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The Collapsing Theatrical Window for Films

Thursday, May 18th, 2017

As Anthony D’Alessandro notes in Deadline, theatrical release windows for movies are in jeopardy.

There’s been a lot of talk recently that film distribution is moving away from theaters, and towards PVOD – Premium Video on Demand – viewing a film at home on the day of release for as much as $50 a pop. It’s been tried before, and except for big ticket sporting events, it hasn’t really worked out. But that may be changing.

As  D’Alessandro reports, “The urban myth feared by many is that if the per-title rental price in the PVOD window drops down to $20, consumers ultimately will realize that it’s cheaper to watch a movie at home then in cinemas, forgoing costs that come with a night out, i.e. babysitter, parking, dinner, etc. Some studio executives claim their talks with exhibition over PVOD aren’t contentious, but many insiders say that both parties’ working relationship is best described as ‘frenemies.’

Says one distribution veteran: ‘Exhibitors are freaking out. They can’t make money unless they grow their companies, and it’s hard to build these $40M multiplexes. If you have your investors hearing about windows closings, what incentive is there for them to hold on to their stocks?’ The former executive adds that PVOD, if not managed properly, could cause ‘a slowdown in exhibitions’ luxury-seat remodeling and force the mom-and-pop theaters out of business.’ Some also forecast that the domestic supply will shrink, that moviegoing will be relegated to tentpoles with mid- to low-budget fare relegated to in-home streaming.

However, these are doomsday theories, and there’s some positive evidence that the majors aren’t going to cannibalize their own business. Here they are:

The Theatrical Window Will Be Protected: ‘The last thing studios would want to do is threaten that lucrative revenue stream by encroaching on the theatrical window,’ says Tony Wible, Media & Entertainment Senior Analyst at Drexel Hamilton. ‘Theatrical plays a role in pricing the TV licenses for films, and there’s an incentive for studios to maintain the theatrical window.’

Despite Their Bullishness, Studios Haven’t Figured Out a PVOD Formula Yet: There’s buzz that Warner Bros. will come to terms on a PVOD solution by Q4 or Q1 2018, but they’re not going to act alone in the marketplace without another studio. In addition, there are too many moving parts to the PVOD equation, and the whole notion of it goes beyond the Monday-morning haggling between a distributor and exhibitor to hold a film on screens. Other windows like electronic sell-through [EST, when the consumer purchases a permanent video download, either in the cloud or on their computer] would be impacted, and that’s another discussion studios need to have with digital partners including iTunes and Vudu.

If PVOD Becomes a Reality, It Will Face Its Own Challenges: Home consumers already have committed their [money] to cable bundles, Netflix, Hulu and Amazon Prime. When it comes to content in the home, they have way too much of it, not to mention VOD menus are already crowded. So, where’s the incentive to rent one title for [as an example] $30? ‘If you have a $30 VOD product, it’s going to be too expensive for the home consumer when it’s priced against these services,’ says Wible, ‘There’s a value trade-off.’

In Addition, Exhibition Claims That In-Home Streaming Services Aren’t Their Direct Competition: According to Alamo Drafthouse and Neon label chief Tim League,’Theaters are more in competition with restaurants and comedy clubs and the types of entertainment that gets you out of the house.’ Currently, exhibitors such as Regal, Cinemark and AMC are barreling forward with luxury modeling and food/alcohol amenities, and these efforts have led to increased capacity and B.O. revenue upticks, with increased cash-on-cash returns.

Mid- and Low-Budget Movies Can Remain in the Theatrical Space: Some have screamed that economically budgeted fare doesn’t have a chance going forward in an event-driven theatrical marketplace, but the success of Get Out, Split, Fifty Shades Darker, Hidden Figures, John Wick: Chapter 2 and even La La Land have proved otherwise; that’s all about how a studio positions and sells a film. ‘There’s not a clear delineating line of what is meant for theatrical and what’s intended for streaming,’ says Amazon’s distribution and marketing chief Bob Berney.

Whether a mid-budget or indie film winds up on streaming or theatrical has a lot to do with a film’s financiers, and when there’s a company like Netflix willing to pony up big bucks for the smaller screen, money talks. In addition, mid-level and low-budget films ‘need to be event-ized,’ says Berney. Whether they thrive on the big screen boils down to several factors, i.e. a distributor’s passion for the film, how far they’re willing to go with it, a pic’s critical and festival reactions. Not to mention, as long as there are Oscars, there will be smart, upscale specialty movies on the big screen.”

There’s much more to this excellent article; you can read the whole piece by clicking here.

Theatrical vs. VOD – The Future is Now

Sunday, April 2nd, 2017

As Lindsey Bahr of the Associated Press notes, theatrical vs. VOD is a key issue for filmmakers today.

As she writes, “would you pay $40 to watch a movie in the comfort of your own home 10 days after its big-screen release? How about $30 after 45 days? These are just a few of the ideas being thrown around by major Hollywood studios looking to more effectively compete with streaming services, television, smartphones and everything else that consumers can choose to spend their time with nowadays.

Premium video on demand (PVOD) is less disruptive than Sean Parker’s troubled Screening Room idea, which would have offered movies in the home for $50 on the same day they’re released in theaters. Yet PVOD still had many questioning its merits this past week at the theater industry’s CinemaCon in Las Vegas, from big studio execs to small theater owners, and stars and filmmakers in between.

For most exhibitors, shortening the theatrical window, as the industry calls it, from the traditional 90 days is seen as a bad idea, especially for those who’ve invested large sums of money to upgrade seats and projection tools at the behest of the studios. ‘The shortening of the theatrical window would be horrible for the entire industry,’ said Glen Gray, an exhibitor from South Florida.

As would be expected at an annual gathering of exhibitors, from big theater chains to single-screen operations – many studio executives were quick to emphasize their commitment to the theatrical experience. Dave Hollis, the executive vice president of distribution at the Walt Disney Company, used his platform to speak on behalf of his company and other Hollywood studios to tell exhibitors that they ‘all believe deeply that films should be seen in a theater’ and that they ‘have a common goal to get people to see them in your cinemas.’

Even Amazon Studios, with its blatant streaming strategy, offered encouragement to theater owners. ‘We really believe in the theatrical experience by fully supporting the theatrical window for our releases,’ said Jason Ropell, Amazon’s head of motion pictures, noting that Manchester by the Sea‘ is in its ’19th week and counting’ in theaters.

But there’s no question the marketplace is changing. The North American box office may have reached record highs the past two years, yet attendance has remained nearly flat for over a decade. In other words, growth is coming from higher ticket prices, not more people seeing movies.Warner Bros. marketing and distribution chief Sue Kroll was the rare executive at CinemaCon to speak openly about theatrical threats.

Customers, she said, ‘want more choices in where and how they consume our content. Where there is demand, somebody is going to step in and fill that void,’ Kroll said. ‘We have to be creative and innovative in addressing the challenges of this marketplace, as we always have [and] move toward a future that will be beneficial and profitable to all of us.’

Moments later, director Christopher Nolan took the stage to preview footage from his ambitious, large-format celluloid epic Dunkirk and offered a different view from Kroll, who is distributing his film. ‘The only platform I’m interested in talking about is theatrical exhibition,’ Nolan said. The usually quiet audience erupted into applause. Earlier, the director told The Associated Press that while the threat [of VOD]  is nothing new, it’s also not something filmmakers are, ‘particularly excited about.’

‘You really want your film to be in theaters as long as possible because that’s where they are meant to be seen,’ Nolan said. Indeed, most of the filmmakers sided with Nolan, including Arrival and Blade Runner 2049 director Denis Villeneuve, who said he will ‘always make movies for massive screens,’ and Downsizing director Alexander Payne. ‘I don’t work in television, I work in cinema and I like my films to be seen on the big screen. Period,’ Payne said.”

And yet the future of cinema is undoubtedly through streaming platforms, in digital cinema formats, however much we might want to return to the immersive nature of the theatrical experience, sharing a viewing of a film with a large audience. But theatrical exhibition, once the norm, is now becoming a niche format, except for the most grandiose blockbusters, which seemingly demand Dolby Surround Sound and IMAX screens.

Amazon may tout the virtues of theatrical distribution, but Manchester by The Sea would play just as well on the small screen as it does in theaters, and the bulk of Amazon’s product, such as Mozart in the Jungle and the forthcoming series The Last Tycoon, is distributed through streaming video, where Amazon makes most of its money.

So theatrical is superior, but in the end, streaming video will win out for home viewers.

Woody Allen’s New “TV” Series – on Amazon

Tuesday, January 13th, 2015

Woody Allen is doing his first “TV series” ever – with Amazon!

As always with Woody Allen, details are scarce, but Amazon has signed Allen to write and direct a full season of what is now being appropriately referred to as the “Untitled Woody Allen Project,” as the always reliable Nancy Tartaglione reports in Deadline. Of course, it’s not really a “TV series,” though it seems it will resemble one in format, because it’s only going to be on Amazon Prime. What a “full season” means these days is anyone’s guess, but I’m hoping it means at least 13 half-hours. As Tartaglione writes, “Amazon Studios broke new ground this weekend at the Golden Globes, winning its first major awards with the Best Television Series and Best Actor – Comedy or Musical statues going to Transparent.

Now, the streaming service is ramping up another first: signing Woody Allen to his first-ever TV series. Amazon has ordered a full season of the Untitled Woody Allen Project, which will premiere exclusively on Prime Instant Video. The Oscar-winner will write and direct the half-hour show whose logline is under wraps. (Allen previously penned an unaired sitcom pilot, The Laughmakers, for ABC in 1962.) An exact time frame was not provided for the project, however Amazon says its customers in the U.S., the UK and Germany will be able to see the series next year. Further details, including casting, are to come.

‘Woody Allen is a visionary creator who has made some of the greatest films of all-time, and it’s an honor to be working with him on his first television series,’ said Roy Price, Vice President of Amazon Studios. ‘From Annie Hall to Blue Jasmine, Woody has been at the creative forefront of American cinema and we couldn’t be more excited to premiere his first TV series exclusively on Prime Instant Video next year.’ Allen added, ‘I don’t know how I got into this. I have no ideas and I’m not sure where to begin. My guess is that Roy Price will regret this.'”

I love it! “No ideas and I’m not sure where to begin.” That’s the way to launch a series!

About the Author

Headshot of Wheeler Winston Dixon Wheeler Winston Dixon, Ryan Professor of Film Studies at the University of Nebraska-Lincoln, is an internationally recognized scholar and writer of film history, theory and criticism. He is the author of thirty books and more than 100 articles on film, and appears regularly in national media outlets discussing film and culture trends. Frame by Frame is a collection of his thoughts on a number of those topics. All comments by Dixon on this blog are his own opinions.

In The National News

Wheeler Winston Dixon has been quoted by Fast Company, The New Yorker, The New York Times, the BBC, CNN, The Christian Science Monitor, US News and World Report, The Boston Globe, Entertainment Weekly, The Los Angeles Times, NPR, The PBS Newshour, USA Today and other national media outlets on digital cinema, film and related topics - see the UNL newsroom at http://news.unl.edu/news-releases/1/ for more details.

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