all-digital format from film, small theaters are forced to either make costly upgrades just to keep up or bow out altogether. As a result, the 5,712 theaters that existed in the U.S. in 2002 have dwindled to roughly 5,300 even as the number of screens expanded from 35,000 to nearly 39,000, according to the National Association of Theater Owners. Regal ( RGC), AMC, Carmike ( CKEC) and Cinemark ( CNK) face their own struggles, but still fare better than their smaller competitors.

Still, those smaller competitors are out there and still giving moviegoers a viable and, in some cases, cheaper alternative to the multiplex. Here are just five other options for summer movie audiences this season:

Drive-Ins

We're going to be as kind about this as possible: Drive-Ins aren't dying off wholesale, but it's not looking good, either.

At one point, there were 4,000 drive-in theaters across the country, according to DriveInTheater.com. Rising real estate values and shrinking audiences have since whittled that to just 368 last year, according to the National Association of Theater Owners.

Even worse, the Los Angeles Times reports that 90% of those drive-ins haven't converted to digital projectors and may not have the capital to spend the $70,000 per screen for each devices. As a result, Time? found that numerous drive-ins have turned to fundraising site Kickstarter, Facebook ( FB) and their own sites to solicit donations for projectors and potentially save their businesses.

The remaining American drive-ins have survived by getting creative. Tinny or nonfunctional window speakers have been replaced by radio signals. The M-F Drive-In in Milton-Freewater, Ore., still charges by the carload, while the Warwick Drive-In in Warwick, N.Y., just north of New Jersey offers free Wi-Fi.

They'll appreciate your business this summer, but may need a donation if you want to visit again in 2014.

Second-run theaters

In just as much trouble as their drive-in counterparts, these $1-to-$4 theaters are getting squeezed from all sides.

Cinema Treasures keeps tabs on more than 300 such theaters across the country, but there are untold others just scraping by. Video-on-demand services from Comcast's ( CMCSA), Time Warner Cable ( TWC), DirecTV ( DTV), Dish Network ( DISH) and others keep encroaching on their release schedule. On-demand streaming services from Amazon ( AMZN), Apple ( AAPL) iTunes and Wal-Mart's ( WMT) Vudu have also turned up the pressure.

Now, as Indiewire noted last year, there's a chance 1,000 theaters -- many carrying second-run movies -- will close their doors for good. The North American Theater Association estimates that 20% of theaters in America -- or 10,000 screens -- won't make the conversion and will go dark.

That leaves the rest to find a way to convert or close. While discount theaters remain a bargain that still undercuts the price of on-demand services, it's going to take something bigger to keep them alive and relevant. That leads us to ...

Theater pubs

There are vastly different takes on this idea throughout the country, but the basic premise is the same: Provide dinner and booze with the movie and people will stick around.

On the East Coast, this idea exists as Showcase Cinemas' Cinema de Luxe. At a string of theaters in Massachusetts, a Lux Level of plush seats is equipped with a server call button that brings an attendant over to take your order for appetizers, burgers, entrees, desserts, wine, beer or cocktails. Showcase has stocked other locations with its Studio 3 bar for pre- and post-movie noshing and boozing and its Chatters Bar & Grill for more downmarket fare.

Smaller theaters, including the Dunellen Theater & Cinema Cafe in Dunellen, N.J., dispense with the formalities and offer moviegoers pizza and beer at tables between rows. It's an idea that's caught on from Massachusetts to Alaska, but has become ingrained in the culture in Portland, Ore. Not only is the city and the surrounding suburbs home to the McMenamins chain of theater pubs that includes the palatial Baghdad Theater and the converted Kennedy School elementary school, but it's also teeming with similar, smaller independent theaters such as the neon-covered Laurelhurst, the cozy St. John's Cinema, cult favorite Clinton Street and the armchair-laden arthouse known as Living Room Theaters.

Some will cook you pizza, others will offer deviled egg plates and panini, but all have beer on tap and wine if you want it. Kids are invited to most during the day, but knowing you can go to a kid-free showing of Wreck-It Ralph after 8 p.m. and enjoy it with a pint of porter is oddly comforting.

First-run movies at home

If you just want to surrender and accept the fact that multiplexes are taking over and the chatty, smartphone-lit experience they provide is prohibitively grating, maybe it's best not to leave the house.

If you hate other people's noise and idiosyncrasies enough to pay your way out of it, however, Prima Cinema is more than willing to take your money in exchange for cinematic peace. For $35,000, the company will give you a digital box that delivers films over the Internet and into your home theater.

Those films cost $500 a pop and you can watch them only once during a 24-hour span, but it's already showing Fast and the Furious 6 and has Kick-Ass 2 and Despicable Me 2 coming soon. Granted, because it's a partnership between Comcast's Universal Pictures, a venture capital firm and Best Buy's ( BBY) investment group, your choices are going to be somewhat limited. Oh, and setting up a home theater that would make the experience worthwhile could run you six figures even without the Prima box.

That said, you'd still be among an elite few outside the Bel-Air courier route of studio execs, producers, actors and other industry types who'd have legal access to first-run films while they're in theaters. It's not cheap, but it definitely comes with more bragging rights than watching Iron Man 3 for $3 bucks three months after its release.

-- Written by Jason Notte in Portland, Ore.

>To contact the writer of this article, click here: Jason Notte.

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Jason Notte is a reporter for TheStreet. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, the Boston Herald, the Boston Phoenix, the Metro newspaper and the Colorado Springs Independent. He previously served as the political and global affairs editor for Metro U.S., layout editor for Boston Now, assistant news editor for the Herald News of West Paterson, N.J., editor of Go Out! Magazine in Hoboken, N.J., and copy editor and lifestyle editor at the Jersey Journal in Jersey City, N.J.

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