Category Archives: Distributors

Though Major Exhibitors Still Boycott Simultaneous VOD Releases From Netflix, the Oscars Willingly Accept Them

Beasts of No Nation

Idris Elba in “Beasts of No Nation”

On Monday of last week, Deadline broke the news that Netflix was making another move into feature films by acquiring “Beasts Of No Nation” for a reported USD $12 million. This was followed the trade publication Variety which published three stories on the same subject in quick succession, the headlines for which could have been written before the news they detailed had actually occurred or been made public.

The first headline read, “Netflix Makes Another Bigscreen Splash With ‘Beasts of No Nation’” and laid out the information presented by Deadline less than an hour earlier, while adding their own take about how the acquisition was meant to “bolster its awards season status” (more on that in a moment).

The second and third headlines on the subject could have been predicted by anyone following the film industry over the last few years and came within 24 hours. By Tuesday morning Variety told us “Netflix Releasing ‘Beasts of No Nation’ Simultaneously in Theaters and Streaming Service” and by that afternoon was able to inform us “Major Theater Chains to Boycott Netflix’s ‘Beasts of No Nation’“.

Identical headlines are likely to appear every time Netflix purchases another feature length film it plans to distribute. The title of the movie is all that need be altered. We had seen similar headlines in the same sequential order last October when Netflix announced their intention to distribute the sequel to the martial arts classic “Crouching Tiger, Hidden Dragon” this August day-and-date in cinemas and through its subscription video-on-demand streaming service.

This latest Netflix pickup is from the much-in-demand director Cary Fukunaga fresh off an Emmy win for his work on the first season of HBO’s “True Detective”. Based on Uzodinma Iweala’s critically acclaimed debut novel of the same name, its story centers around a boy forced to become a child soldier in an unnamed African country. The film stars Idres Elba as a guerrilla leader who turns the boy into his protégé through a dehumanizing process meant to train him as a soldier.

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Amazon Enters Movie Business With Two Wise First Steps

Ted Hope

Ted Hope was hired as Head of Production for Amazon Original Movies

In a twist of the old adage “give them an inch and they’ll take a mile”, just a week after winning a Golden Globe for television series, musical or comedy for their show “Transparent”, web giant Amazon has announced its intentions to enter the movie business by producing theatrical releases. To show just how serious they are about the new venture, the company has hired indie film veteran Ted Hope as Head of Production for Amazon Original Movies.

Amazon already produces television shows for subscribers of its Amazon Prime program. Now in a strategy that mirrors Netflix, its streaming rival, Amazon is aiming to release roughly 12 movies per year in cinemas starting in late 2015. In a window shrinking move, Amazon will premiere each title on Amazon Prime Instant Video (at least in the United States) only four to eight weeks after their theatrical release.

The tight release window may sound like a deal breaker for theatre owners, and probably is for certain exhibitors, but keep in mind the type of films Amazon intends to distribute. “The movies in this program will be ‘indie’ movies,” Amazon Studios Vice President Roy Price told media outlets in an email. “We will be looking for visionary creators who want to make original, unforgettable movies. We expect budgets to be between $5 million and $25 million.”

As Price hinted at in Amazon’s press release announcing the news, independent films have increasingly been experimenting with day-and-date releases in various forms in hopes of augmenting even the most modest of theatrical releases:

“Not only will we bring Prime Instant Video customers exciting, unique, and exclusive films soon after a movie’s theatrical run, but we hope this program will also benefit filmmakers, who too often struggle to mount fresh and daring stories that deserve an audience.”

It doesn’t take an industry expert to read between the lines and understand Price is saying if it wasn’t for Amazon coming along, some of these movies might not even get made, let alone wind up in theatres. If indie films is their goal, then the company has certainly picked the right guy to head up the effort.

Hope is a well-known, highly experienced and savvy producer with deep ties to the independent film world. If his name sounds familiar, it should. He’s produced dozens of well known movies, many of them through Good Machine, which he co-founded and ran with screenwriter and the former head of Focus Features, James Schamus. During his tenure as a producer he’s made multiple films with Edward Burns, Hal Hartley, Todd Solondz and Ang Lee, as well as “21 Grams” with Alejandro González Iñárritu. More recently he spent a year running the San Francisco Film Society and until earlier this month was the head of Fandor, an online subscription streaming service that specializes in indie movies.

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Sony Hackers Crossed A Line By Threatening Movie Theatres

The Interview Premiere

Though most of the entertainment industry and business world has been riveted to every breaking development of the Sony Pictures hack, we have purposely refrained from writing anything about it. That was until the perpetrators of the cybercrime threatened movie theatres showing an upcoming Sony film release with terrorist acts.

Yesterday morning, in what has become an almost daily ritual since news of the Sony hack first surfaced the group taking responsibility for the cyber attack, who call themselves the Guardians of Peace, sent an email which threatened:

“We will clearly show it to you at the very time and places “The Interview” be shown, including the premiere, how bitter fate those who seek fun in terror should be doomed to.”

The email went on to state that “The world will be full of fear” and referenced the 9/11 terrorist attacks in New York and Washington D.C. It suggested, in no uncertain terms, that moviegoers should stay away from movie theatres screening “The Interview” and those that live near such cinemas should evacuate their homes. No specific reason was given, however since the hack against Sony Pictures first occurred it has been widely speculated that North Korea might be responsible for the attack in retaliation for “The Interview”, a film Sony had scheduled to open Christmas day. The comedy featuring Seth Rogen and James Franco centers around a plan to assassinate North Korean leader Kim Jong-un.

As a media outlet focused on the motion picture exhibition and distribution industries we were among those who received the hacker’s daily emails. Over the past few weeks we could have used this site to dissect the notes of countless DCI meetings from the past ten years or even highlight the terms of Sony’s various virtual print fee (VPF) agreements, details of which were contained in the staggered distribution of Sony’s data. However, there is a reason such information was meant to be kept confidential and its publication serves no greater public need. As well, the commercial matters being discussed within such documents is ancient history and any interest in them would be purely academic at best. That our silence came with the advantage of not publicizing the hackers or their crime was an added bonus.

But when the perpetrators took aim at the general public, threatening innocent people in a venue this particular media outlet considers a place of secular worship, they crossed a line that even the most malicious hackers know to avoid. Virtual thievery in the anonymity of cyberspace gives victims the false sense they are not in direct danger of physical harm. Threatening terrorist acts upon specific people or places in a world still smarting from an endless string of such events panics a public with feelings of immediate personal danger. That’s what makes such threats so affective and why the Sony hackers’ intimidation of movie theatres is far more damaging than any of the data they leaked.

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Why We’ll Miss Nikki Rocco When She Retires As Universal’s Head of Distribution

Nikki Rocco

Nikki Rocco, President, of Domestic Distribution, Universal Pictures

Arriving at McCarran International Airport in Las Vegas for my return flight from CinemaCon last month I was greeted at the gate by a potpourri of industry professionals, as was to be expected. There were engineers and sales reps from manufactures such as QSC and Volfoni, studio distribution executives from the likes of Twentieth Century Fox and film buyers from exhibition chains both large and small.

Among this assemblage was Nikki Rocco, the president of domestic distribution at Universal Pictures, who at the time was using an iPad to work on something I could only assume must be very important. Earlier today Universal announced Rocco will retire at the end of 2014 after spending 47 years with the company, the last 18 as the first woman ever to head up distribution at a major studio.

Just three days before I watched Rocco walk CinemaCon attendees through Universal’s summer slate during the studio’s annual presentation of its upcoming releases. As I listened to Rocco skillfully introduce titles such as the raunchy comedy, “Neighbors”, Seth MacFarlane‘s “A Million Ways to Die in the West” and the James Brown biopic “Get On Up”, I was once again reminded just how talented and special she is as a person and an executive.

If spending nearly five decades at a single company wasn’t evidence enough to demonstrate just how special Rocco is, consider for a moment that the company at which she has spent her entire professional career is a movie studio. How many studio executives in senior management roles make it past the decade mark at just one company? Not very many. Especially ones that joined their studios as paid interns in 1967.

On top of that, Rocco has been able to survive as the head of distribution during several ownership and leadership changes at Universal. Seagrams purchased the studio the year before Rocco was named the head of distribution in 1996. This was after five trying years under the ownership of Matsushita Electric. In 2000 Universal was sold to Vivendi, a french water utility, transforming into Vivendi Universal. By 2004 Universal was sold again, this time to GE, which already owned NBC, the broadcast television network, thus creating NBCUniversal. Cable operator Comcast then bought a controlling share of NBCUniversal in 2011 and acquired the company outright in 2013.

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Disney To Release Sing-Along Version of “Frozen” In Theatres

YouTube Preview Image

Walt Disney Studios may have struck upon an inventive way to squeeze more revenue from moviegoers who have already seen their latest animated feature, “Frozen”. Hoping to get fans of “Frozen” back into theatres for some repeat business, Disney is releasing a sing-along version of the film on 2,000 screens in North America on January 31st.

Select showings of “Frozen” will include a snowflake that bounces across on-screen lyrics, encouraging audiences to belt out some of the movie’s many songs. Disney’s latest animated film has already grossed USD $773 million dollars globally, and the “Frozen” soundtrack has occupied the number one spot on the Billboard 200 chart for three nonconsecutive weeks in January.

The sing-along concept seems like a natural extension of the “Frozen” release strategy. The music and songs for the film were written by Kristen Anderson-Lopez and Bobby Lopez, the husband and wife team behind such Broadway hits as “Avenue Q” and “The Book of Mormon”. The pair just earned a Best Original Song Oscar nomination for “Let It Go” one of the songs that appears in “Frozen”. Tunes from the movie have proven so popular that fans have flooded the Internet with videos featuring cover versions.

Every studio hopes for repeat viewings of their blockbuster films, however these days most movies don’t stick around as long as “Frozen” has to offer up such opportunities. I remember working as an intern in the public department of Twentieth Century Fox when “Home Alone” was released in 1990. It was a surprise hit and topped the box office for 12 straight weeks thanks to children who saw the movie multiple times. In the midst of its run Fox eve produced a television spot which featured moviegoers bragging about how many times they’d seen “Home Alone”.

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Paramount Reportedly Stops Delivery of Film Prints

35mm Film Platter

Well, it may finally have happened. Everyone working in any capacity of the motion picture industry knew the day would come when Hollywood studios would stop distributing their releases on 35-millimeter film prints. If Saturday’s story in the Los Angeles Times is to be believed, that day may finally have come.

More precisely, it came and went. According to the Times, who relied on anonymous sources identified as “theater industry executives”, Paramount Picture’s Oscar-nominated release “The Wolf of Wall Street” was distributed in North America solely in digital format, i.e. without the use of 35mm film prints.

That should finally answer the longstanding question which arises at every industry standards meeting or trade conference; Has any studio released a title in digital-only and, if not, what will be the first title for which no 35mm prints are distributed? That the answer should be “Wolf of Wall Street” is an irony likely not to be overlooked by many.

The movie is helmed by Martin Scorsese, a director who has been a longstanding advocate for the preservation of film. Arguably a poster child for film historians, Scorsese is often credited with having an encyclopedic knowledge of the medium. His 2011 film, “Hugo”, was an ode to F. W. Murnau and the early days of cinema.

Paramount’s move toward all-digital wide releases seems to have only affected the distribution of titles in the North American market. According to the Times, the studio will still be sending out film prints in international territories such as Europe and Latin America, where the conversion rates for digital cinema are not as high.

The National Association of Theatre Owners (NATO) estimates that over 90% of the 40,000+ screens in the United States have converted to digital. This is especially true of the big exhibition chains which were able to finance large scale, expensive digital cinema deployments over the last five to ten years.

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Universal Cancels “Tower Heist” Premium-VOD Test

Tower Heist Cast

Ben Stiller and Eddie Murphy Star In "Tower Heist"

Well that didn’t take long. Facing stiff opposition from exhibitors Universal Pictures has decided to scrap its plan of releasing “Tower Heist” on premium-video-on-demand three weeks after its November 4th release. The move comes a week after the studio originally announced its intentions to run a PVOD test in Atlanta and Portland which would make the film available to about 500,000 cable subscribers for USD$59.99.

No doubt the number of exhibitors willing to boycott the film outright had a great deal to do with the decision. Previously Cinemark, Emagine Theatres, Galaxy Theatres, Regency Theatres and an additional 50 screens owned by independent operators all publicly stated they would not be booking the film if Universal went ahead with the premium-VOD test. Then today National Amusements joined the list of exhibitors opting not to show “Tower Heist”. With 950 screens worldwide, National Amusements is one of the largest chains in the United. States. Bloomberg reported that of the 39,000 screens in the U.S., 12% were participating in the boycott.

If that figure directly corresponds to the drop in box office Universal could expect for “Tower Heist” then that’s significant. Given that it is predicted the film will make upwards of a USD $100 million or more, that could mean foregoing USD $12 million in receipts. It’s unlikely that Universal’s PVOD test would have brought in as much, even if the studio decided to roll it out nationwide. Try explaining that to talent whose contracts are tied to theatrical box office gross.

So earlier today Universal released a prepared statement reversing their decision to test PVOD with “Tower Heist”:

“Universal Pictures today announced that in response to a request from theater owners, it has decided to delay its planned premium home video on demand (PVOD) experiment. Universal continues to believe that the theater experience and a PVOD window are business models that can coincide and thrive and we look forward to working with our partners in exhibition to find a way to experiment in this area in the future.”

Before Universal’s original plan was made public, they reached out to key theater owners to inform them of their desire to release “Tower Heist” on PVOD. I’m not sure what came of these conversations or whether they were more of a warning to exhibitors rather than a request or negotiation. Jon Fithian, head of the National Association of Theatre Owners, who had been mum on Universal’s plans until today, referenced this ongoing dialogue in his response to the studios about-face:

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Universal Hopes “Tower Heist” Will Pass The Premium-VOD Test

Tower Heist

In what the Los Angeles Times called “an audacious move” earlier this week, Universal Pictures announced earlier this week that it would allow the Eddie Murphy action comedy “Tower Heist” to be shown via premium-video-on-demand three weeks after its November 4th release date. Naturally, if Universal finds premium-VOD to be profitable without gutting their theatrical box office receipts, you can bet every other studio will follow their lead.

Of course, exhibitors aren’t big fans of premium-VOD or shortening the theatrical window from its current 90-day average in any form. Their big fear is that patrons will be accustomed to simply wait for a movie to be available at home rather than head to the theater not only lowering attendance but also permanently damaging concession sales.

The biggest downside of Universal’s plan, besides ticking off exhibitors, is the whopping USD $59.99 cost of screening “Tower Heist” in the comfort of your own home. During a time when news reports have the world headed toward another recession that kind of price might cripple sales. After all, USD $60 is roughly the price of six tickets on average at a movie theater.

However, it is tough economic times in the first place that is causing the movie industry to experiment with premium-VOD as they try to replace sagging DVD sales. But you probably already know that. In fact, you probably also know that theater owners will be just a angry about Universal’s current plans as they were this spring when the studio, along with three others, struck a deal with satellite television provider DirecTV to make a handful of titles available for premium-VOD 60 days after theatrical release for USD $29.99.

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Odeon, Italy and AMC Reach Deal With Disney On “Alice”

Alice In Wonderland - Alice.jpgExecutives at Walt Disney Studios must be breathing a huge sigh of relief having reached a deal with Odeon Cinemas in the United Kingdom and Italian exhibitors to show their upcoming tentpole release “Alice In Wonderland”. Additionally, Disney reached an accord with AMC Theatres to show the Tim Burton helmed film in North America when it is released on March 5th.

After announcing their plans to release “Alice In Wonderland” on DVD in June, just three months after its theatrical release rather than the usual four months, Odeon, the U.K.’s largest cinema chain, publicly threatened to boycott the film. So did exhibitors in Italy. AMC never made any public statements about a boycott, but delayed signing any agreement to show the film. Most of the details about the agreements were kept private by both parties, but according to a story in Variety, here is what we know:

  • In the U.K. Disney will not begin advertising the DVD until six to eight weeks after the film hits theatres.
  • In Italy, Disney will release three big movies during the summer, rather than waiting until fall. Traditionally, the summer box office grosses have been tepid compared with those in autumn. “Prince of Persia: The Sands of Time” will open on August 20th, while “Toy Story 3″ and “The Sorcerer’s Apprentice” will also open have summer playdates.
  • Disney has extended the release of “Alice In Wonderland” on DVD from 12 weeksafter its theatrical to 13.

In the U.K., assurances were given that the studio won’t begin advertising for the DVD until six or eight weeks after the theatrical bow. It’s likely that exhibs elsewhere asked for the same terms.
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A Recap Of Disney’s Adventures With “Alice”

Alice In Wonderland.jpgSurely Walt Disney Studios was hoping their upcoming release “Alice In Wonderland” would generate a lot of media attention before it hits theatres on March 5th, though they probably weren’t trying to create the kind of buzz the picture received over this past week. Theatre owners in North America and Europe protested when the studio announced it would move up the DVD release of the movie to early June, just three months after Tim Burton’s adaptation of Lewis Carroll’s classic is distributed theatrically.

The announcement was made on February 8th by Disney’s CEO, Bob Iger, during an earnings call and seemed to come as a surprise to many. A surprising number of newspapers, websites and radio shows beginning running numerous stories about the dispute just two days later and through the course of last week. In fact, the Los Angeles Times managed to sum up the latest battle over movie release windows rather nicely:

The flare-up illustrates how an arcane topic once only of interest to Hollywood executives can affect moviegoers around the world.

The L.A. Times, along with The Wrap, touched on the fact that studios have been meeting with key North American exhibitors (probably Regal Cinemas, AMC Theatres and Cinemark) to negotiate a deal on shortening theatrical release windows. These meetings weren’t done surreptitiously. In January John Fithian, President of the National Association of Theatre Owners, told attendees of the International Cinema Technology Association’s tech conference that theatrical windows would be changing to help studios maximize revenues from home releases:

“As a person who represents the cinema industry I’m not going to tell you that we’re very happy that that model is going to change, but it has to. But it has to change logically and it has to change with studios and exhibitors sitting down together and analyzing the models. It’s not a great secret, this is happening. Leading studio executives, leading cinema representatives are talking about what these models should look like. The good news is we’re all at the table talking. That’s much better and much more cooperative than if studio x decided just to abandon the model and release a major picture in the cinema and in the home roughly at the same time. That’s not going to happen. What’s going to happen is some scientific thinking and some research and a deliberative process to maximize the model for the studios without killing the model for exhibition.”

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