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Revenge of the Multiplex
In the last several years, a small group of investment firms—uncharitably called "vulture" investors because of their penchant for troubled assets—have bought up nearly one-third of the 35,000 movie screens in the United States, with 44 percent of its box office revenues. They made their Hollywood entrance after ill-advised expansion programs during the 1990s left four of the six major theater chains in bankruptcy and vulnerable to savvy financial investors.
The take-away: Now Hollywood movie studios are the ones feeling vulnerable: more consolidation is likely, giving the emerging megachains the clout to demand a greater portion of ticket-sale revenues and to influence how—or even whether—the industry shifts to digital cinema, as the studios would like.
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