Exhibs Distressed By Slowest Showest

How did exhibs feel about this year’s NATO/Showest confab?

They felt snubbed.

Snubbed because many major distributors didn’t turn on the star power, didn’t sponsor major events, didn’t even show product reels.

“These people don’t give a damn about us anymore,” said one theater owner.

If they do, distribs aren’t expressing it very well. Unlike Showests of years past, this Vegas feel event packed no star power and had sparse studio exec attendance. Several majors, and their movies for 1991, were absent from view.

Julia Roberts did appear, briefly, with Kiefer Sutherland in tow, but she was getting a Showest award. Billy Crystal showed, with Rob Reiner, but he was being toasted “Comedy Star of the Decade.” Unlike the star-studded daises of previous Showests, this year’s events almost didn’t happen.

Warner Bros., which has sponsored a Showest event for every one of the last 13 years, hosted nothing and did not even set up a hospitality suite to show its 1991 product reel. President of distribution Barry Reardon explained that WB did not have time to put together a “first-class” spool.

Disney and Paramount, both of which have held extravaganzas in recent years, were invisible. Of the majors, only Columbia Tri-Star, Universal and MGM/UA had hospitality suites, the last two only opening after the conference was half over. Twentieth Century Fox was the sole studio to blow into town with a full head of steam, wowing a Thursday lunch audience with a 35-minute spool supporting film boss Joe Roth’s slate of 24 releases for 1991 alone (see story below).

And Orion, which did host a lunch, left exhibs bewildered when it showed no product reel – ostensibly the very purpose of the lunches.

Orion distribution/marketing head David Forbes explained that the high cost of producing a product reel “doesn’t enhance [Orion’s] ability to sell films.”

“What the hell are we doing here?” one confused exhib asked. “I thought [the product reel] was the whole point.”

Although total attendance numbers were not available, and although the trade show side of the convention was sold out, there appeared to be fewer participants than last year’s 5,200 registered guests. Event honcho Tim Warner predicted that “many of those [not attending] will be back in a major way” next year.

In the meantime, there was plenty of other bad news in the air. At seminars, over breakfasts and lunches and in private meetings, exhibs and distribs learned that production costs rose 14%, to an average budget of $26.8 million, and that advertising costs rose 26% to an average of $11.6 million. “We’re spending a fortune [on advertising],” Fox’ Tom Sherak admitted. “We’re spending ourselves silly.”

They learned that local, state and federal agencies around the country are planning to bring new “luxury” or “entertainment” taxes to bear on movie theaters.

They learned that the National Disability Act, which will go into effect in July of next year, will cost exhibs a lot of refurbishing and retrofitting money.

They learned that even though 1990 was a good year for B.O. totals, it saw fewer actual tickets sold than in 1982,1983,1984 or 1989. “We’ve doubled the number of screens, but we’re static on the number of persons,” AMC’s Stanley Durwood said at a fractious meeting between exhibs and studio distribution execs. “What I want to know is, where the hell are my customers?”

But mostly they learned that they are of decreasing importance to the people that make the movies. Domestic theatrical returns now add up to less than 30% – some say as low as 22% – of any film’s total revenue.

Motion Picture Assn. of America prexy Jack Valenti, in a spirited attack on overseas quotas, read them the news: while revenues from domestic theatrical rose only 6% last year and homevid growth was flat and tv dropped 1.5%, overseas theatrical jumped 16%, tv rose 29% and homevid leapt 39%. Carolco topper Peter Hoffman echoed those numbers and voiced the same sentiments, insisting that his company cannot and will not make movies solely for the domestic marketplace.

“[Distributors] and the studios are pushing really hard on foreign,” one theater owner said. “They’ve got no use for us.” National Assn. of Theater Owners prexy William Kartozian insisted that wasn’t the case. “The expanding foreign market is very important to all of exhibition,” he said. “As that market grows, our suppliers can derive more revenues, and that’s going to benefit [us] because more revenues equate into more product.”

Distribs, too, attempted to reassure theater owners, but they did so without much heart. “There is nothing more important [to us] than the American window,” WB’s Reardon insisted. “It drives everything else. But the U.S. has a problem [in returning revenues].” There were 75 million fewer people sitting in movie theaters in 1990 than in 1989, Reardon and others noted.

NATO wants to know why, and a committee headed by Cineplex Odeon’s Howard Lichtman will begin an ambitious survey of moviegoers. With financial commitments already in pocket from Disney and WB, Lichtman believes that NATO can find out, for real, why people aren’t going to movies anymore.

Already, Lichtman has ideas about what to do with the results. “If we can target the infrequent moviegoer… and get him back into the theaters, we’re looking at new revenues of over $1.1 billion to the industry,” Lichtman said. “We have to make bigger pies so that we can all have bigger pieces. But this is not pie in the sky. These people are there.”

Claudia Eller and Hy Hollinger Contributed To This Report.

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