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Should movie tickets be priced based on demand?

Marketplace Staff Apr 28, 2011

Should movie tickets be priced based on demand?

Marketplace Staff Apr 28, 2011

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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