REAL-HOME-THEATER-DMT

Next up: A popcorn machine? With movie theaters out of the question in many areas, those staying at home are looking to make their home viewing more grand.

The dark textured walls are lined with dimly lit sconces and surround-sound speakers. Below them, carpeted tiers of cup-holding reclining seats jut toward a large projection screen. The room doesn’t yet smell of buttery popcorn, but it begs for it — this is a movie theater, after all. Except this theater doesn’t require tickets or face coverings. It isn’t even attached to a mall or parking lot. It’s just a room in the basement of a home that recently sold in Paramus, N.J.

The scene isn’t an unusual one for Bergen County, one part of the state that’s experienced a boom in home sales amid the COVID-19 pandemic as city dwellers seep into suburbs in search of more space. The area is teeming with Realtors’ signs and McMansions racing to finish construction before the buying frenzy is over. In November, the rate of U.S. housing starts for single-family homes rose for a seventh month to the highest since 2007. Demand for million-dollar listings has been growing the fastest, according to the Mortgage Bankers Association. And in towns like Paramus, those tend to come with a few requisites tailored to post-COVID life: plenty of office space, a gym — and a movie theater with all the fixings.

“In new constructions it’s now almost standard,” said Taylor Lucyk, a broker associate for Christie’s International Real Estate in northern New Jersey. He started noticing more home theaters in 2019, but at the time they were more of a bonus feature. “Now with COVID, it’s just kind of become the norm.”

As Wall Street investors try to gauge whether multiplex cinema operators will survive the crisis, it’s hard to look at this trend and feel very optimistic about movie chains’ prospects. That’s not to say that mini home theaters — a swanky excess of million-dollar houses — are becoming commonplace. But middle-class households are increasingly investing in electronics that try to recreate the theater experience as well. The declining cost of large, high-resolution television sets and sound bars has made that possible.

A quick online search on Amazon and Best Buy shows 65-inch 4K flat-panel smart TVs for as low as $400 (though the ultra-vivid OLEDs are still much more expensive). Between 2014 and 2019, the average cost-per-square-inch of screen in the U.S. fell to 39 cents from $2.15, an 82 percent drop, according to a Deloitte report this month that predicts a rise in sales of next-generation 8K TVs is coming next.

Cinema-quality streaming programs — such as the onslaught of Star Wars and Marvel series hitting Disney+ in the coming years — will make 4K and 8K TVs that much more desirable. AT&T Inc.’s Warner Bros. studio is even releasing all of next year’s films, including big-budget productions such as “Dune” and “The Matrix 4,” on HBO Max the same day that they arrive in theaters. In the meantime, COVID-19 has made all things home entertainment — streaming-TV apps, video games, comfortable viewing setups — almost indispensable.

TV sales are at a record in the U.S. this year, according to Stephen Baker, vice president at research firm NPD Group Inc. and adviser to the technology and mobile industries. He sees the final tally coming in at $17 billion to $18 billion, up from $14.7 billion in 2019. Nearly 10 million more units will have sold this year than in any other time during the last decade. He said a large part of the growth is coming from really big TVs — 65 inches and larger. That’s quite a shift from predictions that tablets and phones would become the viewing device of choice in the streaming era. “We all got maybe a little bit seduced by the start of mobile streaming, and what we’ve see in the past couple of years is this return to the home-entertainment stack,” he said. “Everybody wants the biggest, best TV they can afford.”

As for projectors, Epson America, a unit of Japan’s Seiko Epson Corp., has had double-digit sales growth “across the board” for its home theater projector models ranging in price from $500 to more than $5,000, said Mike Isgrig, vice president of North America consumer sales and marketing for the electronics company. And shoppers aren’t just buying projectors for indoor use — a summer spent at home drove interest in backyard movie nights as well.

None of this is likely to be just a 2020 phenomenon. And so the double blow of the pandemic and the streaming wars could mean that movie theaters — the kind where you sit next to strangers — never fully rebound. In the latest weekly Morning Consult poll, 39 percent of U.S. adults said it would be more than six months before they’d feel comfortable going to the movies; another 23 percent didn’t know or didn’t have an opinion. It’s not a good sign that the majority are either still wary of theaters or just don't care to go anymore.

The coronavirus wasn’t the cause of this shift, but it was a potent accelerant. And it could be argued that the biggest change this year wasn’t even in consumer behavior — that began long before COVID-19. Instead, it was the entertainment giants that stopped resisting the Netflixication of Hollywood. After both Warner Bros. made its Dec. 3 announcement regarding next year’s films and Walt Disney Co. held its streaming-strategy reveal on Dec. 10, there was a central theme in the reader comments that subsequently flowed in: It was time to buy that 65-inch TV. Here’s one such response made public on LinkedIn:

Christopher Nolan, who wrote and directed Warner Bros.’ “Tenet,” reportedly told a cinema industry trade show in June that the sci-fi spy thriller “is a film whose image and sound really needs to be enjoyed in your theaters on the big screen.” But why? Technology has made it possible to get much the same experience without leaving home. When “Wonder Woman 1984,” another Warner Bros. movie, gets released to both theaters and HBO Max on Christmas day, the streaming uptake and reviews will only give the industry more confidence that it is moving in the right direction. As for consumers who already invested in a big-screen TV, a popcorn machine may be next.