The worldwidetheatrical marketplace was worth an unprecedented $20.5bn in ticket sales forthe US studios and their affiliates, declared MPAA chief Jack Valenti on theopening day of ShoWest exhibitors' convention in Las Vegas.
With worldwideadmissions dropping 5% last year, Valenti also acknowledged that thisrecord-breaking dollar figure came as a result of rising ticket prices ratherthan any underlying improvement in the theatrical business. He attributed at least partof that admissions decline to the scourge of piracy
Continuing a trend that began a few years ago, the lion's share ofthat global take went once again to the international box office, which wasworth $10.85bn to Hollywood's satellite distribution operations.
Valenti said that the 2003 international cumulative represented a5% rise in dollar terms over the year before and accounted for 53% of all boxoffice receipts last year.
By extension, the North American box office was worth around$9.6bn, although more details will be forthcoming when Valenti delivers hiscustomary state-of-the-industry address on Tuesday morning at ShoWest.
The burgeoning international market and the ongoing fight againstpiracy were the key points to emerge from Monday's morning presentations by bothValenti and president of distribution at Warner Bros Pictures International,Veronika Kwan-Rubinek.
While neither speaker said it explicitly, the volley of generalfigures and trumpeting of growth markets in China and Russia sent a clearmessage that the international side of the industry can no longer be regardedas the poor relation to its domestic counterpart.
By far the largest component of that international box office isEurope, which accounted for 51% of the $10.85bn total following a 13% regionalincrease last year. Canada accounted for 6% and increased by 15%, while LatinAmerica represented 7% and fell by 12%.
The biggest anomaly remains Asia Pacific. The regionaccounts for a whopping 80% of all international admissions, but lowticket-prices means that Asia Pacific still only represented a flat 35% of theinternational marketplace last year.
In 2003, seven US pictures grossed more than $250m at theinternational box office and the top five US titles were also the top fiveinternational performers, namely Finding Nemo, Pirates Of The Caribbean, The Lord Of The Rings: The TwoTowers and The ReturnOf The King and TheMatrix Reloaded.
Valenti added that the studios had seen an increase in theatricalbox office receipts in 15 of the US' 19 biggest global markets, while only fourexperienced a drop.
Kwan-Rubinek said overseas was the "nexus of growth for the filmindustry" and pointed out that all but one of the top 25 international films oflast year passed their US gross.
She remained optimistic about growth in China, which she describedas a "provocative and challenging" territory but one that remained elusive for foreigndistributors because only 20 pictures are allowed to be imported on a revenuesharing basis each year. Moreover, the country has less than 1,000 screens despite an urban population that exceeds the entire American populace.
The recent relaxing of foreign theatre ownership rules wasexpected to open up the market, as are stronger anti-piracy efforts and thefact that the Chinese government is considering a ratings system that it isbelieved will increase levels of imported and domestic titles.
Kwan-Rubinek, whose division at Warner Bros has overseen massiveinternational success with The Last Samurai and the Harry Potter and Matrix franchises, said Russia was a"tremendous growth story".
The country registered a record $190m in revenue last year and,with no quota restrictions on foreign imports, Russia's impending WTOmembership and indications that admission levels had virtually doubled everyyear for the past two to three years, she projected box office to hit $400m by2007.
On the subject of piracy, both speakers argued for greaterinter-agency cooperation, legislative lobbying and stricter enforcement, withRussia and China singled out as areas of acute illegal activity.
Kwan-Rubinek said piracy was responsible for a 12% drop inEuropean admissions last year, adding that the UK alone loses $120m each yearto piracy and experienced its first revenue drop in six years of 6%. Inaddition 30% of DVDs in the UK are counterfeit.
In Warner Bros' second biggest market of Germany projected lossper year is more than $100m for hard goods piracy with pirates in general nowcapable of illegally recording, manufacturing and packaging a counterfeit DVDin 24-48 hours.
"Day-and-date releasing offers a legitimate protection throughsimultaneous or near simultaneous release with the US, through which we canreduce theatrical loss to piracy and we can combat it when piracy is mostdamaging during the first few weeks of release in the US."
Valenti sounded a more realistic note compared to the zealousanti-piracy bombast of last year when he said, "I cannot say we can abolishpiracy just any more than you can abolish crime or poverty, but we can bring itdown to acceptable levels."