Following Universal's success in releasing Trolls World Tour directly on-demand, as well as comments made by NBCUniversal's CEO, AMC Theatres has announced they will no longer show Universal films. Ever since mid-March, the coronavirus pandemic has impacted the entertainment industry in major ways. Among the most notable is the forced shuttering of movie theaters and postponing of a large number of major films. Most delayed films are waiting for theaters to reopen for a proper theatrical release, but some have already broken ranks and moved directly to streaming and on-demand. Universal was the first studio to do this with Trolls World Tour, which has been a success for the studio. Reportedly, Trolls World Tour has so far generated more revenue than the first Trolls.
Because of this, NBCUniversal CEO Jeff Shell announced that in the future, Universal will continue to release films theatrically, but will also be sending films straight to on-demand. The studio has long wished to try the early VOD release format, and now the ongoing pandemic has presented the ideal opportunity to do so. Recently, Universal announced it would be releasing its Judd Apatow/Pete Davidson collaboration The King of Staten Island on VOD instead of pursuing a theatrical release, further indicating the studio's interest in this strategy.
As expected, Universal has received some backlash from theaters, specifically AMC. THR reports that AMC's CEO and President, Adam Aron, sent a blistering letter to Universal Filmed Entertainment Group chairman Donna Langley on Tuesday sharing the chain's decision to stop showing Universal films at their theaters. Per Aron's letter, "It is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us with no choice. Therefore, effectively immediately AMC will no longer play any Universal movies in any of our theaters in the United States, Europe or the Middle East." Aron also revealed the ruling will extend to any studio that opts to forgo theatrical releases. He also promised AMC would be willing to participate in discussions with Universal, but until such an event arises, AMC will stick to its decision.
AMC was not the only organization to speak out against Universal's move, as the National Association of Theater owners issued a statement condemning Universal and insisting that the success of Trolls World Tour can only be attributed to the ongoing pandemic, not a changing mindset for moviegoers. NATO's CEO and President John Fithian said this:
Universal does not have reason to use unusual circumstances in an unprecedented environment as a springboard to bypass true theatrical releases. Theaters provide a beloved immersive, shared experience that cannot be replicated – an experience that many of the VOD viewers of this film would have participated in had the world not been sequestered at home, desperate for something new to watch with their families. We are confident that when theaters reopen, studios will continue to benefit from the global theatrical box office, followed by traditional home release.
AMC's move is a shocking one, especially when considering the films Universal has to offer. Next year, the studio will release both Fast & Furious 9 and Jurassic World: Dominion, both of which are expected to be big box office earners. By refusing to show any Universal films, AMC is essentially missing out on some very big crowds. One the other hand, AMC is one of the theater chains that has been hardest hit by their coronavirus shutdown, even approaching bankruptcy. To hear that a major studio is considering skipping theatrical releases, even for only select films, likely worries theaters who are relying on new releases to earn a profit.
Should Universal change its mind, or come to an agreement with AMC, this could very well change. If there is one thing that is clear, however, it's that the entertainment industry isn't going to be the same once the pandemic ends. Now that studios are more interested in streaming than ever, theaters should expect quite the shake-up, though they likely won't ever be without movies to show.
Source: THR, NATO