Cineworld step into the Universal/AMC argument to back their fellow exhibitor

Cineworld step into the Universal/AMC argument to back their fellow exhibitor

The fallout from Universal's intention to release more PVOD titles in a way similar to Trolls World Tour continued today as Cineworld - owners of the Regal chain in the US - released a statement saying they "will not be showing movies that fail to respect the windows."

Last night AMC responded to Universal by saying they would ban all films released by the studio from their chain, with Universal reaffirming their position to state they "expect to release future films directly to theatres, as well as on PVOD when that distribution outlet makes sense."

While the statement (reported by Deadline) does not explicitly say Cineworld are banning Universal films, the strongly-worded nature of the content indicates they sees little value in working with Universal. However, given the financial difficulties Cineworld and AMC (and all exhibitors) are likely to face in the near future, it's hard to see them sticking to such a hard line, given the tentpole titles Universal have coming over the next couple of years.

The National Association of Theater Owners also took aim at Universal last night and released their own statement, saying the financial success of the Trolls sequel was not an indication of changing viewing preferences - a point that is hard to disagree with.

There has been a lot of talk about Trolls being the ideal test model that could change the way non-tentpole blockbusters are released going forward. However, with millions of people stuck at home and looking for content to fill their time, the marketing data is somewhat skewed at present. If Trolls had been released under normal market conditions and achieved the same level of success, it would indicate a change in how people want to watch certain films. But with audiences held 'captive' at home, it would make little sense to use this as a test model. Whether or not a studio will be brave enough to attempt the same in the near future when things return to 'normal' remains to seen.

Below is the full statement released by Cineworld a short while ago:

Cineworld’s policy with respect to the window is clear, well known in the industry and is part of our commercial deal with our movie suppliers. We invest heavily in our cinemas across the globe and this allows the movie studios to provide customers all around the world to watch the movies in the best experience. There is no argument that the big screen is the best way to watch a movie.

Universal unilaterally chose to break our understanding and did so at the height of the Covid-19 crisis when our business is closed, more than 35,000 employees are at home and when we do not yet have a clear date for the reopening of our cinemas.

Universal’s move is completely inappropriate and certainly has nothing to do with good faith business practice, partnership and transparency.

Mooky Greidinger, Cineworld’s CEO approached Brian Roberts, the Chairman of Comcast, back in 19th of March (after Universal announced that Trolls 2 would be released in breach of the window) and told him among other things that:

“Nice words from your team are worthless if we cannot trust you as a partner. The message that the media has portrayed is: “Hollywood breaks the window” – well, this is not true! All our partners called us in timely manner and told us that in the current situation they want to shorten window for movies that were already released as cinemas are closing, most importantly, they all reassured us that there will be no change to their window policy once the cinema business returned. Unfortunately I missed similar message in Universal’s announcement… not only did Universal provide no commitment for the future window – but Universal was the only studio that tried to take advantage of the current crisis and provide a ‘day-and-date’ release of a movie that was not yet released”.

Cineworld’s roots go back 90 years in the industry and it was always open to showing any movie as long as the rules were kept and not changed by one sided moves. Today we make it clear again that we will not be showing movies that fail to respect the windows as it does not make any economic sense for us.

We have full confidence in the industry’s current business model. No one should forget that the theatrical side of this industry generated an all-time record income of $42 billion last year and the movie distributors’ share of this was about $20 billion.

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