Final Regulatory Assessment and Final Regulatory Flexibility Analysis Final Rule - Nondiscrimination on the Basis of Disability by Public Accommodations - Movie Theaters; Movie Captioning and Audio Description
3.1.3. Growth Rate of Auditoriums
The period of analysis in the Final RA spans 15 years. As a result, the cost estimation requires projecting the estimated number of auditoriums by venue type into the future. The 2014 MPAA report provides statistics on the growth rate of auditoriums by the venue size categories. Table 3-4 shows the average annual growth by such movie theaters from 2010 to 2014. Between 2010 and 2014, the number of auditoriums in venues with eight or more auditoriums (Megaplex and Multiplex movie theaters) grew by an average of 2 percent each year. The number of auditoriums in venues with seven or fewer auditoriums (Miniplex and Single-Auditorium movie theaters) has steadily declined since 2010, decreasing by an average of nearly 7 percent each year.
Table 3-4 : Average Annual Growth of Auditoriums by Venue Size (2010-2014)
|
Venue Size Category |
2010 |
2011 |
2012 |
2013 |
2014 |
Average Annual Growth (2010-2014) |
|
Eight or more auditoriums |
31,202 |
31,763 |
32,272 |
32,627 |
33,824 |
2.0% |
|
Seven or fewer auditoriums |
8,345 |
7,817 |
7,390 |
7,270 |
6,334 |
-6.7% |
Source: MPAA, Theatrical Market Statistics 2014 at 25 (2014), available at http://www.mpaa.org/wp-content/uploads/2015/03/MPAA-Theatrical-Market-Statistics-2014.pdf (last visited Sept. 12, 2016).
In the analysis, the annual growth rate for auditoriums in venues with eight or more auditoriums (2.0 percent) is applied to auditoriums in Megaplex and Multiplex movie theaters. The annual growth rate for auditoriums in venues with seven or fewer auditoriums (-6.7 percent) is applied to auditoriums in Miniplex and Single-Auditorium movie theaters.
Table 3-5 below shows how the growth rates are applied by venue type to derive the projected number of auditoriums in future years. The average annual growth rates by venue type are applied for the duration of the analysis. The table also shows how the growth rates are applied to the number of auditoriums in 2015 to estimate the number of auditoriums in the compliance year (2017),15 as presented in Section 2.1.2.
Table 3-5 : Calculation of U.S. Indoor Auditoriums by Venue Type (2017)
|
Venue Type |
U.S. Indoor Auditoriums |
× |
Average Annual Growth |
= |
U.S. Indoor Auditoriums |
|
Megaplex |
12,812 |
× |
2.0% |
= |
13,339 |
|
Multiplex |
20,322 |
× |
2.0% |
= |
21,158 |
|
Miniplex |
5,212 |
× |
-6.7% |
= |
4,541 |
|
Single-Auditorium |
993 |
× |
-6.7% |
= |
865 |
*Totals may differ due to rounding
Figure 3-1 below shows the distribution of auditoriums by venue type over the 15-year period of analysis. As the figure shows, the share of Megaplex and Multiplex movie theaters grows over time while the number of Miniplex and Single-Auditorium movie theaters declines. This is consistent with historical industry trends.
Figure 3-1 : Projected Number of Movie Theater Auditoriums over Period of Analysis by Venue Type*
bar graph showing projected number of indoor auditoriums over period of 15 years [sic]
ETA Editor's Note
As of 11/21/16 (this document's publication date), Figure 3-1 is not shown.
*Forecasted Projections developed by Department
However, assuming that these growth rates will continue over the next 15 years may not be a realistic assumption. To address this, the Department has conducted a sensitivity analysis estimating the costs of the final rule when assuming zero growth in the number of auditoriums five years into the analysis. The results of this sensitivity analysis are presented in Section 4.2.8.
15 The starting year of the analysis is mid-2016. With an 18-month compliance date, movie theaters must comply with the final rule's requirement by the end of 2017. The analysis assumes that any movie theater operating in 2017 will purchase the necessary equipment over the course of the 18-months before compliance is required (2016-2017).
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