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See All The Movies You Want For $10 A Month?

Wednesday, August 16th, 2017

Under a new proposal, you could pay $10 a month, and see a new movie every day.

As Isabel Gottlieb reports in Bloomberg News, under a new scheme proposed by one of the co-founders of Netflix, you could go to the movies every day for a month for just $10. Sound impossible? Maybe it is – but “as movie theaters struggle with tepid sales, Mitch Lowe has an extreme proposal for how to get more people into seats: Let them come to all the showings they want for about the price of a single ticket each month.

Lowe, an early Netflix Inc. executive who now runs a startup called MoviePass, plans to drop the price of the company’s movie ticket subscriptions on Tuesday to $9.95. The fee will let customers get in to one showing every day at any theater in the U.S. that accepts debit cards. MoviePass will pay theaters the full price of each ticket used by subscribers, excluding 3D or Imax screens.

MoviePass could lose a lot of money subsidizing people’s movie habits. So the company also raised cash on Tuesday by selling a majority stake to Helios and Matheson Analytics Inc., a small, publicly traded data firm in New York. The companies declined to comment on terms of the financing but said MoviePass intends to hold an initial public offering by March. Helios and Metheson shares rose 5.7 percent to $2.95 at the close Tuesday in New York.

Ted Farnsworth, chief executive officer at Helios and Matheson, said the goal is to amass a large base of customers and collect data on viewing behaviors. That information could then be used to eventually target advertisements or other marketing materials to subscribers. ‘It’s no different than Facebook or Google,’ Farnsworth said. ‘The more we understand our fans, the more we can target them. . . .’

Lowe, a fixture of the home video business who helped get Netflix off the ground and served as president of rental-kiosk operator Redbox, was named CEO last year. The privately held company declined to disclose subscriber numbers or financial information. Lowe said the data-based business model is still ‘years in the future.’

With the new strategy, MoviePass hopes to resolve what Lowe sees as the biggest factor to blame for the theater industry’s decline. He said the high price of tickets, not competition from Netflix or Amazon.com Inc.’s Prime Video service, is a big part of what’s keeping people away.” Could it work? Well, I know that one of the factors impacting theater going is the price, and I think it’s true that –

“People really do want to go more often,” Lowe said. “They just don’t like the transaction.”

Movie Theaters’ $1.3 Billion Stock Collapse

Friday, August 4th, 2017

2017 hasn’t been that great for movie box office figures – what does the future hold?

As Anousha Sakoui and Emma Orr report on the Bloomberg News website, “Hope is fading for a feel-good ending at the U.S. box office. After several months of flops like Warner Bros.’ King Arthur and EuropaCorp’s Valerian, movie studios and theaters are beginning to acknowledge that their streak of record-setting ticket sales may be coming to an end. AMC Entertainment Holdings Inc., the world’s biggest cinema chain, laid out a worse-than-projected outlook for the North American box office this week.

That announcement dragged down shares of theater stocks, wiping out $1.3 billion from the value of the top four cinema operators in North America since Aug. 1. Even with a new Star Wars, a Marvel superhero movie and the sequel to Blade Runner on the docket for the holiday season, the box office is unlikely to make up for a ‘severe hit’ in the third quarter, according to Bloomberg Intelligence. To date, receipts are down 2 percent in 2017, and AMC is projecting a 1.5 percent decline for the full year.

The concern is that the slump isn’t just a run of bad luck. Cinema operators have managed for years to keep increasing sales by raising ticket prices amid stagnant attendance, but a sharp drop in film going would make that harder to sustain. And the tried-and-true formula of churning out big-budget sequels and cinematic universes populated with super beings seems to be wearing on film goers. Movies featuring once-reliable draws Jack Sparrow, the Transformers and the Mummy did poorly in the U.S.

Meanwhile, competition is heating up. Netflix Inc. and other digital distributors are creating more original movies, and consumers have more demands on their attention than ever, from Snapchat to YouTube. Further exacerbating the trend, studios are expected to push for a new premium video-on-demand window this year.

It’s possible that Hollywood could reverse the trend next year, when a new movie about Han Solo, an Avengers film, and sequels to Deadpool and Jurassic World are scheduled. ‘This is very typical of the movie business,’ said Paul Sweeney, an analyst at Bloomberg Intelligence. ‘You could make the argument that the slate for next year looks really good, which should grow the market next year in North America. That part’s a cyclical thing, and it’s likely to come back.’

And movie-theater operators Regal Entertainment Group, Cinemark Holdings Inc. and Imax Corp. aren’t facing the same level of pressure as AMC, which is carrying almost $5 billion in debt after expanding its empire to Europe, with acquisitions in the U.K. and Sweden.

Controlled by Chinese billionaire Wang Jianlin’s Dalian Wanda Group Co., AMC has become the poster child for China’s incursion into Hollywood. Concern that Dalian Wanda’s international investments may wane is adding to AMC’s troubles. ‘With China cracking down on funding for AMC’s majority shareholder, Dalian Wanda, the cinema chain faces murky prospects given its high debt level and appetite for global M&A,’ wrote Geetha Ranganathan, a Bloomberg Intelligence analyst.”

Now, it could be that we’re just going through a run of bad films – or it could be, as Sakoui and Orr note, that “the tried-and-true formula of churning out big-budget sequels and cinematic universes populated with super beings seems to be wearing on film goers.” I’d argue it’s the latter, and though a new Star Wars or Marvel film may come along that rocks the box office, eventually this is a formula that’s bound to collapse. The figures above show it – theatrical box office is steadily going down.

But then again, what are the theaters to do? Audiences have been force fed junk for so long that they no longer know what a more thoughtful, challenging film looks like – they wouldn’t know how to approach anything that doesn’t have three act plot format, cardboard cutout characters, and a massive dose of CGI. Can you imagine if Ingmar Bergman’s Persona were released theatrically today? Or Federico Fellini’s La Dolce Vita (which incidentally, holds the record for the biggest box office success for any foreign subtitled film to this day, adjusted for inflation)?

No one would come. Contemporary audiences only want genre films, franchise films, spectacle films, and superhero/heroine films. That’s it. And furthermore, theaters are locked into multi-year contracts stretching into the next decade for upcoming films from Marvel, DC, Disney, Lucasfilm (bearing in mind that Marvel and Lucasfilm are part of Disney) so they have to run their films no matter what.  What are theater owners to do? They could convert their auditoriums into gigantic videogame parlors, with multiplayer games on the screen, but that, too, would eventually fade.

The future is online. The future is streaming. The future is Netflix, Amazon, Hulu and similar companies. The future is people sitting in their living room watching web series, or feature films, on their 50″ plasma, streaming from the web, or cable – if they still live in the dark ages – but the future is not in movie theaters. It costs too much to go out, the prices at the concession stand are out of control (it’s really the only way the multiplexes can make any money), and furthermore, in today’s violent society, theaters are simply not safe. And with Amazon and Netflix making their own features, distributed through their own online network, who needs movie theaters?

The outlook for theatrical exhibition is grim indeed – what can turn it around?

Artificial Intelligence is Transforming The Web

Thursday, February 4th, 2016

As Cade Metz writes in a great article in Wired, AI technology is transforming the web – and the world.

As Metz writes, “yesterday, the 46-year-old Google veteran who oversees its search engine, Amit Singhal, announced his retirement. And in short order, Google revealed that Singhal’s rather enormous shoes would be filled by a man named John Giannandrea. On one level, these are just two guys doing something new with their lives. But you can also view the pair as the ideal metaphor for a momentous shift in the way things work inside Google—and across the tech world as a whole.

Giannandrea, you see, oversees Google’s work in artificial intelligence. This includes deep neural networks, networks of hardware and software that approximate the web of neurons in the human brain. By analyzing vast amounts of digital data, these neural nets can learn all sorts of useful tasks, like identifying photos, recognizing commands spoken into a smartphone, and, as it turns out, responding to Internet search queries. In some cases, they can learn a task so well that they outperform humans. They can do it better. They can do it faster. And they can do it at a much larger scale. If AI is the future of Google Search, it’s the future of so much more.

This approach, called deep learning, is rapidly reinventing so many of the Internet’s most popular services, from Facebook to Twitter to Skype. Over the past year, it has also reinvented Google Search, where the company generates most of its revenue. Early in 2015, as Bloomberg recently reported, Google began rolling out a deep learning system called RankBrain that helps generate responses to search queries. As of October, RankBrain played a role in “a very large fraction” of the millions of queries that go through the search engine with each passing second.

As Bloomberg says, it was Singhal who approved the roll-out of RankBrain. And before that, he and his team may have explored other, simpler forms of machine learning. But for a time, some say, he represented a steadfast resistance to the use of machine learning inside Google Search. In the past, Google relied mostly on algorithms that followed a strict set of rules set by humans. The concern—as described by some former Google employees—was that it was more difficult to understand why neural nets behaved the way it did, and more difficult to tweak their behavior.

These concerns still hover over the world of machine learning. The truth is that even the experts don’t completely understand how neural nets work. But they do work. If you feed enough photos of a platypus into a neural net, it can learn to identify a platypus. If you show it enough computer malware code, it can learn to recognize a virus. If you give it enough raw language—words or phrases that people might type into a search engine—it can learn to understand search queries and help respond to them. In some cases, it can handle queries better than algorithmic rules hand-coded by human engineers. Artificial intelligence is the future of Google Search, and if it’s the future of Google Search, it’s the future of so much more.”

A perceptive look at the future we all share; read the entire article here.

A Bad Day For Traditional Media

Wednesday, August 5th, 2015

Traditional media stocks are taking a beating today, as consumers move away from television for the web.

As Cecile Daurat reports on the Bloomberg News website, “Walt Disney Co.’s darkened outlook dragged down media stocks from Time Warner Inc. to 21st Century Fox Inc. and CBS Corp.

Disney, which through Tuesday had been the top-performing stock in the Dow Jones Industrial Average this year with a record of stellar sales and profit, surprised investors by posting lower-than-estimated quarterly revenue and cutting its forecast for cable-television profit.

Disney’s shares slumped as much as 10 percent — the most since August 2011 — after the results, while Fox and CBS Corp., which both report earnings after the close, dropped more than 5 percent. Time Warner and Scripps Networks Interactive Inc., the owner of Food Network and HGTV, also fell even though they beat second-quarter earnings predictions. Overall, the Bloomberg U.S. Media Index had its biggest intraday decline in almost four years.

‘Investors are definitely reading across the Disney earnings and extrapolating it to the broader media sector,’ said Paul Sweeney, an analyst at Bloomberg Intelligence.

Disney is facing two challenges of it own: fewer subscribers at cable networks such as ESPN, its biggest business, and foreign exchange losses from the strong dollar that are hurting both cable TV and international theme parks.

But the concerns over ESPN’s growth and comments on affiliate revenue from pay-TV providers, which Disney now expects to fall short of previous forecasts, may be a gauge for other media companies.

Both Time Warner and Fox are doubling down on exclusive live sports programming to demand higher fees for their channels from pay-TV distributors. And those higher fees have helped them fuel earnings growth in recent quarters. Investors will get an update on Fox and CBS, which has also pushed into sports programming, when the companies post results.

Time Warner’s decision to keep its full-year profit forecast after second-quarter earnings per share beat analysts’ predictions by a wide margin also weighed on the stock Wednesday. Maintaining the guidance suggested estimates for the second half may be too high, Sweeney said. Shares of the New York-based owner of HBO were down 7 percent to $81.49 at 12:55 p.m. in New York.

Discovery, which dropped 9.5 percent to $29.74, posted results that fell short of sales and earnings estimates Wednesday. The cable-TV company still increased its outlook for annual earnings-per-share growth, excluding foreign exchanges.

Cable-TV stocks like Scripps and Viacom Inc. suffered after Disney cut its forecast for cable profit. For fiscal 2013 to 2016, the entertainment giant had promised profit growth in the high-single-digit range. Now, with just five quarters to go, the company expects a mid-single-digit gain for the division over that time frame.”

This is sort of a late wake-up call to something that has been building for a long time; look at the frame grabbed chart at the top (click here, on the image above, to see a Bloomberg video on this whole topic, with some really sharp analysis). Netflix is going through the roof with subscribers, while traditional media – i.e. television and cable – is essentially flatlining.

This has been coming for a long time, and it’s sort of a seismic shock to the system for all involved, but Netflix is really taking over the whole viewing sphere, allowing people to see whatever they want, whenever they want, wherever they want, and also to cut free of the “bundling” that cable systems force on customers, paying for what really want and nothing else.

This is just the first shot in a new system of distribution that has been building for quite a while; I’m really surprised it has taken traditional media this long to notice that frankly, they’re in long term trouble. There’s no way this trend is turning around, and what happens next is -as far as I can see- that Netflix gets bigger and bigger, and traditional media becomes less and less relevant to millennials.

We’ll have to see what happens next.

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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