AMC Bans Universal Films Over Direct-to-Steaming

lebeau

Well-Known Member
Original Poster
AMC’s Blacklist Of Universal Is A Risky Bluff Or A Major Mistake

AMC cannot afford to not to blacklist the studio which will release the likes of Minions 2, No Time to Die, Jurassic World: Dominion and F9.

Spurred by NATO’s displeasure over Universal UHS’s decision to release Trolls: World Tour not in a conventional global theatrical release but on “premium VOD” ($20-per-rental) and then further irked by Universal CEO Jeff Shell’s comments implying that the relative success of Trolls: World Tour’s at-home release ($95 million in 19 days) would lead to eventual loosening of the “hard” 90-day theatrical window, AMC has officially declared that it will no longer play Universal theatrical features. Yes, this is arguably saber-rattling for the sake of some kind of brokered peace, but it is a bluff. It has to be, because, especially right now, no major theater chain can survive, let alone thrive, without the movies Universal has in its pipeline.

Due to coronavirus-related theater closures and release date delays, Universal doesn’t have a major feature (presuming The Forever Purge indeed gets delayed from July 10) arriving in theaters until Nia Da Costa and Jordan Peele's Candyman on September 24. So there’s plenty of time for Universal and AMC to lob metaphorical missiles at each other all summer. As understandably annoyed as theater chains might be, this is a short-sighted and suicidal play from the biggest theater chain, one which was struggling with $5 billion in debts even before the global theatrical marketplace shut down. There’s no way AMC (or any major theater chain) gets back on their feet without the likes of F9, Minions 2, No Time to Die (overseas) and Jurassic World: Dominion.

Universal made a miscalculation both by not preemptively informing theater chains about their decisions regarding Trolls: World Tour and by trying to have it both ways in terms of VOD and theaters. They should have just said “Theaters are about to close, we want to have something big to offer for those stuck at home, and Trolls: World Tour is big enough to make a splash but not big enough to kill our bottom line,” then this likely would have been better received. It would be little different than Universal’s many direct-to-DVD sequels to their theatrical hits that flooded Blockbuster in the 2000’s. Quality-wise, Trolls: World Tour > American Pie: The Naked Mile, The Scorpion King 4 and The Land Before Time XIII: The Wisdom of Friends.

Shell’s comments do seem to affirm an intent to play around with the theatrical window once movie theaters are back in business, so this likely wasn’t a misunderstanding. Universal has been flirting with this idea for nearly a decade, when they threatened to release Brett Ratner’s October 2011 crime caper Tower Heist onto “$60-per-rental” VOD after its third week in theaters. They also openly discussed the logic, in late 2015, of releasing instant bombs like Jem and the Holograms onto VOD and DVD much sooner than the 90-100-day window would have allowed. Even Disney DIS was the studio that shortened the window to 90 days with Alice in Wonderland, a film that still earned $334 million domestic and $1.125 billion global in early 2010.

When studios talk about shortening the theatrical window, they aren’t necessarily talking about removing theaters from the equation. They are arguing for the right to release a bomb, the kind that leaves theaters in 14-21 days, onto VOD (or streaming) much faster than the conventional window would allow. In terms of big hits, they are trying to have it both ways, with best-case-scenario theatrical box office then leading to a near-immediate debut on “priced to own” electronic sell-through. Since most hit movies make most of their money in the first six weeks, the question is whether there is value to the studios in releasing those films onto VOD either as soon as they leave theaters and/or while they are still winding down their theatrical run.

Save for exceptions like Scream, The Sixth Sense, Frozen, The Greatest Showman and My Big Fat Greek Wedding (and awards-season contenders), most movies, even famously leggy ones, are mostly finished by the end of their second month. Most leggy blockbusters that come to mind (Inception, Shrek 2, Guardians of the Galaxy, How to Train Your Dragon, The Dark Knight, The Avengers, Toy Story 3, Spider-Man, Star Wars: The Force Awakens, Wonder Woman, Black Panther, Frozen II, etc.) earned 88-94% of their domestic cumes by the end of weekend six. And yes, films like Black Panther already debut in post-theatrical while still hanging around in theaters. The Ryan Coogler/Joe Robert Cole flick earned an additional $6.58 million, pushing it past $700 million, after its VOD debut.

I imagine we will see more “theater-worthy” movies going straight to PVOD or to a respective studio’s streaming service in the future. As audiences are less and less willing to see a variety of films in theaters, and this has been a huge problem for studios and theaters for the last five years, then more and more movies that once would have been likely theatrical hits are now likely to end up going straight to “post-theatrical.” When audiences get 90% of their cinematic diet from seasonal tentpoles, then everything else is a commercial risk. If you don’t see Amazon AMZN’s Late Night and Brittany Runs a Marathon in theaters, then The Report ends up with just a brief/token theatrical release before ending up on Amazon Prime.

If Universal thought Judd Apatow’s The King of Staten Island could do Trainwreck-level box office ($140 million global in 2015), they would have held it instead of dropping it on PVOD. If Warner Bros. thought Melissa McCarthy’s Superintelligence could do even Tammy-level business ($100 million on a $20 million budget in 2014) when theaters re-opened, they wouldn’t have sent the film to HBO Max. Ditto Sony selling Seth Rogen’s An American Pickle to HBO Max, as the likes of Neighbors ($271 million in 2014) or even This Is The End ($126 million in 2013) was a lifetime ago in terms of commercial play-ability. Trolls: World Tour was disconcerting because it was the first “straight-to-VOD” offering that had a prayer of being a theatrical smash.

There’s a difference between Universal sending Trolls: World Tour to PVOD and dating Minions 2: The Rise of Gru for July 2021. Every studio has had to make some kind of “We still believe in movie theaters” statement over the last two months, and to a certain extent that’s true. $95 million in VOD earnings for Trolls: World Tour is not, even accounting for a much larger portion of that going to the studios versus the 50/50 theaters/studio split, a game-changer. Universal literally had a once-in-a-lifetime captive audience and they still barely topped the $93 million ten-day-cume of Trolls’ domestic theatrical release in 2016. It will be profitable, but it’s not like Disney will look at these numbers and send Mulan to PVOD.

There is still no reasonable expectation that a VOD release of a would-be tentpole title, think Wonder Woman 1984 or No Time to Die, will earn anywhere near enough in global VOD (in participating marketplaces) to make up for what otherwise would have been a $650 million-to-$1.1 billion global theatrical gross. And yes, AMC theaters (along with the theaters with which they are aligned overseas) is a big part of that, so it’s not like Universal can walk away from the table quite yet. That said, if AMC is going to avoid bankruptcy (and not incur the wrath of the Wanda Group), they can’t afford to ignore Universal’s theatrical offerings. Universal has the biggest potential hits of any studio over the next couple of years.

While studios still need a global theatrical release for $100 million-$250 million movies, theaters require such tentpoles to sell concessions. Most moviegoers now only see the tentpoles (or relative “event movies”) in theaters while ignoring everything else. The top ten movies last year, of which only Sony’s Jumanji: The Next Level was not a comic book and/or Disney flick, accounted for $4.631 billion (40.6%) out of $11.4 billion domestic cume. Yes, Disney threw everything at the wall while Universal, WB and Paramount let them have their fun. Nonetheless, the big tentpole movies are needed for any multiplex chain that wishes to survive. For the next few years, Universal will have many of the biggest (F9, Jurassic World 3, etc.), so AMC needs their movies to survive.

I’m sympathetic to AMC and the National Association of Theater Owners’ concerns about what Trolls: World Tour does or doesn’t mean for theatrical moviegoing. But this could have been handled on a movie-by-movie basis (as Regal has announced in terms of not playing Universal releases that break the theatrical window) rather than a blanket ban that only makes AMC look foolish in hindsight. Candyman opens just under five months from today, so I imagine this will be resolved before that film’s new opening day. I can sympathize with Universal wanting to experiment with the theatrical window when audiences are so reluctant to see non-tentpole flicks in theaters. Nonetheless, the studios and the theaters need each other, at least for a few more years. Let’s hope that Trolls: World Tour doesn’t become the Hollywood equivalent of Archduke Ferdinand.
 

Twilight_Roxas

Well-Known Member
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Regal join as well.
 

seascape

Well-Known Member
AMC’s Blacklist Of Universal Is A Risky Bluff Or A Major Mistake

AMC cannot afford to not to blacklist the studio which will release the likes of Minions 2, No Time to Die, Jurassic World: Dominion and F9.

Spurred by NATO’s displeasure over Universal UHS’s decision to release Trolls: World Tour not in a conventional global theatrical release but on “premium VOD” ($20-per-rental) and then further irked by Universal CEO Jeff Shell’s comments implying that the relative success of Trolls: World Tour’s at-home release ($95 million in 19 days) would lead to eventual loosening of the “hard” 90-day theatrical window, AMC has officially declared that it will no longer play Universal theatrical features. Yes, this is arguably saber-rattling for the sake of some kind of brokered peace, but it is a bluff. It has to be, because, especially right now, no major theater chain can survive, let alone thrive, without the movies Universal has in its pipeline.

Due to coronavirus-related theater closures and release date delays, Universal doesn’t have a major feature (presuming The Forever Purge indeed gets delayed from July 10) arriving in theaters until Nia Da Costa and Jordan Peele's Candyman on September 24. So there’s plenty of time for Universal and AMC to lob metaphorical missiles at each other all summer. As understandably annoyed as theater chains might be, this is a short-sighted and suicidal play from the biggest theater chain, one which was struggling with $5 billion in debts even before the global theatrical marketplace shut down. There’s no way AMC (or any major theater chain) gets back on their feet without the likes of F9, Minions 2, No Time to Die (overseas) and Jurassic World: Dominion.

Universal made a miscalculation both by not preemptively informing theater chains about their decisions regarding Trolls: World Tour and by trying to have it both ways in terms of VOD and theaters. They should have just said “Theaters are about to close, we want to have something big to offer for those stuck at home, and Trolls: World Tour is big enough to make a splash but not big enough to kill our bottom line,” then this likely would have been better received. It would be little different than Universal’s many direct-to-DVD sequels to their theatrical hits that flooded Blockbuster in the 2000’s. Quality-wise, Trolls: World Tour > American Pie: The Naked Mile, The Scorpion King 4 and The Land Before Time XIII: The Wisdom of Friends.

Shell’s comments do seem to affirm an intent to play around with the theatrical window once movie theaters are back in business, so this likely wasn’t a misunderstanding. Universal has been flirting with this idea for nearly a decade, when they threatened to release Brett Ratner’s October 2011 crime caper Tower Heist onto “$60-per-rental” VOD after its third week in theaters. They also openly discussed the logic, in late 2015, of releasing instant bombs like Jem and the Holograms onto VOD and DVD much sooner than the 90-100-day window would have allowed. Even Disney DIS was the studio that shortened the window to 90 days with Alice in Wonderland, a film that still earned $334 million domestic and $1.125 billion global in early 2010.

When studios talk about shortening the theatrical window, they aren’t necessarily talking about removing theaters from the equation. They are arguing for the right to release a bomb, the kind that leaves theaters in 14-21 days, onto VOD (or streaming) much faster than the conventional window would allow. In terms of big hits, they are trying to have it both ways, with best-case-scenario theatrical box office then leading to a near-immediate debut on “priced to own” electronic sell-through. Since most hit movies make most of their money in the first six weeks, the question is whether there is value to the studios in releasing those films onto VOD either as soon as they leave theaters and/or while they are still winding down their theatrical run.

Save for exceptions like Scream, The Sixth Sense, Frozen, The Greatest Showman and My Big Fat Greek Wedding (and awards-season contenders), most movies, even famously leggy ones, are mostly finished by the end of their second month. Most leggy blockbusters that come to mind (Inception, Shrek 2, Guardians of the Galaxy, How to Train Your Dragon, The Dark Knight, The Avengers, Toy Story 3, Spider-Man, Star Wars: The Force Awakens, Wonder Woman, Black Panther, Frozen II, etc.) earned 88-94% of their domestic cumes by the end of weekend six. And yes, films like Black Panther already debut in post-theatrical while still hanging around in theaters. The Ryan Coogler/Joe Robert Cole flick earned an additional $6.58 million, pushing it past $700 million, after its VOD debut.

I imagine we will see more “theater-worthy” movies going straight to PVOD or to a respective studio’s streaming service in the future. As audiences are less and less willing to see a variety of films in theaters, and this has been a huge problem for studios and theaters for the last five years, then more and more movies that once would have been likely theatrical hits are now likely to end up going straight to “post-theatrical.” When audiences get 90% of their cinematic diet from seasonal tentpoles, then everything else is a commercial risk. If you don’t see Amazon AMZN’s Late Night and Brittany Runs a Marathon in theaters, then The Report ends up with just a brief/token theatrical release before ending up on Amazon Prime.

If Universal thought Judd Apatow’s The King of Staten Island could do Trainwreck-level box office ($140 million global in 2015), they would have held it instead of dropping it on PVOD. If Warner Bros. thought Melissa McCarthy’s Superintelligence could do even Tammy-level business ($100 million on a $20 million budget in 2014) when theaters re-opened, they wouldn’t have sent the film to HBO Max. Ditto Sony selling Seth Rogen’s An American Pickle to HBO Max, as the likes of Neighbors ($271 million in 2014) or even This Is The End ($126 million in 2013) was a lifetime ago in terms of commercial play-ability. Trolls: World Tour was disconcerting because it was the first “straight-to-VOD” offering that had a prayer of being a theatrical smash.

There’s a difference between Universal sending Trolls: World Tour to PVOD and dating Minions 2: The Rise of Gru for July 2021. Every studio has had to make some kind of “We still believe in movie theaters” statement over the last two months, and to a certain extent that’s true. $95 million in VOD earnings for Trolls: World Tour is not, even accounting for a much larger portion of that going to the studios versus the 50/50 theaters/studio split, a game-changer. Universal literally had a once-in-a-lifetime captive audience and they still barely topped the $93 million ten-day-cume of Trolls’ domestic theatrical release in 2016. It will be profitable, but it’s not like Disney will look at these numbers and send Mulan to PVOD.

There is still no reasonable expectation that a VOD release of a would-be tentpole title, think Wonder Woman 1984 or No Time to Die, will earn anywhere near enough in global VOD (in participating marketplaces) to make up for what otherwise would have been a $650 million-to-$1.1 billion global theatrical gross. And yes, AMC theaters (along with the theaters with which they are aligned overseas) is a big part of that, so it’s not like Universal can walk away from the table quite yet. That said, if AMC is going to avoid bankruptcy (and not incur the wrath of the Wanda Group), they can’t afford to ignore Universal’s theatrical offerings. Universal has the biggest potential hits of any studio over the next couple of years.

While studios still need a global theatrical release for $100 million-$250 million movies, theaters require such tentpoles to sell concessions. Most moviegoers now only see the tentpoles (or relative “event movies”) in theaters while ignoring everything else. The top ten movies last year, of which only Sony’s Jumanji: The Next Level was not a comic book and/or Disney flick, accounted for $4.631 billion (40.6%) out of $11.4 billion domestic cume. Yes, Disney threw everything at the wall while Universal, WB and Paramount let them have their fun. Nonetheless, the big tentpole movies are needed for any multiplex chain that wishes to survive. For the next few years, Universal will have many of the biggest (F9, Jurassic World 3, etc.), so AMC needs their movies to survive.

I’m sympathetic to AMC and the National Association of Theater Owners’ concerns about what Trolls: World Tour does or doesn’t mean for theatrical moviegoing. But this could have been handled on a movie-by-movie basis (as Regal has announced in terms of not playing Universal releases that break the theatrical window) rather than a blanket ban that only makes AMC look foolish in hindsight. Candyman opens just under five months from today, so I imagine this will be resolved before that film’s new opening day. I can sympathize with Universal wanting to experiment with the theatrical window when audiences are so reluctant to see non-tentpole flicks in theaters. Nonetheless, the studios and the theaters need each other, at least for a few more years. Let’s hope that Trolls: World Tour doesn’t become the Hollywood equivalent of Archduke Ferdinand.
How does this affect their contract with Bloomhouse? Also, what about their contract with Marvel for the Hulk standalone movie distribution? If they are blocked by the theater owners do they keep those rights? Plus, as long as the other studios keep the theatrical window, the theaters will be fine and it's Comcast that loses. I love seeing the movies on the big screen and want them to win this battle.
 

Twilight_Roxas

Well-Known Member
How does this affect their contract with Bloomhouse? Also, what about their contract with Marvel for the Hulk standalone movie distribution? If they are blocked by the theater owners do they keep those rights? Plus, as long as the other studios keep the theatrical window, the theaters will be fine and it's Comcast that loses. I love seeing the movies on the big screen and want them to win this battle.
Blumhouse is with Warner Bros as well.
 

JT3000

Well-Known Member
How does this affect their contract with Bloomhouse? Also, what about their contract with Marvel for the Hulk standalone movie distribution? If they are blocked by the theater owners do they keep those rights? Plus, as long as the other studios keep the theatrical window, the theaters will be fine and it's Comcast that loses. I love seeing the movies on the big screen and want them to win this battle.

Of course you do. Except Universal isn't actually pulling their films from theaters, they've just proven they could get away with it if they wanted to. AMC is overreacting from a place of desperation and will be the ones paying for it.

What is AMC going to replace that content with? They don't make the movies, they just screen them.

They'll still run Universal's films, but they'll be sweded by AMC staff.
 

seascape

Well-Known Member
Of course you do. Except Universal isn't actually pulling their films from theaters, they've just proven they could get away with it if they wanted to. AMC is overreacting from a place of desperation and will be the ones paying for it.



They'll still run Universal's films, but they'll be sweded by AMC staff.
Universal said they were goung to simultaneously release their movies to streaming and theaters. As a result AMC, Regsl and the National Theaters Owners Association said they would not show any Universal movies. It is not me saying that but theaters. Please look it up.
 

Jon81uk

Well-Known Member
I get where AMC are coming from on this. For 2020 it makes sense for distributors to release on PVOD as people aren't going to theaters. But in 2021 hopefully theaters are open and if films are still on PVOD at the same time as theatrical release it could be a big drop in sales for theaters.
 

seascape

Well-Known Member
I get where AMC are coming from on this. For 2020 it makes sense for distributors to release on PVOD as people aren't going to theaters. But in 2021 hopefully theaters are open and if films are still on PVOD at the same time as theatrical release it could be a big drop in sales for theaters.
Theater owners need help today and for studios, that have made billions off the existing model to say they don't care and only want what is best forvthem today and tomorrow is wrong. If the studio owners refuse to support the theatrical window today, they shouldn't be allowed to take advantage of it in the future. AMC, Regal and every theater owner needs to protect their businesses and that means only show movies from studios that follow the current model. Yes, the window could be shortened to say 6 weeks but it needs to exist. Universal is wrong here and if they do as they said the theaters have to boycott them.
 

lebeau

Well-Known Member
Original Poster
I get where AMC are coming from on this. For 2020 it makes sense for distributors to release on PVOD as people aren't going to theaters. But in 2021 hopefully theaters are open and if films are still on PVOD at the same time as theatrical release it could be a big drop in sales for theaters.

Let's see who blinks first, bet its the theatres

I fully expect both sides will come to the negotiating table before any movies miss their theatrical release. The studios led by Universal will continue chipping away at the 90-day window. I wouldn't be surprised to see a sliding scale tied to box office performance. The window still applies to hit movies, but box office bombs that disappeared from theaters quickly can go to streaming before they fade from memory. The exhibitors won't be happy about it, but they only have so much negotiating power. Universal may be leading the charge, but all the other studios are lined up silently behind them. The theaters will give up something and everyone will go back to making money.
 

JT3000

Well-Known Member
Universal said they were goung to simultaneously release their movies to streaming and theaters. As a result AMC, Regsl and the National Theaters Owners Association said they would not show any Universal movies. It is not me saying that but theaters. Please look it up.

Yeah... except that's not what they said at all. They said VOD was something they'd like to explore more in the future. They never said or even suggested all of their movies would be released that way from now on. You're also wrong about Regal not showing Universal films.


Theater owners need help today and for studios, that have made billions off the existing model to say they don't care and only want what is best forvthem today and tomorrow is wrong. If the studio owners refuse to support the theatrical window today, they shouldn't be allowed to take advantage of it in the future. AMC, Regal and every theater owner needs to protect their businesses and that means only show movies from studios that follow the current model. Yes, the window could be shortened to say 6 weeks but it needs to exist. Universal is wrong here and if they do as they said the theaters have to boycott them.

Support the theatrical window today? What theatrical window? The theaters are all closed!!! As usual, you're putting your own spin on this and ignoring the facts. Universal is exploring their options for delivering their product to consumers during this unusual time. Are they hoping to leverage their successes now to gain concessions from theater chains in the future? Perhaps, but no one ever said they were ditching theaters altogether. That's preposterous. And AMC could have negotiated all this in private, but instead they decided to make a hysterical public reaction that will come back to bite them. They need Univeral more than Universal needs them, and chances are the other studios are thinking the same thing right now. AMC are setting themselves up for failure at a time when they're nearly bankrupt in the first place.
 

Tony Perkis

Well-Known Member
Considering there isn't a single new release until Christopher Nolan's Tenet, this feels like an empty threat.

AMC's credit rating has taken a significant hit due to their expansion plans funded primarily by debt over the past several years in conjunction with the obviously devastating impact from COVID-19, so unless they have a plan to support themselves with primarily Disney films or are positioning themselves to get bought out by a major studio (which the current Administration and the Supreme Court is open to possibly relaxing the United States vs. Paramount Pictures ruling, making this a possibility), they can't responsibly follow through on this.

Regal jumping in doesn't really create any more pressure for Universal. Film studios have the power here: they have the resources to withstand the shutdown (though I'm worried about companies like A24 and Neon), they have the product that drives people to theatres, and they have the streaming and sales outlets to bypass theatres in the worst case scenario.

There is no way theatre chains are going to stick to this.
 
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WDWFREAK53

Well-Known Member
I was excited to see that Trolls was a success because (from a completely selfish and personal reason) I don't get out to the theaters that often (I do make a point to see the big blockbusters (Marvel, Star Wars, etc. and usually bring the kids to see a Disney flick)) but there are usually handfuls of movies per year that I'd love to see. Sure, I can wait for OnDemand but when the films go to OnDemand, my urge to see them fades and I usually just watch them when they hit the premium channels. To me, if I'm going to pay $6 to rent it months after most have seen it, I might as well just wait...whereas if I could spend $20 for my wife and I and see it with the masses, I would do it.

Does this mean I want theaters to close up? No way...I love going to the theater and being immersed in a huge IMAX experience...but I don't need to see a movie like Jojo Rabbit in IMAX either. (Not that Jojo Rabbit went to IMAX...just using it as an example of a more "artsy" film that didn't need to be seen in a giant theater on a giant screen to enhance the experience).

I'd also love to see Drive-Ins make a comeback. Put in new screens with the correct aspect ratio, crystal clear projectors, and on HD radio signals and I think you'd see the rebirth of a bygone era.
 
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