Under the new deal between US movie theatre chain AMC Entertainment Holdings and Universal Pictures, movies will stay in theatres for much less time before moving online for home viewing.
This will change not only the way Hollywood has been dealing with movies, but it will also change the movie theatre business’ entire landscape, limiting their window to only 17 days from what used to be 75 days.
For movie goers, this means they’ll only have to wait a couple of weeks to stream a new release from the comfort of their home, pandemic or not.
A significant shift between AMC and Universal will most likely pressure other movie studios to follow in the same direction.
Even though movies traditionally generate the bulk of their box-office revenue in the first few weeks of playing in theaters, the fact that it could be readily available online only a couple of weeks after also threatens this exclusivity.
Why is this important?
Since before the pandemic, and arguably more so after, going to the movies has been less of an event and more of a time filler. Granted, there’s still something about movie theatre popcorn and seeing blockbusters on the big screen, especially when we have theatres with reclining features and blankets like in Bangkok.
However, the industry model is changing, and this means movie theatres will have to adapt with new business models.
Big movie theatre chains are integral enough to the entertainment business that they could potentially strike up deals with movie studios to diversify revenue. AMC will offer new Universal releases on its own streaming platform, AMC Theatres On Demand, for example.
AMC also succeeded in negotiating a share of the revenue new Universal movies will earn from digital rentals purchased on other platforms such as Apple TV and Amazon’s website. However, this privilege won’t apply to everyone in the ecosystem.
The question remains, will enough money be made? Or will movie studios have to really drum up its first week of theatrical release before it goes online at home.
Other theatre chains without this pull may find it more difficult going forward.