CinemaCon Big Takeaways: Diversity, Disney and the Threat of Netflix

The Lion King Teaser
Disney/YouTube Screenshot

CinemaCon, the annual love fest between studios and exhibitors, wrapped up Thursday after a week that was largely spent pontificating about the power of cinema and the potential of upcoming blockbusters such as “The Lion King” and “It: Chapter Two.” The Las Vegas event is mostly an opportunity to cheerlead for a business that is often dismissed as fading and out-of-touch, and for once there was plenty to be happy about. The domestic box office hit a record in 2018 and many analysts predict that this year will reach another milestone.

But there are also real threats that the industry must grapple with, from aging audiences to a rising generation that prefers their smartphones to the big screen. Here are six takeaways from CinemaCon 2019:

Disney-Fox Merger Is Too Big to Fail

Even Disney seems amazed by just how big it has become following its $71.3 billion purchase of much of 21st Century Fox’s film and television assets. “I’m still getting my mind around all this and internalizing it,” Disney film chief Alan Horn told exhibitors during the studio’s presentation this week. There’s certainly a lot of firepower at Horn and company’s disposal. There were audible gasps in the room of theater owners when the studio flashed a graphic that displayed its entire slate post-merger. Now that labels like 20th Century Fox, Blue Sky and Fox Searchlight are joining the ranks of Pixar, Lucasfilm and Marvel, Disney’s chokehold over the marketplace only stands to grow stronger. The studio will now control nearly half of the domestic box office and will have a majority of the top-grossing film franchises in the world — the Magic Kingdom will encompass everything from “Star Wars” to “Avatar.” That leaves Disney’s rivals punching up and it means that everyone else will be dwarfed by the sheer power of what the studio can offer. The good news for exhibitors is that these films and their sequels and spinoffs will keep their theaters full for years to come. The bad news is that Disney will be able to extract an ever richer cut of the box office if it should desire. It’s good to be the king.

Everyone’s Scared About Streaming

Nobody wanted to acknowledge the elephant in the room. So leave it to the blunt spoken Helen Mirren to drop a well-placed bit of profanity… “I love Netflix, but f— Netflix,” the acting legend said while on-stage teasing her upcoming film “The Good Liar.” The roars that greeted Mirren’s comment demonstrated just how much theater owners resent the ways that Netflix is disrupting the media landscape.

The streaming giant was a hot topic as studios and exhibitors spent four days in Vegas rhapsodizing about the magic of the big screen. If we had a dollar for every time they mused about the power of being in a darkened theater basking in the collective joy of laughing, crying, being terrified by a movie, well we could probably have bought Fox. The anxiety is palpable. At the close of an annual press conference with the National Association of Theater Owners and the MPAA, John Fithian of NATO scolded press for their interest in streaming, disappointed that the record box office was not bigger point of discussion in a room that included MPAA chief Charlie Rivkin.

You get the sense that theater owners needed to puff themselves up. They need to believe that what they’re offering customers is so unique and so compelling that they will be able to withstand all the change that’s roiling their industry. And while the box office was up in 2018, they’re staring ahead towards an uncertain future. Netflix keeps growing, studios are gearing up to press theaters to let them release their movies on home entertainment platforms earlier, and media companies are investing more of their resources in building their own streaming services. With Disney, Apple and WarnerMedia launching direct-to-consumer offerings in the coming months, and Comcast set to debut its platform in 2020, it’s safe to say this debate will continue to heat up. Even Dame Helen would have to admit that.

Saudi Arabia Is a Sensitive Subject

In 2018, Saudi Arabia was seen as the next big opportunity for a movie business on the prowl for growth opportunities. After lifting a 35-year ban on cinemas, the first new movie theater had opened in Riyadh and there were predictions that the Kingdom could become a billion-dollar film market in a relatively short time. Saudi Arabia, under crown prince Mohammed bin Salman, wanted to invest in the film and media business (the Saudi sovereign wealth fund is an investor in Penske Media Corp., the parent company of Variety) and it also hoped to attract studios to shoot films in its country, luring them with generous subsidies.

That relationship between Saudi Arabia and Hollywood was threatened in October when journalist Jamal Khashoggi was murdered by agents of the Saudi government. The CIA later concluded that Bin Salman had ordered his assassination. Against this backdrop, talk of Saudi Arabia was more muted at this year’s CinemaCon. AMC chief Adam Aron said the company had been shaken by Khashoggi’s murder, but ultimately decided to move forward with plans to build as many as 40 theaters in the country.

“It caused us to think and think hard about what was the right thing to do,” Aron told Variety. “And after a lot of thought we concluded that we’re there in that country for the benefit of the people. There are 33 million people in that country, 70% of whom are under the age of 30 and they like movies.”

And AMC isn’t alone. Three other chains are trying to get the approval to open theaters in Saudi Arabia, Fithian said at his press conference, and the Saudi government announced it planned to invest $35 billion in theaters by 2020. Like Aron, Fithian pointed to the liberalizing power of art.

“Movies have been a sword of freedom for a very long time,” he told press. That may be true, but the shocking death of Khashoggi has left some companies wary of getting involved with the Middle Eastern country.

Sony Sits It Out

Sony was sorely missed in Sin City. It’s no small fee to dazzle theater owners at CinemaCon, and studios can shell out as much as $4 million to make the trek to the desert. Still, the Culver City studio has one of its most anticipated slates in years with Quentin Tarantino’s “Once Upon a Time in Hollywood,” “Spider-Man: Far From Home,” the “Jumanji” sequel, and “Men in Black: International” all scheduled to hit theaters in 2019. With that kind of stacked lineup, shouldn’t Sony have sprung for the cost of a few private jets for some of its stars and some blowout dinners at Nobu? This might not have been the time to tighten the old belt.

Felines Are So Hot Right Now

With Disney’s remake of “The Lion King” and Universal’s big-screen adaptation of Andrew Lloyd Webber’s musical “Cats” on deck for 2019, our furry friends are finally ready for their closeup. Cats also may play prominent roles in this summer’s “Secret Life of Pets 2,” although that gem focuses more on their hated rival, dogs.

In fact, cats are so hot right now, at least ones of the CGI variety, that moviemakers have apparently had to come up with something called “digital fur technology.” Universal didn’t share any footage from “Cats,” citing the complicated post-production work required to turn stars such as Idris Elba and Taylor Swift into convincing Jellicles, but “The Lion King” is a wonder. Simba, Mufasa and the rest of the pride look like they just stepped off the savannah. Oscar winners and A-listers are expending a lot of effort getting connected with their inner tabbies.

“We spent a very, very long time observing cats or learning how to be a cat,” said Judi Dench in the behind-the-scenes look at “Cats.”

Inclusion, Inclusion, Inclusion

“Black Panther,” “Wonder Woman,” “Us,” “Captain Marvel,” and “Crazy Rich Asians” proved that audiences want to see themselves represented on screen. Making movies that feature people of color and women in the lead role isn’t just a moral good, it’s good for business. And after largely ignoring the non-white man demographic for the past century, Hollywood has finally gotten the message. On stage, NATO’s Fithian, Warner Bros. chief Toby Emmerich, and Universal head Donna Langley leaned into the power of inclusion, pledging to back more projects with diverse casts. From studio blockbusters such as “Wonder Woman 1984” to crime dramas such as “Queen & Slim,” a movie business that was largely monochromatic and male is beginning to reflect an audience and a country that has become ever more diverse.