Should movie tickets be priced based on demand?

People watch a movie at a movie theater.

Jeremy Hobson: If you're planning on heading to the movie theater this weekend you'll pay about 5 percent more on average than you did last year for the ticket. The average price around the country is now more than $8 dollars, according to the national association of theater owners.

And LA Times Consumer Columnist David Lazarus thinks that is wrong. He joins us now. Good morning.

David Lazarus: Good morning.

Hobson: So you've got a problem with the ticket prices that we're paying. What's the problem?

Lazarus: Well let's not say it's a problem with the ticket prices, per se. I've got a problem with the movies that are being released -- most of them just aren't very good! But I still love going to the movies, so the question here is: Is is possible to price tickets in a way that is reflective of demand for the film? And this isn't a breakthrough idea, because Ticketmaster has just announced they're going to this with concerts and sporting events, whereby the demand for the tickets is going to adjudicate how much they're going to cost. So a Lady Gaga ticket -- lots; the Osmond Brothers reunion tour -- not so much.

Hobson: Wouldn't pay so much. Is there any chance of something like that happening with movie tickets?

Lazarus: Well, you know, it could be. I mean, look at the economics of this right now: many tickets, at least here in Southern California, can cost over $10; nationwide average about $8. A family of four drops about $60 when they go to the movies. That's a big chunk of change, especially at a time when everyone's got a widescreen TV and a Netflix subscription. So it kind of changes the economics of it. So why not price movie tickets according to the demand?

Hobson: Well isn't there a possibility, if that were to happen, that we would end up paying more than the $10 that we pay now for a movie?

Lazarus: Yes, indeed. And that's a good thing because it's an incentive for the movie studios to put out good quality fare. For example, would I have paid, say $20 a ticket, to go see "Avatar" in 3-D? You betcha. I thought that was a terrific cinematic experience. The other day, though, I saw "Sex and the City 2" on HBO -- I feel terrible for anybody who saw that stinker in a movie theater for top dollar.

Hobson: You wouldn't have paid $20 for that one?

Lazarus: Not a chance! But, had it been priced at $6, $7 because of lower demand for these tickets? Yeah, maybe I would have gone to see it on the big screen.

Hobson: Well we'll see if your perfect world for movie tickets comes true. L.A. Times consumer columnist David Lazarus, thanks as always.

Lazarus: Thank you.

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I've managed a three screen movie theater for six years, the idea of charging different rates for different movies is ridiculous. First, who decides what films deserve to have a higher rate? What classifies a movie being better than another? People's personal taste vary from film to film.

Second, why use a demand driven movie ticket as an incentive? There is already an incentive for movie studios to produce better quality films. As you may know, movie studios take 45-75% of ticket sales. It's already an incentive for studios to produce films that draw more of an audience.

Finally, I want to know where you got that statistic for $8.00 per ticket. Can you be more specific about the ticket price - Matinee, adult evening, senior, student, military, second-run "dollar" theater, or all of the above?

I own a single screen movie theater in Berkeley Springs, WV -- the Star. We show one movie a weekend, one show F,S & S nights. We charge $3.75 for movies about a month out of release. Lots of folks see movies they would not pay $10 to see.

Okay, I may be half asleep in traffic when I listen to the morning report, but I'm not THAT out of it! This story was just dumb, and David Lazarus needs to stop giving any kind of economic advice and stick to consumer reporting. If people like Lazarus didn't go and watch crappy movies in the theater, guess what? They wouldn't charge as much for the tickets. As long as not all of us are absorbed with out Netflix accounts, we will all have to be more choosy at the cinema to justify that $10 tub of popcorn.

I think that result in more movies aimed at teenage boys and fewer aimed at anyone else. The movie industry already needs to maximize profit so why take a change of making a movie with a guaranteed lower profitability?

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