Business model

Simultaneous releases are ‘dead as a business model’ – The Hollywood Reporter

National Association of Theater Owners President and CEO John Fithian didn’t mince words when explaining why releasing films in theaters and at home at the same time is a terrible idea .

“I’m happy to report that simulcast is dead as a serious business model, and piracy is what killed it,” Fithian said during his annual CinemaCon keynote in Las Vegas on Tuesday. “When a blank copy of a movie gets online and spreads, it has a very detrimental impact on our industry.”

Throughout the pandemic, some Hollywood studios, including Warner Bros. and Disney, have experimented with day-and-date releases in an effort to grow their streaming services. In fact, Warners sent its entire 2021 slate simultaneously to theaters and HBO Max, including tentpoles such as Dunes. The studio dropped the policy from 2022 and committed to a 45-day window.

“As you analyze title by title, it becomes very clear that the piracy spikes are most drastic when a movie is first available at home: whether it’s available via video on demand premium or subscription video-demand,” Fithian said. “Robust theater storefronts protect against piracy. , the temptation to stay home and watch pirated movies is growing for many would-be moviegoers.

During his Tuesday on-stage speech at CinemaCon, Motion Picture Association President and CEO Charles Rivkin also spoke about the dangers of piracy, regardless of when it happens in a movie’s life. “On average, pirating before release can cost you up to 20% of box office revenue – your revenue,” he told theater owners.

Rivkin did not specifically address the amount of piracy due to simultaneous releases orchestrated by MPA member companies, which include the five major Hollywood studios and Netflix.

“And with the right efforts to educate consumers, lawmakers and the media, we can continue to build a culture that recognizes piracy for what it is – theft, plain and simple, and a direct threat to creators. the creative workforce and the creative community everywhere,” Rivkin said.

“In 2017, we created the Alliance for Creativity and Entertainment – ​​or ACE as we call it – a global coalition of our six MPA studios and the world’s largest entertainment companies, including Apple TV+ and Amazon Studios, AMC Networks BBC and Canal Plus. ACE members are now nearly 40 and we have just added a new level of live sports. In fact, I’m proud – this morning – to announce that BeIN Sports, a Qatar-based sports broadcaster available in 41 countries around the world, has signed on,” Rivkin said.

The anti-piracy efforts of the MPA and ACE, together with other groups, have helped reduce the number of illegal websites and streaming subscription services in North America by from a high of 1,400 in 2019 to around 200 today. He also said the MPA recently entered into an agreement with the Department of Homeland Security that integrates MPA investigative experts into DHS itself.

Continuing, Rivkin said he was “encouraged by our progress in this ongoing fight against piracy, and I am also encouraged by the surges we are currently seeing at the global box office. These current box office successes show that moviegoers still appreciate the sanctity and social exhilaration of shared space.

Indeed, both Rivkin and Fithian have touted box office strength coming out of the devastating COVID-19 pandemic, which has led to unprecedented theater closures.

“The slate of movies in 2022 and beyond is solid and full of huge box office potential. The renewed commitment of our partner studios for the exhibition is fully visible this week. I am grateful that so many top studio executives are here this week, and I believe their presence at this historic convention signals a renewed commitment to the important role that cinema plays in the industry ecosystem. said Fithian.

The Batman Filmmaker Matt Reeves kicked off the morning session on the state of the industry by thanking movie theater owners for keeping the “twinkle of hope” alive when the pandemic hit. He said he wholeheartedly believed in the theatrical experience. “Helping play a part in your success is very important to me,” Reeves said noting that Batman earned north of $700 million.

“The success of The Batman was a real team effort. We couldn’t have gotten to this place without… the theatrical experience. For that, I thank you from the bottom of my heart. As a lifelong movie fan, I cherish what you do,” Reeves said. “There is sanctuary to be found in the movies.”

In pre-pandemic times, the theatrical window was 74 days to 90 days. This window is now reduced to 45 days, which theater owners now accept. (For their part, studios have long maintained that most movies make most of their money in the first month.)

“We’re excited for distributors to release windowed films and for studios and exhibitors to work together. There’s a diverse mix of titles to look forward to in the coming months,” Fithian said. “Blockbusters are the backbone of this industry, and we have a great selection of really big movies. But mid-range titles and movies aimed specifically at families are also crucial. We have it all. not rocket science: more movies translate to more box office.

Fithian highlighted the amazing success of Sony and Marvel Spider-Man: No Coming Homewhich grossed $1.9 billion worldwide, and noted that families are now making a serious comeback to movies, as evidenced by Paramount’s sonic the hedgehog 2 (which has grossed $288 million worldwide so far).

Fithian, who has often dismissed the perceived threat from streamers in the past, stayed away from the topic this time around. On April 19, Netflix revealed that it lost 200,000 subscribers in the first quarter, sending its stock plummeting. The development is something of a psychological boost for theater owners, allaying concerns that streaming will trump cinema.

At the end of Fithian’s speech, he presented a new series of films created by young aspiring filmmakers designed to promote the cinema that NATO asks its members to share on their screens and on social media. The filmmakers are Kelly Schiesswohl and Noah Sterling for Oddly Satisfying Cinema; Ed Hellman and Katie Staab for There’s nothing like it; and Ameer Kazmi for Sincerely, The Management.

“I believe nothing will ever threaten the theatrical experience, not streaming, … not even the landing of the Martians, I joke,” said Cineplex chief Ellis Jacob, adding that many wrote the obituary of the exhibition industry by mistake. “We have been tested by COVID. Now all that’s left is an opportunity.

Jacob received NATO’s Best Marquee Award before Rivkin and Fithian took the stage.

Chris Gardner contributed to this report.