Why “Premium Pricing” for the New ‘Star Wars’ Is a Horrible Idea

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Two summers ago, Steven Spielberg and George Lucas appeared at an event at USC, warning Hollywood that blockbusters were taking over. It was a little, teeny, tiny bit comical coming from the two men who basically created the modern blockbuster, and Spielberg’s warning that “there’s going to be an implosion where three or four or maybe even half a dozen of these mega-budgeted movies are going to go crashing into the ground” certainly hasn’t slowed the tide of mega-budgeted movies. But one of Spielberg’s other worrisome predictions is finally getting some airtime.

The undercurrent of the Spielberg/Lucas talk was how hard it is now to get studios to finance “really interesting, deeply personal — and even maybe historical — projects,” like the then-recent Lincoln, which Spielberg nearly had to take to TV. It made it to theaters, but he imagined a scenario where it would come as second-class goods: “eventually there’s going to be a price variance. You’re going to have to pay $25 to see the next Iron Man. And you’re probably only going to have to pay $7 to see Lincoln.”

Over the holiday weekend, at the finance site Seeking Alpha, an “occasional investor” named Steven Mallas decided the time had come for such a move. In a post for the site, linked and dubbed “provocative” by Variety , Mallas made this proposal:

Disney management, in consultation with the major exhibition chains, should still attempt to figure out ways to maximize the potential of the seventh episode in the Star Wars saga. It’s a rather special product, considering the fact that Carrie Fisher, Harrison Ford, and Mark Hamill are coming back to the big screen to play the roles that made them not only famous, but also helped to usher in a new era of blockbuster cinematic entertainment.
Here’s one way to do it: charge a higher price for tickets for the first weekend of the film’s release.

It’s worth pausing here to note the key difference between Spielberg’s hypothetical proposal and Mallas’ serious one: Spielberg’s was a warning, a dire prediction, a doomsday scenario. Mallas, on the other hand, seems to see this as just good business. “I know how that sounds,” he writes. “Greedy; inadvisable; insane. Nevertheless, I stick by the suggestion.” Which, of course he does, he’s a soulless finance dude.

Look, there’s no shortage these days of people writing goofy shit about Star Wars. (/Film has apparently made it their business model.) But the asinine deep-digging within any nugget of Star Wars sequel ephemera does speak to a legitimate desire: people are over-the-moon excited about this movie, and counting the days until its December release. For a guy like Mallas, it’d be a shame to not monetize that desire — indeed, to not monetize it beyond the record opening weekend that’s all but assured for The Force Awakens. So he proposes charging “somewhere around $30 for non-3D/IMAX showings, and between $35 and $40 for the 3D/IMAX screens” for “the opening-weekend privilege” of seeing a movie, because “it would seem obligatory on the part of Disney and theater owners to do something unique with the release to maximize the gross.”

To be clear, the bells and whistles mentioned as price-points are already “premiums” that studios are using to pad the gross — but at least you can scope out showtimes or theaters that aren’t offering them, and save the cash there. (In most markets, discount matinees are also an option.) But if the time and location doesn’t work out, you can already find yourself paying $20 or more per movie ticket here in New York — where, presumably, such “maximize the gross” tickets would also cost more than the rest of the country.

You know what else you can do in New York? Go see a Broadway play — if you’re rich. The current average ticket is well over $100, with the top-priced tickets running nearly $300 (or, in the case of The Book of Mormon, nearly $500). This wasn’t always the case; back in 1955, when the hot ticket was My Fair Lady, balcony seats averaged $2.30, orchestra $4.90. (That’s $20.48 and $44.34 in today’s dollars.) But the explosion of prices for Broadway shows, concerts, and other live events has rendered movies — in spite of their own insane ticket upticks — one of the few genuinely affordable entertainment options. It’s a populist art form, and creating this kind of tiered, rich-people-first system of movie-going is a betrayal of the entire experience.

But that’s not what this is all about:

Disney and theater owners should attempt to do something, though, so as not to leave too much money on the table. At the very least, there should be no matinee prices or other forms of discounting for the first weekend. Disney owes its shareholders that much.

Maybe this is just wishful thinking among number-crunchers, from a writer who is — sit down and brace yourself for the least surprising disclosure of all time — a Disney shareholder. But slapping a “premium cost” on movie tickets for the “the opening-weekend privilege” of seeing a film they’re dying to see is (on an admittedly less tragic scale) like price-gouging at gas stations and hotels after a hurricane: something you could do, which would certainly make a lot of money because it’s something people want. But you’d kinda have to be an asshole to do it.

Yet the most depressing part of the whole story isn’t that someone like Mallas is floating such an idea; it’s that you can bet good American money that, somewhere in Hollywood, a printout of that article is on a Disney executive’s desk, prompting some serious discussion.