Feb 24, 2021
That’s the big news in cinema land this week – Cuomo is allowing movie theaters in NYC to open at 25% capacity or 50 people max, as we hit the 500K mark in covid-related deaths in the US. Ok, let's admit it - if you were writing the script for the re-opening movie here, you wouldn't have this announcement come out at the same time as the 500K milestone. I mean, heck, by Sunday, Trump will have had his news conference and we'd be in a new news cycle. They couldn't wait a week? Sure, case counts are going down, vaccines are rolling out (especially to the elderly audiences that attends theaters the most), and as I said last week, we’re beginning to see some light up ahead, but is this too much, too soon?
Truth is, I don’t know, and neither does Cuomo because neither keeping them shut or opening them was based on the science at either time. As of now, NYC is doing worse than many times when Cuomo decided it was too early to open, and there is a big risk of opening up too widely, especially when he’s also rushing to allow weddings, restaurants, group shouting matches, and this little thing called schools. Not to mention, we have some variants on the loose. Here's a graph from the NYT showing how many more deaths we'll get from opening up too soon (approximately what we're doing in NYC):
vs. How we'd look if we take things slowly:
That's 220K less deaths. About half as many as we've had so far, in less time. Seems pretty clear to me.
Most theater owners see pretty giddy about the whole opening-up thing, and I can’t begrudge them for wanting to figure out a way to survive. But as I’ve also said before – the solution here isn’t to just open them up, but to actually give them some financial support, so they could wait this out, but this being 'Merica, that's not happening.
My hunch is that we won’t see many films drawing anywhere near that cap anytime soon. As CNN reports, many movie-goers are saying they’ll wait for vaccines to be more widely available, and many distributors and studios seem to be waiting for the same – and for LA to open up as well, according to Variety. As theaters have opened across the US, the numbers have been pretty slim, so much so that many distributors are starting to conceal their box office numbers. We’ve got proof from China that audiences will show up once they feel safe, but that’s still not the case for many audiences around the world, and definitely not here in garbage-land the US.
Most arthouse audiences have a surfeit of brain-cells, and will show an abundance of caution and stay home until we see greater vaccination rates and something approaching herd immunity. Again, it’s not the theaters themselves anyone is worried about, but their fellow humans, and the prevalence of masks becoming chinstraps in America. So, my prediction remains the same – we’ll see more drive-ins, outdoor screenings, hybrid festivals and PVOD through at least October, and we won’t likely see much of anything approaching normalcy before the end of the year.
Meanwhile, the other shoe is starting to drop. Cinemark announced plans to shutter three major cinemas – all older theaters, but a sure sign that we’ll see a major consolidation in the sector, as theater owners reduce their footprints. This won’t just be because of Covid, but also because of the broader shift to digital that it catalyzed. I’ll bet you now that we’ll see the bankruptcies and mergers of at least three of the major indie exhibition chains (I’m looking at you, Laemmle, Alamo, Studio Movie Grill, Landmark and similar), the closure of many independents, and a reduction of at least 20% in the number of screens at the majors. This will lead to quite a domino effect in the distribution landscape, who will lose screens, and will continue to be hit this year as the major SVOD platforms stop making deals for completed films, drop even more output deals, and as platforms like Amazon Prime have moved to close outlets for many docs and indies. AVOD can’t support all of these aggregators, either.
I take no pleasure in forecasting any of this – and am not taking much risk in my predictions – as these are easy bets, based on the evidence. Believe me, you, I’d love to be sitting in a theater by this Summer, but I don’t see that happening. And if we can’t count on audiences in theaters… and virtual cinema receipts are “like roses on a casket,” as one distributor told me… and if everyone else is watching the Netflix’s of the world…but those platforms don’t want our arthouse films so much…and we can’t sell them via Amazon Prime, either…and if AVOD is the only consistent revenue source, but it only works for certain niche titles, as another distributor told me this week…and, well, this list could go on, but you get my point. One starts to wonder how we remake this whole sector into something resembling a business once again? Or at least the appearance of one? And in the meantime, if theaters can't survive at 25% either, and few will show up, does it make any sense to open up cinemas this early, just because we can?
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Film
The New(-ish) Disney CEO Loves Direct to Video - That's the big takeaway from the WSJ's in-depth analysis of Bob Chapek's tenure pre-ceo level at Disney. In one of the best articles I've read about Chapek, the WSJ looks back at his career, and it turns out, he was very involved with multiple aspects of Disney's past that means lot for its future - direct to consumer (and prioritization of them); direct to video, back when that meant straight to VHS or DVD; and caring a lot about the marketing of films like "Air Bud." He's not likely gonna get in the way of creative decisions, but he will make sure that at home consumers come first - as he says at the end of the article - Disney is " in the home-entertainment business and they don’t know it yet." Full article (paywall)
Film Exhibition ClubHouse - Karin Chien and her Distribution Advocates Team have arranged a new ClubHouse chat this coming weekend, focused on new thinking in film exhibition. As she explains in the Dear Producer newsletter: "It’s time for robust conversations about modes of exhibition that indie films can sustain. What are new and different structures of exhibition where our films and different audiences can thrive together? There is so much we can be talking about, beyond “when will we go back to theaters?” Per my letter above, this is something I'm thinking about a lot, but I won't be able to join this convo as I don't do work Clubhouses (or much else) on the weekend, but if you do - this is one I'd recommend joining. And if you need a Clubhouse invite, hit me up.
Distributor's Fact Sheet 2021: Speaking of Dear Producer, Liz Manashil and Dear Producer have published their 2021 Distributor's Fact Sheet. The report gives a breakdown of what 38 distributors (41 declined to participate) are doing in the distribution landscape. It covers everything from where they look for films, to what they think is ahead for '21. Definitely worth a read.
Speaking of Distribution.... Check out the Road To Recoupment panel, also this weekend. Showbizing and Film Launch are hosting a panel on distribution and the road to recoupment, and one of the speakers is Liz Manashil from the aforementioned report. A busy weekend for talks about distribution and exhibition; I am almost sad to be missing all of this. Seriously though, another great set of speakers that you might want to check out.
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Branded Content
 Influencers Have to Declare Ads - Why Not Everyone Else? Great new video from Tom Scott on the history of branding and product placement in entertainment and the rules around this - from the BBC banning songs that mentioned any products (like the Kinks changing Coca-Cola in Lola to Cherry Cola to satisfy BBC rules) to the FCC and FTC allowing pretty much anything - and consumers left to wonder what's an advert and what's not (a running joke in the video) - apparently because the regulators here think it's transparent. It's a fun video to watch while thinking of shows like Ted Lasso on Apple TV+, which is basically a really fun Apple commercial. His basic argument is that more countries should take the approach that corporate speech deserves a bit more regulation, and more consistency across mediums. I'd agree, if only to tamp down on the firehose of garbage product placement (and the move to smarter branded content).
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Miscellany:
Truth in Photography: Love this new project - (from the website): "Truth in Photography is an open-ended online forum for active dialogue and discussion about photography and social change, exploring issues vital to truth in image-making that are crucial to our understanding of the world today. This interactive project questions the singular truth of photography by presenting multiple points of view, featuring a diversity of curators, photographers, critics, and historians, integrating vernacular photography, photojournalism, and fine art photography. Truth in Photography interrogates the nature and intentions of the medium and examines the relationship between the photographers and their subjects. Truth in Photography is produced by Documentary Arts in collaboration with Magnum Photos, Aperture Foundation, International Center of Photography, Local Learning, and Family Pictures USA." I recommend checking out Clarence Elie Rivera's Legal Aliens piece this month.
The Australian FB and Google News-payments Saga Continues - The NYT probably has the best run-down of what's going on, the WSJ explains how this is gonna spread to other countries, and Mike Masnick of TechDirt has the best counter-arguments to the prevalent narrative that FB is somehow evil here. I have to admit - it's a bit hard to have sympathy for the publishers here, when the law is basically making sure Rupert Murdoch gets paid, and while even his paper's reported an increase in traffic when FB stopped linking to them...
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