A slow and steady uptick in box office receipts could be threatened by a new coronavirus variant.
Since March, the domestic box office has gained steam, recently tallying as much as $98.7 million in ticket sales over the course of last weekend, a record during the pandemic era.
Around 80% of movie theaters are open to the public this weekend and mask restrictions have been loosened for those that have received the coronavirus vaccination. As cinemas have continued to reopen and Covid cases have declined, studios have been confident in releasing major blockbuster pictures.
Last weekend, Universal’s “F9” tallied the highest opening weekend of any film released during the pandemic with a $70 million haul, and helped boost the total weekend haul to $98.7 million, another record for the industry.
More than half of the U.S. population has received at least one dose of the vaccine, which has led to a sharp drop in the number of deaths from Covid, according to the Centers for Disease Control and Prevention. The number of new cases had declined significantly in recent weeks, and remains sharply below its peak. However, public health officials are watching the spread of the highly contagious delta variant in communities with low vaccination rates, which has driven a recent increase in cases.
The fear is that an increase in delta variant cases could lead to a resurgence in health and safety restrictions not just domestically, but internationally and deter global moviegoers from heading to the cinema.
Already, cities like Los Angeles, have opted to reverse mask guidelines, strongly recommending that both unvaccinated and vaccinated people wear masks inside public places like restaurants, shops and movie theaters. Movie theater chains have told CNBC that cinema locations will continue to adhere to all local mandates.
“Every state is relaxing the mask strategies so if there is a flare up then a lot of businesses could be impacted,” said Eric Handler, media and entertainment analyst at MKM Partners. “I’m hoping that the vaccines can help fight it off enough so it’s not a major issue.”
CDC Director Rochelle Walensky said Wednesday that the U.S. has a strong vaccination rate and its highly effective vaccines have enabled it to loosen mask restrictions and social distancing measures. In comparison, much of the world remains unvaccinated and evidence currently suggests that vaccines developed outside of the U.S. have been less effective.
“The global outlook also remains important as studios and exhibitors are closely watching key international markets and how their varying vaccine distributions play out in the second half of the year,” said Shawn Robbins, chief analyst at Boxoffice.com.
In some countries where the delta variant is gaining ground, new lockdown measures have been imposed.
The delta variant currently makes up about 25% of sequenced new cases in the U.S., and officials say they expect it to become the dominant strain in the country. In some counties, delta variant rates are as high as 50%, according to the CDC.
The U.S. government is concerned about pockets of the U.S. where vaccination rates are low. Domestically, about 1,000 counties in the United States have vaccination coverage of less than 30%, Walensky said Thursday. These counties are mostly located in the Southeast and Midwest and are most vulnerable to Covid infection, she said. The agency is already seeing increasing rates of disease in these counties due to further spread of the more transmissible delta variant.
“The movie industry, like many others, has been factoring in variant scenarios similar to the current one as part of reopening plans for quite some time and nothing is being taken for granted,” Robbins said. “At this time, though, there isn’t any indication of imminent impact on domestic cinemas so long as vaccinated individuals remain protected as health officials have widely reported.”
— CNBC’s Rich Mendez contributed to this report.
Disclosure: Comcast is the parent company of NBCUniversal and CNBC. NBCUniversal is the distributor of “F9.”
Source: Business - cnbc.com
