Alejandro Ramírez Magaña, CEO of Cinépolis, described Screening Room as the latest in a long line of failed distribution experiments, and implied that it threatened the health of the movie business. More can be done by having distributors and theater owners collaborate on new initiatives to grow revenues, Magaña said during a presentation at CinemaCon, the exhibition industry trade show taking place this week in Las Vegas.
“We think that instead of experimenting on how to shorten the theatrical window we should work together to strengthen it,” Magaña said to a smattering of applause from a crowd of theater owners.
“We want each window to stay on its own,” he added. “We need to protect this window that has been so important and so dear to all of us.”
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Magaña said experiments such as Screening Room could lead to “billions of dollars in lost revenue.” He noted that other initiatives, such as an aborted 2011 plan by Universal to distribute “Tower Heist” on-demand early, were unsuccessful. His remarks came at the opening day of CinemaCon during an event that highlighted the growing significance of the foreign box office.
Representatives of Screening Room, including co-founder and CEO Prem Akkaraju, will be in Vegas this week showing their technology to theater owners. Supporters — a group that includes Steven Spielberg, Martin Scorsese and Peter Jackson — believe that the service will grow revenues by enabling audiences with kids or other demands on their time to watch movies in the home. As part of the plan, studios and exhibitors will receive a significant percentage of the $50 fee that Screening Room charges for each movie. The technology includes an anti-piracy element.
Headquartered in Mexico, Cinepolis is the fourth largest movie theater chain in the world, with more than 3,000 screens in over 10 countries.
In addition to Magaña, exhibitors heard from Thomas Molter, EVP of international distribution at Warner Bros. The studio executive noted that while attendance grew in most countries in 2015, a stronger U.S. dollar is depressing box office receipts for major studio releases. Currency devaluation caused foreign receipts for “San Andreas” to fall 16% and took a 20% bite out of “Mad Max: Fury Road’s” overseas returns. It also meant that “Batman v Superman: Dawn of Justice’s” $256 million foreign launch would have been 5% higher if the film had hit theaters a year earlier. At the same time, admissions in most foreign countries have continued to rise, showing that the popularity of film-going has not waned.
“Shifting economic tides are clearly one of major challenges we face as a global studio,” said Molter.
Hollywood is also having to deal with younger ticket buyers’ greater interest in accessing movies on smartphones and connected devices.
“Millennials in the U.S. prefer to watch content on smaller screens,” said Molter.
He noted that 14% of millennials like watching content on their iPhones compared to 7% of Generation Xers and 3% of Baby Boomers. Moreover 26% of millennials like watching shows and films on a computer, while 14% of Generation Xers use computers to watch content and 11% of Baby Boomers.
“We cannot be complacent and assume that these moviegoers will continue to come,” said Molter.
Finding fresh ways to keep the movie-going experience relevant and exciting, Molter argued, will come from strengthening ties between studios and exhibitors.
“I think that now more than ever we have an unprecedented opportunity to join forces and navigate this transition together,” said Molter.