×
You will be redirected back to your article in seconds

Future of Imax VR Uncertain After Company Closes Two Centers

Virtual reality was supposed to be Imax’s next big thing. Now, the company is questioning its commitment to the new medium.

Los Angeles, New York, Shanghai, Toronto: When Imax opened up virtual reality centers in a handful of cities around the world last year, the company painted it as a first step toward a possible massive global initiative. The iconic brand was looking for a chance to expand beyond cinemas and become a major player in the nascent market for location-based VR.

One year later, the future of Imax VR looks a lot less certain. The company closed one of its two VR centers in New York at the end of June, and shut down its VR center in Shanghai in early July.

Imax CEO Richard Gelfond first opened up about the company’s struggles to make VR work during the company’s Q1 2018 earnings call. “The consumer reaction was extremely positive, but the numbers just weren’t there,” he said. Gelfond said only one of the seven centers open at the time was meeting the company’s financial expectations.

Imax CFO Patrick S. McClymont even suggested that the company may pull the plug on the remaining five centers, telling investors during the company’s Q2 earnings call: “Regarding our VR and home theater ventures, in order to continue to focus on reducing costs from new business, we expect to reach a decision on these initiatives during the next few months.”

“As we’ve said since launch, this is a pilot program for us to test whether VR centers in multiplexes is a viable business that could be launched worldwide,” a spokesperson added via email. “We’re still in the review process.”

It’s true: Imax did bill Imax VR as a pilot program from the very beginning. “We want this to be a true experiment,” said the company’s chief business development officer Rob Lister when the company opened its first center in Los Angeles in January of last year.

The plan, as outlined by Lister, was to open five to 10 such locations to gauge the interest in VR — and then possibly commit to a much bigger roll-out that could ultimately mirror the company’s engagement in the theater space, where it operates more than 1,000 locations. Last summer, Lister still said that Imax VR was “off to a promising start.”

So what went wrong in the following months? Market insiders told Variety that Imax struggled to get its hands on enough titles with name recognition to attract sizeable crowds. In the theater space, the company is known for showing blockbusters. Just last week, Imax announced that it would bring all of Marvel’s movies to its theaters to celebrate the studio’s 10th anniversary. Other titles coming soon to Imax theaters include “Fantastic Beasts: The Crimes of Grindelwald,” “The Nun,” and “Venom.”

In the VR space, there aren’t simply as many blockbusters that would appeal to a wider audience beyond hardcore gamers. The company anticipated some of that, which is why it set up a $50 million fund with participation from CAA, China Media Capital, and the Raine Group to co-produce VR experiences.

However, up until now, Imax has only invested $4 million into VR content production, which has resulted in the launch of just a single title: “Justice League, An Imax VR Exclusive,” debuted in Imax VR centers in November. The company’s exclusive window for the title lasted merely two weeks. After that, it was made available to consumer VR headsets, where it has received mixed reviews.

This points to another problem: Imax VR was built around the idea of bringing VR to audiences that don’t own headsets yet. Virtually all of the games and experiences you can use at Imax VR centers are also in one form or another available to the in-home VR market. Imax has tried to customize some of these experiences with special motion chairs as well as better VR headsets, but these differences may not necessarily warrant paying $10 or more for 10 minutes of fun.

Imax has experimented with selling bundles to multiple experiences, and even introduced a day pass for one of its centers earlier this year. However, an industry insider told Variety that the big studios are resistant to such pricing models, which forced the company to exclude at least one title from the promotion.

There are also some doubts as to whether the combination of VR and traditional theaters will actually work. The theory behind Imax VR, and similar efforts by other companies, was that VR headsets could help lure younger audiences back into theaters, effectively working as a promotional vehicle for the big screen.

At least in one instance, a theater had to resolve to flipping that model altogether: The Odeon Cinema in Manchester, which hosts Imax’s first European VR center, has been giving theatergoers vouchers for free VR experiences with every movie ticket this summer.

Correction: 2:40pm: A previous version of this post stated that Imax closed a VR center in Singapore, whereas it actually closed its Shanghai location.

More Digital

  • Jorge-Franco-and-Adrian-Suar

    Pol-ka Expands Outside Argentina, Optioning ‘El Cielo a Tiros’ (EXCLUSIVE)

    PAMPLONA, Spain  —  Taking a new expansive step as an international content player, top Argentine production house Pol-ka, has optioned small-screen rights to “El cielo a tiros,” the latest novel from “Rosario Tijeras” author, Colombian novelist Jorge Franco. Pacted via Scenic Rights, the deal sees Pol-ka planning to shoot a drama series based on the [...]

  • Tencent Music presentation at Shanghai

    Shanghai: Tencent Proposes Alliance of Music and Film

    All tech companies strive to be ubiquitous. Within China, behemoth Tencent is a clear leader of the pack. From the company’s “pan entertainment strategy” in 2012 to its 2018 equivalent “neo-creativity strategy,” Tencent keeps unveiling new master plans, each time with more in-house platforms and business approaches involved. On the margins of the Shanghai International [...]

  • Genius Spars With Google Over Lyric

    Genius Accuses Google of Scraping Song Lyrics, Music Data Company Hits Back

    Lyrics annotation service Genius.com has accused Google of scraping its site and stealing its content, the Wall Street Journal reported this weekend. However, a lyrics data provider at the center of the controversy claimed on Monday that those allegations were without merit. The Journal reported that Genius had been complaining to Google about the alleged [...]

  • littlstar ps4 app

    Littlstar Expands Beyond VR With New PS4 App, Signs Up 30,000 Paying Subscribers (EXCLUSIVE)

    A&E-backed immersive content aggregator Littlstar is expanding beyond virtual reality (VR): The New York-based startup launched a dedicated PlayStation4 app this week, giving users of Sony’s game console access to their personal media libraries, as well as both traditional and 360-degree video content from a variety of publishers. Littlstar also announced that it signed up [...]

  • Game of Thrones Season 8 Production

    'Game of Thrones,' Netflix VFX Among Those to Be Featured in SIGGRAPH Production Talks

    VFX pros behind the final season of “Game of Thrones,” the blockbuster film “Avengers: Endgame,” Pixar’s upcoming “Toy Story 4,” last year’s Oscar-winning “Spider-Man: Into the Spider-Verse,” Netflix series, including “Stranger Things,” and more will give SIGGRAPH 2019 attendees a behind-the-scenes look at their work during the conference’s Production Sessions. There will even be a [...]

  • Patrick Drahi

    Altice's Patrick Drahi to Acquire Sotheby's Auction House for $3.7 Billion

    Patrick Drahi, the owner of the telecom group Altice, is on track to purchase Sotheby’s, the high-profile auction house, for $3.7 billion. The acquisition would turn Sotheby’s into a privately owned concern after 31 years as a publicly listed company on the New York Stock Exchange. Drahi said the acquisition had “no capital link with Altice [...]

  • Soundgarden’s Immersive 'Artists Den' Experience Premieres

    Soundgarden’s Immersive 'Artists Den' Experience Premieres This Week (Exclusive Preview)

    There’s no question that the posthumous release is the most difficult to get right: Human beings are unpredictable, and trying to guess what a person’s intentions might have been is an uphill (if not a losing) battle. Yet posthumous releases ranging from Michael Jackson’s “This Is It” to recent Prince and Jimi Hendrix collections prove [...]

More From Our Brands

Access exclusive content