Universal Studios simultaneously released “Trolls World Tour” in theaters and for premium video-on-demand (VOD) last April. AMC Theaters retaliated by banning Universal movies from their 11,000+ screens. The banning of a studio by a theater chain had no immediate impact with most theaters closed for the coronavirus pandemic.
That was three months ago.
Orion Pictures announced a simultaneous release of “Bill and Ted Face The Music” to theaters and for premium video-on-demand last week. None of the theater chains cried foul and threaten retaliation like they did for “Trolls World Tour.” AMC and Universal Studios announced earlier this week a deal that could change the way movies are release to theaters and for premium video-on-demand.
An update regarding “Tenet” before I deep dive into the new deal between AMC and Universal. Warner Brothers recently removed “Tenet” from the release schedule without setting a release date. “Tenet” could open in December if “Dune” postponed to summer 2021. The new release dates are internationally on August 26th and in select U.S. cities on September 3rd.
Why the separate release dates?
An international release makes sense as most countries around the world has the pandemic under control to reopen movie theaters. The U.S. release is a bit sketchy with the pandemic spiraling out of control in most states. The top three markets—New York City, Los Angeles, and the San Francisco Bay Area—probably won’t have any theaters reopened in September.
Trolls 2: World Tour
Universal Studios announcing a simultaneous release of “Trolls 2” was the latest shot in a long running battle between theaters and studios.
Theaters had for decades a 90-day exclusivity period on showing new movies. That gave consumers a “choice” between watching a new movie at the theater or waiting for the home release. A choice that maximizes profits for the theaters at the expense of the studios.
The studios want to give consumers a different choice by offering a simultaneous release of a new movie. It doesn’t matter to them if you watch at the theaters or from home. A choice that maximizes profits for the studios at the expense of the theaters.
AMC slapped down Universal hard as a warning to other studios. The theater chains weren’t going to allow a studio to challenge the status quo. Pandemic or no pandemic. Most theaters planned to reopen with social distancing rules and at reduced capacity by mid-summer.
Bill & Ted Face The Music
Orion Pictures made two announcements about “Bill & Ted Face The Music.”
The first announcement was the movie being postpone from August 28th to September 1st. The rescheduling of “Tenet” and “Mulan” has been a constant theme in my theater and drive-in videos. No surprise that “Face The Music” got a new release date.
The second announcement was the simultaneous release to theaters and through video-on demand. A bit surprising considering what happened to “Troll World Tour” and Universal. But the bigger surprise was no reaction by the theater chains. Perhaps the theaters inability to reopen their doors by now reduced their ability to dictate terms to the studios?
And then AMC and Universal announced their deal.
What is the AMC/Universal deal?
What’s the key points of the AMC and Universal deal?
- The exclusivity period for new movies reduced from 90 days to 17 days. Most movies make or lose money in the first two weeks of release.
- Universal will have the option to release new movies to premium video-on-demand. AMC will earn their cut by hosting the video-on-demand on their website.
- Lower cost streaming services will still have to wait 90 days after release. Nothing has changed for Amazon, iTunes, and Netflix in this regard.
The deal applies only to AMC and Universal. Other theater chains and studios could join in to avoid being left behind. Except for Disney. The House of Mouse will do whatever it wants. It’s hard to say who got the better deal between theaters and studios. I doubt consumers will benefit much from this.