COVID-19 and the Future of the Movie-Going Experience

For some time now, the studio movie system has been figuring out a way to buck the current theatrical window: 90 Days. More of a guideline than a rule, 90 days is the handshake deal that distributors have made with exhibitors.

2011 is a flashpoint in the attempt to smash the theatrical window. 

In the Spring of 2011, Warner Bros., Fox, Sony, and Universal launched a test premium VOD service on DirecTV, offering titles including Unknown and Just Go With It sixty days after their theatrical release for $29.99.  Exhibitors fought back and threatened to change its trailer policies and the experiment failed. Later that year, Universal made a bid to crash the theatrical window when they announced they were going to release their holiday movie, Tower Heist, starring Ben Stiller and Eddie Murphy, on VOD just three weeks after it’s November 4th theatrical release. Universal claimed this was only a “test” designed to gauge consumer interest, and would only take place in two markets. The feature would be offered to roughly 500,000 Comcast digital subscribers in Atlanta and Portland for a pricey $59.99. Exhibitors and filmmakers such as James Cameron, Michael Bay, Peter Jackson, Todd Phillips, and even Tower Heist‘s Director Brett Ratner, went on record protesting the collapsing of the theatrical window.  Cinemark, the country’s 3rd largest theatre chain threatened to boycott the movie entirely and shortly after, in a sign of solidarity, other exhibitors also threatened not to play the movie. On October 12, 2011, The Hollywood Reporter reported: “Universal has scrubbed plans to make Brett Ratner’s action-comedy Tower Heist available in homes only three weeks after it debuts in theaters on Nov. 4, following threats by theater owners to boycott the film altogether.”

Since then, streamers, Netflix, most notably, have proudly disrupted the traditional theatrical window. Netflix has opened movies in select theatres (It should be noted; AMC, Regal, and Cinemark do not open Netflix movies in their respective theatres) and make the title available to stream within 30 days.  The most notable titles are RomaThe Irishman, Marriage Story, and The Two Popes have all been nominated for various Academy Awards but none have taken the prize for Best Picture.

PANDEMIC!

The Coronavirus (COVID-19) has changed (hopefully temporarily) our way of life. Social Distancing is a time out from everyone and the new norm. Businesses have been forced to shut down, including movie theatres.  Currently, AMC, Regal, Cinemark, Landmark, Alamo Drafthouse and more have closed down nationwide and most likely ALL theatres here and abroad will shutter indefinitely very shortly.

Studios have already pulled/delayed major releases.  The first was No Time to Die, followed by A Quiet Place 2, Mulan, Fast and Furious 9 and Black Widow.

What happens to the movies already playing in theatres? Universal was quick to respond to that question. Universal will break the theatrical window and make movies such as The Invisible Man, The Hunt, and Emma, available On Demand by March 20th.  These titles will have a 48-hour rental window for a price of $19.99. Also, they will release Trolls World Tour in theaters and On Demand at the same time.  It is being suggested that this too will be available for $19.99/48 hour rental.

Do you see a pattern here?

Universal wasn’t thinking about universal health care. As soon as they caught wind of theatre closure, their first instinct was to smash theatrical windows. Where they tried in failed in 2011, the pandemic has worked out in their favor. It’s an easy argument to make to the exhibitor.  “Hey, through no fault of yours your closing your theatres, we need to make the best of recouping loss of Box Office dollars so this is what we’re doing.” What can the exhibitor do? For titles like The Invisible ManThe Hunt and Emma it makes sense; they were already in theatres.  On the weekend of March 13, the Box Office hit a 20-year low and everything playing in theatres was impacted. Trolls World Tour is, according to BoxOfficePro.com, tracking to open to an estimated 23.5 Million with a Domestic Total Forecast of 81 Million. That is a bit tepid from the 2016 original Trolls 46+ million opening and 153+ million domestic total. You can count on neither of the three major exhibitors, AMC, Regal, and Cinemark to play the movie if they are open or will they break just to have something to fill their screens after a prolonged hiatus? That will be fun to find out. In fairness to Universal, they’ve moved FF9 to April of 2021 and have as of yet not announced any other titles for early On-Demand release.  This is, as they say, a test.

Warner Bros. and STX have announced earlier than the normal digital purchase of Birds of Prey and The Gentlemen respectively.

Exhibitors are stuck between a rock and a hard place; they’re being forced to shut down.  Circumstances are sure to level out but the major question is when? Unfortunately, there is no answer to that question, leaving exhibitors and studios in the lurch.

MOVING FORWARD

Can there ever be a middle ground between distributors, exhibitors, and the theatrical window?  Perhaps.  It could take some time but I would suggest this:

Work on a plan where exhibitors can utilize their apps to showcase movies.  AMC already does this. 

Using the traditional 90-day theatrical window as a starting point. After such time allow exhibitors to rent to its customers those releases at an agreed-upon price: say $25.  Distributors and exhibitors would negotiate the split of a fee, very similar to how they negotiate rental terms for their movie screens. Nothing needs to be etched in stone.  For example, a Marvel movie can sustain 3 months in theatres and still bring in respectable grosses. After a movie loses a certain percentage of total domestic screens then the title can be appropriated for exhibitor On-Demand.  When its time for the title to go to traditional On-Demand platforms i.e. Direct TV, Comcast, Spectrum, etc., the movie can no longer be available on the exhibitor platform.

By doing this, exhibitors won’t be left out in the cold.  They’ll continue to have a stake in a movie after three months, which means they’ll want to market their apps. Distributors will add to their revenue stream.

I will always champion the movie-going experience.  Exhibitors and distributors are going to have to meet somewhere in the middle to mitigate movies that underperform and further take advantage of movies that overperform.  Imagine if, during this time of self-quarantine, you were still able to support your favorite movie theatre(s) by paying to watch a movie on their app, which you most likely already have downloaded and how much better it would be for Box Office business while knowing the theatrical experience still exists.

Written by
A close to 30 year veteran of the Movie Business Industry. Movie Reviewer for WBCN radio in Boston and the Boston Phoenix newspaper. Have worked in Distribution for the likes of Universal Pictures and Lionsgate. Exhibition working for Hoyts Cinemas and General Cinemas. Screen Credited Production work on the movie CONTACT. Have worked with the Historic TECHNICOLOR to help usher in the digital age of projection for Exhibitors. Well before it became Public Enemy #1, worked with MoviePass in working together with Exhibition to usher in Subscription Service for going to the movies. Demitri currently works for Market Force Information providing data/analytics for Studios and Exhibitors and is a Podcaster on The Popcorn Talk Networks MEET THE MOVIE PRESS and ANATOMY OF A MOVIE.

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