Hollywood Could Lose $20 Billion Due to Coronavirus Delays
The week of March 8, 2020 may very well go down as one of the most dread-filled in Hollywood history thanks to growing concerns over the coronavirus pandemic and its impact on Hollywood and the global entertainment industry. Every day, we learned of numerous announcements made about various studio shutdowns, release dates pushed or substantially delayed, movie theaters taking every precaution to protect theatergoers, and even updates on how the celebrity community is faring right now.
In light of these very serious decisions being made, The Hollywood Reporter notes that Hollywood could be hit with a $20 billion loss this year due to the impact of coronavirus-related decisions across film and television. When you consider smaller-scale impacts like No Time to Die taking a $30 to $50 million hit because its release was pushed from April to November or the domestic box office likely hitting a low not seen in over 20 years (as reported by Deadline), $20 billion sounds about right even if it sounds extremely high, too.
Image via Disney
Release date delays on big tentpoles like Mulan, A Quiet Place Part II, Fast 9, and The New Mutants will have to brace for impact, notably at the box office and especially in the marketing department, where previous agreements to promote films online, in print, on television, and beyond have been in place for months and will cost majorly to readjust. Production delays on major upcoming releases and TV shows like Shang-Chi and the Legend of the Ten Rings, Jurassic World: Dominion, and Stranger Things 4 will also result in more money added to accommodate delays. Sources speaking to THR estimate a delay on a project like Shang-Chi would cost $300,000 to $350,000 a day. Depending on the length of a particular production delay, we could see even more release dates moved as a result, further sending the numbers into unusual territory. The one key area estimate losses will get tricky is in the TV arena; getting a handle on those numbers is tough at the moment but it’s safe to infer the hit will be just as impactful.
THR reports the global box office has already taken a $7 billion hit and could climb to $10 billion if decisions relating to theater capacity cuts or closures and delays continue through May. While all movies depend on international box office revenue, movies like Mulan and Fast 9, which have massive international fanbases or have historically fared far better in overseas markets like China, the impact from coronavirus-related delays will be very serious.
There is also a very human cost to these production delays. Labor and performer unions like IATSE (International Alliance of Theatrical Stage Employees), which will be faced more directly with the ramifications of the immediate Broadway shutdown, will be handling members looking for guidance on how to deal with lost work, impacts to healthcare costs, and even the long-term effects on things like retirement coverage. IATSE International President Matthew D. Loeb laid it out to THR, putting it plainly,
“Right now, thousands of our members across all sectors of the entertainment industry are suffering financial hardship because of government mandated cancellations. Entertainment workers shouldn’t be collateral damage in the fight against the COVID-19 virus. But this isn’t just about us. Economic studies demonstrate that entertainment spending reverberates throughout our communities nationwide. Film and television production alone injects $49 billion into local businesses per year, and the overall entertainment industry supports 2.1 million jobs in municipal and state economies.”
Image via Joan Marcus
We’ll have to wait and see just how big an actual impact the coronavirus will have on Hollywood, but these financial estimates signal potentially long-lasting ripple effects on the health of the entertainment industry. With this global health crisis affecting an industry based around community gatherings at theaters, large populations working together on a set, or big media events like movie premieres and festivals bringing in hundreds, we should be prepared for gut-punching financial hits and ongoing discussions about the personal toll these industry decisions will have.
BY ALLIE GEMMILL/Collider
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