From Paolo Sorrentino’s 2014 Oscar-winner The Great Beauty to Call Me By Your Name, the highly acclaimed gay love story directed by Luca Guadagnino, Italy still has a flair for making films that create a global buzz. But that doesn’t mean to say that Italians are such great fans of their homegrown productions – at least when it comes to taking themselves off to the cinema to watch them.

According to dismal data released by film associations Anec and Anica, box office sales for Italian films were down by over 46% compared with 2016, while takings fell by around 44%.

The decline in receipts coincides with a 12.4 % fall in cinema attendance overall, with just over 92 million people going to a movie theatre in 2017, compared with more than 105 million in the previous year.

Francesco Rutelli, the president of Anica, blamed the proliferation of films online and piracy for the decline. “People want to watch films at home, with ease and comfort. Then a huge share [of films] are pirated,” he said.

But others argue that potential audiences are simply not enthused about what’s on offer. Foreign films help to bolster takings – the biggest box office hits in 2017 were Beauty and the Beast and Despicable Me 3 – but the golden era of Italian arthouse film has long gone.

“Italy basically invented the arthouse film but we were the first ones to kill it,” Alex Infascelli, a director and screenwriter based in Rome, told the Observer.

Infascelli, who won plaudits for Almost Blue, a thriller released in 2000, said that the decline in attendance began in the 1990s, when many theatres were turned into multiplexes and films more suited to television were being made for cinema. “In Rome, in the 1980s, we had cinemas showing the big US numbers but we also had a solid grid of arthouse cinemas. Now there are just two or three,” he said.

“It’s sad, especially when you compare Rome to London or Paris, where there is an incredible choice of theatres.”

Another factor affecting cinema and viewing habits in the 1990s was the arrival of Silvio Berlusconi on the political scene. At the time there were two main film production and distribution companies – Berlusconi’s Medusa and the government-owned RAI. In 1994 Berlusconi’s election as prime minister effectively gave him power over both.

“This is when a lot started to change,” Infascelli said. “They wanted to make films that were more like those you see on television, which was cool at the beginning, as you had a bigger audience.

“The products were less educational and more entertaining, but slowly the real cinema audience drifted away because they couldn’t see the difference between theatre and TV.”

Horror and comedy are now the most prolific genres, with much less focus on the kind of storytelling that used to reflect Italian society. “The French used cinema as a revolutionary tool, while the Italians used it as a mirror – to reflect what stage the country was at socially and politically,” Infascelli added.

“But Italians don’t see that reflection any more in films, it’s almost as if this love affair with our own image has been broken.”

Despite the grim audience levels in 2017, there are a few reasons to be hopeful this year. The cinema industry is eagerly awaiting the enactment of a law that will see more investment going into film-making, while there are some highly anticipated movies on their way. Alongside Call Me By Your Name, which is due for release in Italian cinemas on 25 January, Sorrentino makes a return this year with Loro, a film based on Berlusconi, while another Oscar-winning director, Gabriele Salvatores, will release Invisible Boy – Second Generation.

And there is still a strong band of avid cinema fans who refuse to cave in to the likes of Netflix. Noemi Rossetto, a barista from Orvieto, a town in Umbria which is home to a small cinema with two screens, said she goes to see a film every Tuesday – the day when screenings at the venue cost €4, half the normal price.

“I like the experience – the big screen, the popcorn, the seats,” she said.

And the films themselves? “There has been the odd good one recently, but others have been a bit banal,” she added.

Paolo Ferretti, the cinema’s manager, said 2017 was a slow one for the Italian film industry, but foreign films kept attendance at sustainable levels.

“There is a crisis in general, not just in cinema,” he said.

“Yes, it is easier to watch films online, but there are still those who prefer the cinema experience – and I believe this will continue.”