More readers keep the discussion going:
I actually find myself going to more movies now than I ever have for one sole reason: my waning attention span. I can't tell you how many times I've tried to put on a DVD or a downloaded movie only to pause it after 20 minutes because I'm so fidgety. I'll also usually find my iPad in my hands while I'm trying to watch, which isn't exactly the best way to immerse oneself in a story. However, when I go to the theater, I have no choice but to give the movie my undivided attention for two hours. I can't check email (or The Dish!) and I can't get up to putter around while the movie is on. The theater forces me to watch what's in front of me, and I subseqently find that I get far more enjoyment as I would at home.
I can only speak from my experience, but I manage a multi-screen art house (with a few mainstream movies thrown in here and there) in a large city. 2011 was actually our most successful year ever at the box office and in overall revenue (and 2010 was the previous high). We are definitely not seeing any long-term downturn. But I think the mainstream industry problem comes from two areas in particular:
a) The dumbing down of major mainstream product and turning them into video games to appeal to a younger audience has backfired. A movie resembles a video game is always going to pale in comparison to the interactivity of an actual video game. This is why all the kids that I know like going to the movies – but they LOVE playing video games.
b) Post Avatar – the rush by several of the mainstream chains to add additional surcharges (for IMAX, for 3-D, for additional screen size, etc.) has backfired and has threatened the main advantage that movies have had. People are going to always want to go out and movies have been and should always remain about the most inexpensive form of quality entertainment (especially compared to going to a performing arts or sporting event).
What really has helped break the back of movie theaters is computer graphics getting cheaper and easier. It used to be that serials like Lost, Walking Dead, etc. were not possible except at great expense and as a major broadcast event for a limited run because special effects were so expensive. Using computers to digitize what used to be man- and money-intensive scenes has opened up TV production studios to produce shows/movies that would have filled the low-A/good-B-film and hobbyist niches (hobbyist niche is like zombie-fan, murder-mystery-fans, etc).
Another reader counters previous ones who complained about other moviegoers:
If there is a segment of the market that is actually saying, "I would go to the movie, but I hate those damn kids with their smart phones!" I am certain it is minuscule. If you're truly bothered, here's a tip: see movies a few weeks after their release, when the crowds are smaller.
Your commentator who said "If you're older than say 35, the first movie you saw was likely at a theater" is off by about 30 years. Those over 65 or so probably saw their first movies in a theater. But movies started airing on TV almost as soon as there was commercial TV, so once the television became fairly ubiquitous – and that was in the '50s – television became the first home for movies for pretty much everyone.
Though VCRs didn't really appear until the late '70s.