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The Sphere Creates A New Revenue Stream For Hollywood
Courtesy of The Sphere
The Sphere’s 4D, AI-enhanced, 70-minute version of 1939’s The Wizard of Oz is shaping up to be the most successful repertory theatrical run in history.
The Big Picture: The narrative around James Dolan’s Sphere in Las Vegas has quickly shifted from a big gamble to a runaway hit, attracting millions of visitors to its state-of-the-art concerts. But it may ultimately be movies that drive long-term revenue as the company expands its footprint worldwide — especially with demand for immersive and PLF screenings continuing to skyrocket.
Behind The Screens: Wolfe Research compiled data on just how successful the classic The Wizard of Oz has been at the world’s most cutting-edge theater.
The movie is generating about $2 million a day from three screenings, each drawing 4,000 to 5,000 moviegoers paying almost $200 per ticket.
Sphere had already sold a total of 120,000 tickets before the movie even opened.
Executives expect the film will bring in $1 billion in ticket sales before it finishes its preliminary run.
But Sphere’s deal with Warner Bros. allows the company to program the movie indefinitely, ensuring it can always return to the venue — or future satellite locations — to make even more money. Warners gets a licensing fee and a small cut of ticket sales.
Final Credits: Sphere spent nearly $100 million retrofitting The Wizard of Oz for its venue, so the investment seems like money very well spent. And while music residencies will account for roughly $200 million in revenue this year, Sphere projects $400 million from movie screenings, including four million tickets sold for Darren Aronofsky’s Postcards From Earth.
What makes that gap even more striking is the margin: Sphere reportedly keeps about 70% of movie revenue. In other words, while concerts may be the marquee headliners, movies could be what truly makes the Sphere wildly successful.
Coming Soon: Expect every studio to want in on the Sphere action — especially as a vehicle to turn fandom-driven IP like Star Wars, Avatar, and Jurassic Park into exclusive, theme park-style events.
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Today’s email was written by David Vendrell.
Edited, Polled, and Copy-edited by Kait Cunniff.
Published by Darline Salazar.