Box office revenues in Central and Eastern Europe are forecast to soar by 80% over the next four years, notwithstanding the increasing problem of overscreening in many key cities as well as consolidation among some international exhibitors.
According to a new report, Cinemagoing: Central and Eastern Europe, published by film industry consultants Dodona Research, higher ticket prices and increased admissions will push the region's box office up from US$160 million in 2000 to US$290 million in 2005.
The ten countries covered by the report have a combined population of 260 million and some 5,000 cinema screens. Many of these are dilapidated and function only intermittently, though this situation is changing steadily as the sector is modernised.
The report finds that development in Poland, Hungary and the Czech Republic was achieved firstly by the privatisation and renovation of a handful of formerly state-owned cinemas to test the multiscreen concept. This was followed by significant investment of foreign capital to build Western-style multiplexes.
While Poland and Hungary are now the region's largest markets, strong competition and heavy investment threaten to lead to rapid screen saturation in cities such as Budapest and Warsaw (ScreenDaily 16 February 2001). According to report author, Karsten-Peter Grummitt: "If cinema development gets ahead of the market, short-term profits will suffer, and there is no certainty yet as to what the long-term potential of the market is."
More positively, Dodona believes there are good opportunities in other countries of the region. Croatia and Romania have recently acquired their first multiscreen and multiplex cinemas and other countries like Bulgaria, where the government is in the process of privatising the sector, also offer some promise. With cinema renovation and multiscreening likely to prove a viable alternative to building expensive new multiplexes across the majority of cities in the region, relatively modest investments could be rewarded by high returns.