AMC Theaters CEO Adam Aron has found himself thrust into the spotlight in recent weeks, his company’s deal with Universal Pictures gives the latter the option to release its films on premium-on-demand just seventeen days after they screen in AMC Cinemas.
The deal will also make those films available on AMC’s recently launched on-demand service and includes PVOD profit sharing between the two companies, though specifics of that remain under wraps.
Two new facts have emerged. First, Universal must wait until their films have been in theaters for 10 days before making any announcement about a PVOD release. The other is that even when a film hits PVOD it will still be available in theaters.
As part of a quarterly earnings call this past week, Aron says their deal with Universal has been offered to the rest of Hollywood’s major studios and says he expects the new deal to become an industry standard. He’s also well aware of the flack he’ll get for it, but progress can’t be stopped:
“I expect this to become the industry standard. This potential dramatic expansion of revenue should protect AMC against the cannibalization that will admittedly occur as some people shift straight to home viewing. We cannot just live in the past and fear change. One has to stare change in the face and reshape it for one’s own benefit… Another studio executive told me, ‘Adam, you’re gonna get heat, but with this action, AMC may have just saved exhibition. We were gonna greenlight fewer movies. Now we will greenlight more.”
Aron says the deal came about in response to a more than decade-long trend in the box office as the financial performance of most films in theaters has become increasingly front-loaded – as much as 80% of a film’s theatrical viewing comes from the first 17 days of its theatrical run.
Aron also discussed the recent and even more drastic decision by Disney to give a day-and-date release for big-budget blockbuster “Mulan” on both PVOD and in select theaters at the same time. He says he’s understanding of the decision, telling investors:
“Mulan was supposed to go to market. It got delayed and delayed. They are under pressure. At some point they have to monetize their movie product. They have a huge slate for 2020 and we will benefit mightily. Most of all, it reaffirms the risk of [AMC] singing on to PVOD. The 17 days window would have been perfect for them.”
He also says he hopes Disney will consider adopting a model similar to theirs with Universal. Aron’s tune has changed dramatically from just five months ago when he led the charge against Universal for opting to release “Trolls World Tour” via on-demand and banning them. The ban, of course, has been revoked and Aron says “we would not have signed on to an economic program that we thought was a negative.”
Without options as PVOD, Aron says more and more projects will go straight to SVOD services: “Exhibition will not receive a penny on any of these movies. Our capital cost in someone’s couch at home is precisely zero.”
The comments come as two separate polls from both Variety and ComicBook.com have yielded effectively the same result – that only about 15% of those who participated plan to rent “Mulan” on the Disney+ service for $29.99. The polls yielded nearly 94,000 and just over 4,000 votes respectively.
Source: Variety
