In 2010, the United States domestic box office raked in a whopping $10.5 billion from more than 500 movies [source: Box Office Mojo]. That's almost $1 billion more than theaters made in 2008, despite the fact that fewer movies found their way to the silver screen. The point is, the movie industry still makes incredible money today, despite all the modern technology that makes the living room movie experience better than ever.
However, even with all that revenue under its belt in 2010, not everything is looking good for the theater industry. Tickets sold have been down year-over-year every year since 2003 with two exceptions: 2006 and 2009 [source: Box Office Mojo]. The box office is making more money only because of rising ticket prices, which poses an important question: How long can they keep it up?
As ticket prices gouge our wallets for larger helpings of cash, home theater technologies grow all the more affordable and sophisticated. Who wants to pay $18.50 to see a 3-D movie (which is what you'll pay in a city like New York) when they could own their own 3-DTV [source: Time]? Who wants to pay $8 to see a normal movie -- the national average ticket price in 2011 -- when they could subscribe to Netflix for an entire month for that same price [source: Box Office Mojo]? Those are just a pair of the 10 TV technologies making movie theaters obsolete. If the box office doesn't watch out, these inventions will keep sending those ticket sales down, down, down.
3-D has been a major push for the movie industry since James Cameron's "Avatar" debuted at the end of 2009 and proceeded to make nearly $3 billion worldwide [source: Box Office Mojo]. 3-D's momentum isn't only affecting films: In 2011, Discovery Communications, Sony and IMAX launch their partner project 3net, the first cable channel offering 3-D programming 24 hours a day [source: Discovery].
Major electronics companies want in on the profits and are marketing 3-DTVs as the next big thing in HD. In addition to the basic convenience of watching at home, 3-D televisions offer something the movie theater can't match: choice. The current standard in flat-screen TVs is called active shutter 3-D. This technology uses battery-powered glasses to "shutter" an image in one eye and then the other. Matched with the refresh rate of the TV, this means each eye is seeing a slightly different image, creating the 3-D effect. Passive 3-D (the technology used in movie theaters) uses two image projectors and non-powered glasses with polarized lenses to block out a different range of light in each eye. This allows the left eye to see only one projected image and the right to see another, creating the 3-D effect [source: Best-3-DTVs].
With choice and convenience comes a downside: price. 3-DTVs are more expensive than regular high definition televisions, and the active shutter glasses can cost more than $100 a pair. In the future, manufacturers will be able to sell autostereoscopic 3-DTVs that work without glasses, but Samsung predicts such TVs won't be commercially viable until 2020 [source: SlashGear]. Once those screens become affordable -- assuming 3-D proves to be more than a short-term fad -- the home 3-D experience will definitely have movie theaters beat.
Around the year 2000, TiVo -- a set-top box with a hard drive for recording live TV -- revolutionized the way we watch TV. Think about it: For the first time, we were truly in control of content, recording television for later, skipping past commercials, and storing a catalog of shows we wanted to keep on a hard drive for viewing any time we please. It was a revolutionary step over the old VCR, and businesses like Netflix, Hulu and other streaming video services sprang from a new mindset of watching what we want when we want. The name "TiVo" even became synonymous with DVRs in general; many cable and satellite subscribers own a set-top box that is a digital video recorder, but not all of those devices are actually TiVos.
More than a decade after its introduction, TiVo is more sophisticated than ever: The TiVo Premiere has enough storage space for hours of HD video, replaces the cable box, and provides access to various web video services like Netflix and Hulu [source: TiVo]. While TiVo charges a monthly fee for its services, many cable companies are eager to have that money for themselves -- that's why they'll offer you a DVR cable box of their own. While these DVRs focus on cable services rather than the range of functionality of the TiVo, cable companies do their best to bundle services in an effort to make package deals appealing.
Video on Demand and Pay-Per-View
Even before TiVo changed how we watched live TV content, cable and satellite providers had their own way of offering programming on demand. Video on demand and pay-per-view services allow you to purchase a movie or other piece of content straight through the cable/satellite box's built-in interface, granting you access to an in-home movie rental good for a limited period of time. These purchases are even more convenient than heading to the rental store to pick up a movie, and they aren't limited to the big TV providers. Amazon Video on Demand and Apple TV are two popular choices that offer rental content streamed over a broadband Internet connection.
Sports fans are familiar with the world of pay-per-view -- unlike a video on demand rental, a pay-per-view event is broadcast at a specific time to anyone who paid to view. Boxing, wrestling and Ultimate Fighting Championship (UFC) fights are big pay-per-view moneymakers; in 2008 UFC earned $300 million from pay-per-view buys [source: Time].
Home Theater Projectors
Today's HDTVs measure upwards of 50 inches (1.3 meters) and offer incredible picture quality compared to the standard definition TVs we were using a decade ago. That said, they're not quite the same as a projector displaying an image on a majestic movie screen -- partially because those screens are way bigger than 50 inches!
Home theater projectors like the Epson PowerLite can project an image as small as 30 inches (76 centimeters) across or up to 200 inches (5.1 meters) [source: Projector Central]. Sound big enough? Projectors aren't cheap, but offer superb picture quality under the right lighting conditions. That can be a drawback, too -- projectors need dark rooms just like movie theaters, limiting their accessibility compared to LCD and plasma screens. With that limitation in mind, anyone who has the cash to build a cozy home theater won't find much reason to go out for a night at the cinema.
Home Theater Surround Sound
Other than a gigantic screen, there's really only one enticing element of the movie theater missing from the average living room: booming surround sound. Powerful sound pulls you into the experience, projecting music and effects from all around you with clarity and volume in a way the small built-in speakers on a TV won't come close to replicating. As theater-killing technologies go, surround sound is a vital component.
Just as big, flat screen TVs have grown more affordable over the years, surround sound has become a more accessible home theater option. Home-theater-in-a-box systems, for example, include a receiver -- which handles all the various inputs and outputs for sound and video devices -- and a set of speakers for 5.1 or 7.1 surround sound. Six channels of sound are provided by 5.1 surround, including a channel dedicated to bass, while 7.1 adds two extra rear channels into the mix to increase the "surround" effect. The appeal of a home-theater-in-a-box is simplicity -- it comes with all the sound equipment you need in one package, and it's all designed to work together [source: CNET].
Audio/visual aficionados may prefer to buy their speakers and receivers separately, however, to pick out speakers with better sound and a receiver with better inputs or HD upscaling. This is typically a more expensive choice, but gives you a chance to customize your surround sound setup or expand it over time by adding speakers gradually -- perhaps to upgrade from 5.1 surround to 7.1 surround.
TiVo and video on demand services spawned an entirely new way of thinking about TV. Rather than planning our lives around when shows were on, we realized we could plan our viewing schedules around our lives. The capability to do this has expanded enormously with faster broadband Internet connections, Wi-Fi and devices built to take advantage of those technologies.
Media streamers are essentially small computers, usually lacking the expansive storage capacity of a TiVo's hard drive. Media streamers or players rely on other sources of content and are designed to be plugged directly into your TV to provide an easy interface for playing video. The wide selection of media streamers on the market today means these devices range in design and functionality. On one end of the spectrum is the Apple TV: The $100 device only outputs 720p video, streams files from iTunes and Netflix and lets users rent videos through Apple's movie store [source: Apple].
On the other end of the spectrum is the $200 Boxee Box: Not only can the Boxee stream virtually any kind of media file from a computer over Wi-Fi, it outputs video in 1080p and automatically organizes and labels content. Boxee is one of many media platforms that provides Internet-based "channels" of content in streaming form -- video like Netflix and Hulu, music from Pandora, or web videos from Comedy Central [source: Boxee].
Blu-ray and HD storage
Just as VHS defined an era of home video and DVD brought movies into the digital age, Blu-ray has become the standard for HD content. But where VHS and DVD barely matched the visual quality of a film projector, Blu-ray is an altogether different beast. Dual-layer Blu-ray discs are capable of storing up to 50GB of data, which provides ample room for a 1080p film and uncompressed surround sound audio [source: Blu-ray].
While media streamers provide an inexpensive and convenient way to watch video content, streaming high definition video from the Internet -- especially over a Wi-Fi connection -- is very demanding. For now, Blu-ray remains the optimal choice for audiophiles and videophiles who care about the very best sound and picture quality.
Since the height of the DVD's popularity, computer storage has changed enormously as well. Home theater PCs and media servers are viable now because physical storage -- aka hard disk drives -- are cheaper now than ever before. Drives with 1 terabyte of storage -- that's 1000 gigabytes -- sell for less than $100. That's enough space to hold dozens of HD movies.
The Evolution of HD Televisions
All our media playing devices and storage formats would be pointless without a TV worth connecting them to. Luckily, HDTVs look leaps and bounds better than the SDTVs of the 90s and early 2000s. Old cathode ray tube TVs were no competition for a movie screen; they were low resolution and couldn't display images at the frame rate of an HDTV or with the same color quality [source: Projector Central].
With HDTVs, watching a movie at home can look every bit as good as a theatrical showing -- and home HD projectors go that extra step by replicating the theatrical experience of watching a projected image on a silver screen. And here's the great thing about HDTV technology: As movie theaters charge more money for tickets every single year, TVs get cheaper. In 2006, I bought a 26-inch 720p Samsung LCD for $1000. Today a larger, better 40-inch 1080p Samsung sells for less than $900 [source: Amazon]. While cutting-edge TVs are still expensive, the passage of time will continue to drive prices down while picture quality and design improves. In 2000, the average TV was primarily a boxy hunk of plastic. In 2011, we can buy LED-backlit TVs 55-inches across and barely more than an inch thick [source: Samsung]!
Broadband Internet and Digital Delivery
Out of all the amazing technology making movie theaters obsolete, one aspect above all drives today's content consumption: availability. In just a few years time video delivery via the web has become a viable business model thanks to faster Internet speeds. Streaming a YouTube video never required tons of bandwidth, but streaming an entire HD movie or even an hour-long TV show is another story.
Without high-speed Internet, we'd have no media streamers or sites like Hulu. We'd have no Internet-enabled TVs with "channels" of Web content. And we definitely wouldn't have video on demand platforms from companies like Apple and Amazon, who have huge online content offerings but don't control the hard lines into our homes like Comcast or AT&T. The Internet has changed the movie industry forever.
While high-speed Internet is available in the U.S., the network infrastructure lags behind many other developed nations. The average U.S. speed is about 4.8 megabits per second, which places us far behind Japan (61Mbps) and a number of other Asian and European countries that average much higher speeds [source: TaranFX]. Over the next decade, as fast networks like Verizon's FIOS -- which offers speeds from 15Mbps to 50Mbps -- spread across the country, we'll be able to download and stream 1080p movies with ease [source: Verizon].
Netflix is the culmination of all those advancements brought about by broadband Internet access. When the company launched as a by-mail DVD rental service, it quickly rose to dominance over traditional competitors like Blockbuster. But Netflix really changed everything when it launched Instant Streaming; with the same monthly subscription used to rent DVDs, subscribers could stream select movies to their computers (and eventually game consoles, TVs, media streamers, and more).
Netflix Streaming's popularity grew so quickly that in 2010 it accounted for 20 percent of all downstream Internet traffic in the U.S. during peak usage hours [source: ReadWriteWeb]. That's a lot! But how does that affect the movie industry? Again, it's all about availability. For less than the price of a single movie ticket, Netflix offers instant access to hundreds of movies and television programs, and the available content is always expanding as Netflix secures new licensing deals. In the fourth quarter of 2010 alone, Netflix made $47 million in profits out of a total revenue of $596 million [source: DMNews]. Blockbuster, on the other hand, filed for bankruptcy in September 2010 with almost $1 billion in debt [source: LA Times].
More than any other content provider, Netflix has changed the way we watch movies. And it's changed our habits remarkably quickly: Instant streaming wasn't a major focus for the company until 2008 [source: LA Times]. As Netflix continues to offer subscribers more content for their entertainment dollar, movie theaters ask for more money to see a single movie.
Netflix and the other home-theater innovations we've discussed in this article demonstrate the best conveniences of all the modern technologies making theaters obsolete. In the coming years, theaters will have to work hard to find new ways to be relevant as tech marches on.
Susan Bennett never knew she would become one of the world's most famous voices until Siri debuted on iPhones in 2011. HowStuffWorks tells her story.
- 10 Ways to Make Your Home Theater More Like a Real Theater
- 10 Ways DVDs Have Changed the Film Industry
- 10 Ways Television Has Changed Sports
- Quiz: Home Theater Lingo
- How Television Works
- How Surround Sound Works
- How Blu-ray Discs Work
- How Movie Projectors Work
- Are big-screen TVs killing the film industry?
- How have DVDs changed the lifespan of TV shows?
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