Beyond the stars and product reels, NATO/ShoWest ’94 has included some sharp business talk, including confirmation Wednesday of distribution relationships struck between start-up Savoy Pictures and the United Artists Theatre Circuit and AMC Theatres.
The arrangements call for the UA circuit to exhibit all Savoy product in its theaters, while AMC will exhibit all Savoy movies in markets where it is not in head-to-head competition with UA. Savoy has such upcoming releases as director Garry Marshall’s comedy “Exit to Eden” the Ray Liotta action-adventure “No Escape” and director John Waters’ “Serial Mom.”
In total, the arrangements would automatically create an estimated 50% penetration for Savoy product nationwide — a major advantage for a company that debuted with “A Bronx Tale” just last fall. For their part UA and AMC are betting that Savoy will develop quickly into a consistent supplier of top product.
UA is the nation’s No. 1 exhibition chain, while AMC is strong in the Midwest and West Coast. Savoy would sell product in markets not covered by the UA and AMC agreements to other markets on a picture-by-picture basis.
In cutting the UA and AMC agreements, Savoy stands to gain significantly in its effort to establish itself as a domestic distributor. Those familiar with the arrangement said that the terms include a 90/10 distrib/exhib split structure. Alternatively, terms provide for Savoy to receive 70% aggregate of the first week’s gross and 60% aggregate of the second week’s — terms that rival those of established distribs.
Occasionally, larger Savoy movies would be negotiated on special terms. The arrangement is expected to be challenged by at least one major circuit, which is said to be questioning the arrangement on the grounds it would keep competitors from acquiring Savoy product in UA and AMC markets, violating antitrust regulations.
Proponents of the plan point to the wide array of product available to exhibitors in today’s marketplace, arguing that Savoy should be able to sell product on an exclusive basis to whichever companies it chooses.
Officials at Savoy, UA and AMC had no comment.
Lack of breakthroughs?
Elsewhere, the NATO/ShoWest trade show kicked off Tuesday afternoon with the typical booth-to-booth wars among purveyors of popcorn, gummy bears and ice cream, equipment suppliers and computer system sellers.
One addition to the trade show was National Film Service — the 48-year-old print delivery firm. After a challenge from Technicolor Entertainment Services, which has started delivering Buena Vista prints to theaters nationwide, as well as demonstrations of digital transmission of films over phone lines, National Film Service has taken a high profile at this year’s event.
National Film Service president Mark Frysztacki said, “I see NFS playing an important role in the years to come, and NATO/ShoWest is an important event to emphasize our status as the conduit between distributors and exhibitors.”
National Film Service introduced a new computerized inventory system called PrinTrack that keeps tabs on studio prints circulating around the country at its 33 nationwide depots in 28 states. “I would call it a dynamic leap forward technically for us,” Frysztacki said. “It doesn’t change what we do. It just makes us more efficient.”
Frysztacki attended Wednesday morning’s Theatre Equipment Assn. demonstration of electronic picture delivery by Sony and PacBell of digital real-time fiber-optic transmission, and criticized audio and visual dropouts in the presentation.
“I can’t deny that it is the wave of the future, but they are advocating that the image would be transmitted through a fiber-optic phone line in real time,” said Frysztacki, who prefers digital delivery via compact discs to phone lines. “There are real questions whether real-time fiber optic transmission would be cost-effective from a theatrical standpoint. They essentially gave a presentation formated for distributors to exhibitors.”