Edge of 17
AMC Finally Throws Open the Theatrical Window
Oh which analogy to use… The action movie stand-off? The disaster movie burning building? A plane crash scene? A war movie? Maybe we’ll just stick to literal and metaphorical windows.
Imagine a crack creeping along a pane of glass with that unnerving noise getting louder and louder as you build to the realization that the window is going to shatter. Then an asteroid hits the Earth. The window didn’t shatter because it melted. Well, it probably didn’t even have time to do that. It instantly incinerated along with the rest of life as we know it.
That’s essentially what the COVID-19 pandemic has done to our world, and as such, the movie theater industry. In particular, the movie theater industry with their antiquated movie release windows.
So when I saw the headline today that the “war” between the nation’s largest theater chain, AMC, and one of the major movie studios, Universal, was over, I had to chuckle. This was a war in the same way that an ant is at war with a boot. AMC was threatening to ban Universal movies from their theaters — theaters, which, of course, are not open. Nor is there any sign they will open any time soon. At least not in this country. Whatever the opposite of leverage is, this was that.
And yet. It is still a bit surprising to see AMC acquiesce here. Yes, they had little choice. But the reality is that they’ve always had little choice. They just weren’t taking into account the appropriate time horizon previously. They were always going to lose this battle, but they couldn’t see it. Or more likely, chose not to see it. Because they could use the dwindling clout they had to keep pushing that time horizon further away.
And then COVID hit.
You almost — almost — have to feel sorry for AMC. I mean, they didn’t do themselves any favors in the past couple of decades by making the movie-going experience worse both by taking over the industry and formerly great theaters and ruining them. But still, they could not have seen the pandemic — one in which people cannot be in tight spaces near each other indoors — coming. There is no other option for them right now other than praying.
And so in that sense, AMC seemingly did okay with this outcome in that the window is not zero days. And they apparently are getting a cut of some of the digital revenue as well (presumably within the old 70-90 day window time horizon). So we now have a three-week (17 day) window for theaters. And then a newly pulled in window for digital distribution (meaning higher-priced movie rentals and perhaps purchases).
But make no mistake, this is a massive win for the studios. Because they probably didn’t really want a zero day window either. Now they’ll get to launch their blockbusters in theaters for as long as they want, and if they turn out not to be the blockbusters they hoped, they can push them into homes just a couple weeks later. The trend was already that big budget blockbusters were increasingly the only movies going to theaters in a meaningful way, and this will likely continue us down that path. Though there is a chance that some studios take a chance on some smaller films in theaters again because the window is so short. That seems like a generally good thing.
This is also a big win for studios because, as my friend Tom Conrad points out, the shorter window means they won’t have to double up their marketing spend (doing a ramp for theatrical then another one for home release). Again, only the biggest of blockbusters are going to be staying exclusively in theaters a day longer than 17 days now.
This is slightly less of a win for consumers. Still a nice win, but not the win that a zero day window would be, of course. It feels like a reasonable enough compromise — especially if you actually enjoy seeing movies in theaters, as I do! — assuming that all of the studios and movie chains follow suit with similar deals.
The reality is that the box office probably isn’t going to look all that different in this new world (assuming, of course, we not only defeat COVID but defeat the fear of going into tight germ boxes again). Again, things were already trending towards big blockbusters being the entire theatrical slate, with a mix of some low-budget horror and comedy to fill in the cracks. And yes, most movies make the vast majority of their box office in the first couple of weeks anyway.
This should also help the prestige fare which studios hope will garner awards, because again, they can release them now in theaters and keep talent happy, while recognizing that most still won’t make a ton of money that way, but they could do far better in the home 17 days later after garnering the critical buzz.
Asteroid metaphor aside, the theatrical window is still here. It’s just more like a porthole now. Made out of plastic. Ready to be blown away by the next stiff breeze that comes our way. Hopefully that’s not another pandemic. But if it is, at least we’ll have more to watch, sooner.
