Inside the Screening Room’s Bold Plan to Disrupt the Movie Business

Screening Room 50 dollar VOD Home
gary musgrave for Variety

Schedule a meeting with Sean Parker at, say, 10 a.m., and the tech guru will likely take hours to show up. People who work with the visionary entrepreneur, whose peripatetic career has taken him from Napster to Facebook to Spotify, refer to it as Sean Parker Time. It’s the cost of doing business with one of the boldest minds of the Internet Age.

“He has his finger on the Zeitgeist,” said Arianna Huffington, founder of the Huffington Post, and a friend. “He’s incredibly convincing about where the world is going.”

When it comes to movies, Parker believes that the future is a couch-based one, but that view has its detractors. Theaters have resisted efforts to shrink the time between a film’s debut on the big screen and its launch on home entertainment platforms. That resolve could crack, after news broke in Variety that Parker and partner Prem Akkaraju have teamed to launch Screening Room, a start-up that offers new releases in the home for $50 per 48-hour view, and have managed to enlist such high-wattage stakeholders as Steven Spielberg, Peter Jackson, J.J. Abrams, Martin Scorsese, Ron Howard and Brian Grazer. Hollywood’s biggest rainmaker, attorney Skip Brittenham, is representing Screening Room. Another industry vet, Jeff Blake, a former vice chairman of Sony Pictures, was recruited as a consultant.

“It’s the first real shot across the bow,” said David Weitzner, a former studio marketing chief. “There can’t be an exhibitor worth anything that doesn’t know this is where we’re headed. Short of surrendering and sticking their head in the sand, this is something both sides need to work on.”


Art House Theaters Slam Screening Room, Say Startup Encourages Piracy

Parker and Akkaraju are trying to broker a peace using a persuasive olive branch — money. Their plan is to give exhibitors $20 of the $50 fee, and to offer two free tickets to a movie in hopes of encouraging customers to visit a theater and buy concessions at a future date. Akkaraju has industry ties from stints as chief content officer at electronic music company SFX Entertainment and as global head of operations at Sanctuary Records Group, helping to guide its 2007 sale to Universal Music Group . He also has Wall Street ties, having worked at JPMorgan Entertainment Partners and Intermedia Partners.

To pitch their wares, Screening Room’s leaders and their reps have crossed the globe, flying to Philadelphia to meet with Comcast CEO Brian Roberts, whose entertainment conglom owns Universal, and touching down in China to pitch Dalian Wanda, the parent of AMC Theaters.

Screening Room appears close to a deal with AMC, poised to be the world’s largest exhibitor with its pending deal to buy Carmike Cinemas.

That said, the idea remains a tough sell to exhibitors, perhaps as daunting as the one Parker faced when he tried to convince the music industry to view Napster, the music-sharing site he founded, as friend, not foe. “There’s no way exhibitors would be willing to risk their windows on any regular basis, or on significant movies to get a piece of this,” said Bud Mayo, president of Carmike Cinemas’ alternative programming and distribution division.

Universal, Fox and Sony continue to study the venture, while other studios are still reluctant.

Producer Jonathan Taplin, director of the USC Annenberg Innovation Lab, called Screening Room “a little niche play.” Because of the proposed pricing, “There will be some very rich people who will want to set this up in their homes. But it’s not a mass-market product.”

Others see a big upside. Court Coursey, managing partner of the Silicon Valley investment fund TomorrowVentures, called the proposal “disruptive/non-disruptive,” adding: “It adds a new alternative. But it has a positive impact on everyone, from theater owners to filmmakers to studios. I think overall it increases revenue.”

Coursey said his own fund might consider investing in the venture. “There are about 10 people we co-invest with who would look at this opportunity in a heartbeat … I don’t think raising money for this is going to be their challenge.”

If most studios are unwilling to risk exhibitor anger by backing Screening Room, the business model could be imperiled. Success depends on the quality of the content, analysts say. With several highly anticipated summer blockbusters, such as a “Captain America” sequel and the “Ghostbusters” reboot, on the horizon, studios may be wary of angering exhibitors, particularly if they threaten not to show certain movies.

“This is a big leap, and I’m not sure either side is willing to take it,” said Eric Handler, an analyst at MKM Partners. “Studios and exhibitors have a good relationship right now.”

But Huffington noted that both sides face the innovator’s dilemma, the term for when successful industries get complacent and fail to embrace new technologies that drive future business.

“Often people who are making a lot of money now don’t see why they need to adjust,” she said. “They refuse to recognize how the world is changing.”

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  1. Galin McMahon says:

    I almost never go to the theaters anymore. People have become so rude that it’s just not enjoyable. So I wait and pay $1.50 at Redbox. I would be willing to pay $50 to see a movie I can’t wait to see. Think about the economy of it before poo pooing the plan.

  2. turkworks says:

    This is totally a mass market product! The best way to see a new movie is with lots of people. So just invite your friends and family over and have them pay part of the $50 fee. Problem solved! And yay for people with babies!

  3. Rex says:

    Gotta give these guys credit for drinking the Kool-aid like only the best zealots and talking like this WILL happen, even though it won’t, at least not in the way they’re predicting. It’s simple, really: NOT EVERYONE IS A FAMILY OF FOUR. For couples and singles, BY FAR the largest segment of moviegoers around the world, FIFTY BUCKS is downright laughable. The supporters of these kinds of D.O.A. “game changers” seem to think that every single person who goes to a movie theater uses half a tank of gas, pays for parking, and loads up on overpriced concessions because they’re saddled with spawn. THEY DO NOT and THEY ARE NOT. One person can see a movie for, what, $10-$12, maybe upwards of $12-$15 for 3D? Unless your only option is in the downtown core of a major metropolis (where it’s probably withing walking distance or a $3 bus ride anyway), parking at or near MOST suburban theaters is free, and no one is FORCED to buy concessions. Go as a couple, or with a friend, but STILL not pay for parking or concessions and you’re out, what, maybe $25-30 tops, and you get a nice communal experience AWAY from your home.

    Sure, Screening Room and its ilk may smell awesome for families of four or more who rarely go to the movies as it is, and are therefore gullible enough to buy into the hype at this early stage, but the REALITY is that the novelty — and short-lived feelings of adequacy at the water cooler the next day — WILL wear off as families in particular discover they STILL can’t find the time to sit the family down together to get their FIFTY BUCKS worth and then become increasingly behind-the-curve that they end up relying on the more common “watch it whenever the hell you want” streaming services that cost a LOT less.

  4. DougW says:

    Don’t know why Taplin thinks this is only for the rich. For some families, this would be cheaper than going to the theatre, especially when you add in concession prices. It reminds me of pay-per-view boxing, where millions are made and family and friends get together for an evening and share the cost.

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