Theater owners from around the world converge next week on CinemaCon, the annual exhibition tradeshow in Las Vegas, eager for studios to unveil the big gambles they’re taking on the latest comicbook movies and franchise fare.
While slot machines clang just out of earshot, and tourists huddle around blackjack tables, cinema execs will retreat inside the theater at Caesars Palace to get a sneak peek at clips from he likes of “Star Wars: Episode VII — The Force Awakens,” “Jurassic World,” “Spectre” and “The Avengers: Age of Ultron.” It’s Hollywood’s equivalent of a royal flush.
On paper, they all look like smart bets; many industry analysts predict that 2015 will be the first year to cross $11 billion in domestic ticket sales.
“It looks like a big bounceback year,” said Robert Copple, president and chief operating officer of Cinemark. “It’s an incredible opportunity for me to see what’s coming not just this year, but into 2016 and beyond. That helps me know what my business is going to look like.”
What a difference 12 months makes. Last year’s CinemaCon was shrouded in a somber air, as evidence mounted that 2014’s crop of would-be blockbusters were welterweights. The pessimism proved well-founded, with the U.S. box office ending the year down 5.2% from 2013.
That hasn’t been the only pressure point of late. The threat of a shortened window between a film’s theatrical debut and its home-entertainment premiere has reignited tensions. Facing terror threats, Sony Pictures’ “The Interview” was pulled from all major circuits, then premiered on digital and on-demand platforms as well as in limited theatrical release.
Movie-theater owners and studio executives say “The Interview” was an anomaly, but that’s not the only bone of contention. Netflix is spending heavily on feature films like “Beasts of No Nation” and a sequel to “Crouching Tiger, Hidden Dragon,” while premiering them simultaneously on its streaming service, or forgoing a theatrical release entirely. MGM’s “Hot Tub Time Machine 2” became available digitally just 46 days after theatrical release, a short window for a studio film.
But National Assn. of Theatre Owners CEO John Fithian, who helped craft the exhibition industry’s response to the last great windows crisis, argues this situation is different from the scuffle cinemas had with studios in 2011. In that case, four major studios were pushing to release films on DirecTV 60 days after they bowed in theaters, reducing the standard window by a month.
“The big public debates with major distributors aren’t happening,” he said. “The issues are on the periphery, with Netflix and other companies that offer content for the home, and don’t care about the theatrical experience.”
Netflix could prove to be just as disruptive when it comes to windowing as it was regarding the demise of DVDs and Blu-rays — it’s difficult to convince consumers to pay for something they can stream for a monthly subscription fee from the comfort of their own home.
That leads to generational challenges for studios: Younger viewers aren’t showing up at the same levels they once did, raising questions about the long-term viability of an entertainment form that must compete with videogames and cheaper online forms of entertainment.
To help differentiate the theatrical experience from the one widely available in living rooms, exhibitors have outfitted theaters with 3D projectors and reclining seats, while experimenting with alcoholic beverage service. In the short run, the results have been encouraging, helping boost earnings at major theater chains and offsetting the box office downturn.
“The industry is in very good shape,” said Eric Handler, an analyst with MKM Partners. “You could even say it’s going through a renaissance. There are more concession options, and with reclining seats, facilities are more comfortable.”
Over four days in Sin City, theater owners will be treated to a steady diet of clip reels highlighting the previous year’s biggest moneymakers and previews of films to come — every one a blockbuster, if the studios are to be believed. There will also be full-on screenings of “Inside Out,” “Spy” and “Pitch Perfect 2,” as well as appearances from top talent.
The purpose is not so much to sell exhibitors on the pictures, since theaters book films far in advance, but rather to cheerlead for the industry. “There’s so much press about the all of these threats to theaters and the end of the business,” said president of the alternative programming and distribution division at Carmike Cinemas’ Bud Mayo. “It helps to have positive reinforcement.”
But it’s more than a quest for validation. Exhibitors come to CinemaCon to meet with colleagues, and check out a tradeshow boasting the latest developments in popcorn technology and amenities — from 4D seating that jerks and bucks along with the onscreen action to laser demonstrations that promise a crisper picture.
“It’s the place to be seen,” said Brock Bagby, director of programming and business development at B&B Theatres. “You get a lot of face time with a lot of people, and that gives you leads on new theater projects and potential partnerships.”
The hope is that not everything that happens in Vegas stays there.