According to industry insiders, there are signs that the multiplex boom which revitalised the Hungarian exhibition industry over the past five years is grinding to a halt.
There are now 12 multiplexes in the country, which has a population of 10 million, but the rapid growth that saw admissions in Budapest rise from 5.6 million, when the first multiplex opened there in 1996, to 7.6 million in 1999 and 8 million in 2000, has now reached a plateau.
"The market in Budapest is saturated," said Andras Kalman, head of Intercom the country's largest distribution and exhibition outfit, which runs its multiplexes in partnership with Village Roadshow as Hollywood Multiplex. "Admissions (in Budapest) have stopped rising over the past year and in the country overall they are actually falling."
According to Kalman a recent Intercom study shows that the audience is actually shrinking. In Budapest, with a population of 2 million, only 300,000 people make up the audience, while in previous years it was as high as 500,000. Increases in ticket prices - from $1.25 (360 forints) in 1996 to $2.95 (850 forints) in 2001, as well as a hike in the cost of living, has alienated a substantial portion of the audience.
The growth in multiplexes has been driven by the construction of shopping centres that has swept across Hungary over the past five years with each site incorporating a food and entertainment centre. But while the local ticket price has risen, the falling exchange rate has meant that ticket prices have remained constant at about $2.50.
"The costs for distributors are largely in forints," says Kalman, "but the investment in multiplexes is in dollars and must be recouped in dollars, putting the developers in a difficult position. We can win back the audience if we decrease the ticket price, but then we lose at the box office, it is a catch 22 situation," said Kalman.