3D is F*cked, Basically

Slate recently published a long investigation of the financial health of 3D, and as you may have noticed from the line on the above graph that Vin Diesel could rail grind down, it’s looking pretty grim for 3D. Which is to say, great for us, because 3D sucks. First, an explanation of the graph:

The updated graph shows almost every major 3-D release since the beginning of 2009. The ratio of 3-D revenue to 2-D revenue per theater is shown on the Y-axis, and the dotted red line represents the break-even point. The trend that was beginning to take shape last summer has deepened in the last few months. (Data exclude any film that opened at fewer than 1,500 locations, and films with “3-D” in the title, which only a fool would see on a flat screen.)

The short answer is, 2D movies are earning more in head-to-head screenings.

For every movie that’s released in both 2-D and 3-D, how does the revenue from the two compare on a per-theater basis? (In other words: Which format brings in more money?) When Avatar opened in 2009, it earned about $15,800 for every theater that showed the film flat, and about $26,800 for every one that showed it in 3-D. It’s not unreasonable to suggest that the owner of an old-fashioned theater might have increased her revenue by $11,000—or 70 percent—by upgrading her equipment and showing Avatar in 3-D.

A female theater owner, haha, good one, Slate.

For all the Avatar hype, this wasn’t an exceptional figure. Pretty much all of the 3-D films released in 2009 and early 2010 were earning from 50 to 100 percent more money from 3-D than 2-D on a per-theater basis. (Some movies, like Monsters vs. Aliens and The Final Destination, more than doubled their income.) The first clear sign of danger came the weekend of June 18, 2010. Toy Story 3 opened with $110.3 million in ticket sales, making it one of the most successful films in history. Yet the Pixar movie’s 3-D screenings contributed relatively little to its dazzling profits. Their per-theater revenue was at minus-5 percent compared to 2-D showings—the first time in recent history that 3-D had sunk below the break-even point on a film’s first weekend. Six weeks later, Cats & Dogs: The Revenge of Kitty Galore opened with $12.3 million in total sales, and a 3-D “bonus” of minus-10 percent. The monster profits from 2009 had all but disappeared by the end of the summer.

Probably because 2D Pixar movies are already really good at creating the illusion of three dimensionality — you know, kind of like your f*cking eyeballs. The only thing those dumb glasses do is help you pretend you weren’t crying during the beginning of Up.

The health of the medium has only worsened. The studios have released more than two dozen major 3-D features since Cats & Dogs. A couple of those—Resident Evil: Afterlife and Tron: Legacy—seemed to benefit from 3-D showings, but the rest did not. About three-quarters of the last year’s films saw negative returns from 3-D, and many landed far below the breakeven point. The newest Harry Potter and Kung Fu Panda movies, plus Captain America and Green Lantern, saw revenue adjustments of around minus-65 percent. In other words, their screenings at 3-D theaters were making just one-third as much money as regular showings.

Part of the problem is of course, cheapening the product and hurting the brand while simultaneously raising the price. In business, this is called “Your Momening.”

Since 2010, “real” films have an average ratio of 1.00, meaning they earn about the same amount from 3-D and 2-D on a per-theater basis. The “fake” films from that period had an average ratio of 0.87, which equates to minus-13 percent. It’s also the case that fakeness is on the rise—it now accounts for about half of all 3-D releases—which could explain the general worsening of 3-D returns.

It might seem premature to suggest that stereo cinema has passed away, given that Steven Spielberg’s The Adventures of Tintin will come out this fall, along with a stereoscopic movie from Martin Scorsese and a 3-D stoner comedy with Harold and Kumar. (We’ve also got the looming juggernauts of Avatar 2 and Avatar 3, tentatively set for 2014 and 2015.) Still, the downward trend in 3-D revenue numbers is unlikely to reverse anytime soon. If the medium isn’t dead, it’s mortally wounded.

Probably the only time I haven’t hated, or at best been indifferent to 3D, is with mo-cap characters, like in Avatar. Something about the 3D does help them look slightly less fake (and the Adventures of Tintin footage I saw at Comic-Con looked pretty good too). But leave it to Hollywood to see one 3D movie succeed and then think EVERY movie should be in 3D, because no one trusts their own common sense over quasi-meaningless numbers. Actually, that’s pretty much true of all business. But eventually the Warrants outnumber the Guns N Roseses and hair metal dies. Then Nirvana shows up, and it’s cool for a while until Candlebox and Seven Mary Three come along, and before you know it, people are listening to Limp Bizkit. I guess what I’m trying to say is, we’re screwed.