Tag Archives: John Fithian

MPAA’s Glickman, NATO’s Fithian Deliver Upbeat Industry Prognosis

March 17, 2010

Gan Glickman & John Fithian (ShoWest - March 16, 2010).jpg

Dan Glickman and John Fithian at ShoWest

The National Association of Theatre Owners president, John Fithian, and the outgoing chairman of the Motion Picture Assn. of America, Dan Glickman, trumpeted 2009’s record breaking box office grosses as well as advances in piracy protection during their annual “State of the Industry” address at ShoWest on Tuesday. What seemed more important to everyone in attendance however was that the speech marked the last appearance by Glickman as the head of the MPAA.

Not that Glickman plans on disappearing entirely. As he put it moments before walking onstage to deliver his remarks, “It may not be my last time at ShoWest, hopefully it is not. John has promised to invite me every year, but it’s my last time in this job.” Glickman is leaving his post April 1st to take over as head of the non-profit organization Refugees International.

Of course, technically this will be the last time Glickman attends ShoWest since NATO will be taking the show over next year and changing its name to CinemaCon. Glickman may not have to worry about getting an invite though, for Fithian had nothing but kind words to say about him. “He really has contributed an amazing amount of leadership and support to this industry over the last six years, from intellectual property to the ratings system to opening up new markets oversees,” Fithian said of Glickman. He’s been just a terrific partner. . . he will be sorely missed by those of us in the movie business.”

Speaking of the movie business, it’s apparently doing quite well, at least theatrically. Fithian highlighted the USD $30 billion international box office gross earned in 2009 with USD $10.6 billion coming from North American, an increase of more than 10%. The NATO exec credits the ongoing theatrical success to advances in technology which have allowed for better presentations at modern luxury cinemas and the ease of purchasing tickets on mobile devices or online. Studios were also major contributors by spreading out their releases according to Fithian:

Read More »

Posted in Events

Comments

NATO To Transform ShoWest Into CinemaCon

By J. Sperling Reich

March 16, 2010

On the first day of this year’s ShoWest, the National Association of Theatre Owners (NATO) has made it known that when they take back the event next year it will undergo a name change to CinemaCon. The logo being used for the annual convention of theatre owners and movie distributors can be seen above.

ShoWest (which is taking place in Las Vegas now through March 19th) was originally NATO’s annual trade show. The group still co-produces the event, however ten years ago they contracted with the Sunshine Group to actually organize and run it. Since then, the Sunshine Group was purchased by Nielsen Business Media who ran the conference as a for-profit endeavor. In 2008, NATO announced it would launch it’s own convention in 2011, once the contract for ShoWest expired. Since the ShoWest name is now owned by Nielsen, NATO had to come up with a different moniker.

In talking with NATO spokesman Patrick Corcoran about the new show he stated, “By running a new non-profit convention, NATO can provide greater value at lower costs to theater industry. Having a show run by and for the industry allows us to celebrate and promote moviegoing in a way that benefits the industry and our customers.”

NATO’s president, John Fithian, echoed Corcoran’s comments during a press conference held early Tuesday morning, just before his annual State of the Industry address:

Read More »

Posted in Trade Shows

Comments

Fithian Keynote Kicks Off ICTA Tech Conference

By J. Sperling Reich

January 20, 2010

John Fithian of NATO

Not even a record setting rain storm could keep cinema professionals away from the Universal Hilton in Universal City yesterday where the International Cinema Technology Association was holding it’s annual tech conference. After a Monday evening cocktail reception, the program began in earnest with a keynote address from John Fithian, President of the National Association of Theatre Owners.

In a speech billed as a “State of the Industry” in the conference schedule, Fithian covered a wide range of hot button topics not all of which were geared strictly to many of the motion picture engineers in the room. He began by recapping the box office records that were shattered in 2009, a year which saw North American combined grosses surpass the USD $10 billion mark. Fithian was quick to point out that such earnings were not due to just the rise in ticket prices, but rather an increase in the number of patrons visiting cinemas nationwide. In fact, decade-over-decade, the average number of moviegoers rose from 995 million in the 1970’s to 1.13 billion in 1980’s upwards to 1.28 billion in the 1990’s settling at 1.44 billion for the decade which just ended.

A good portion of Fithian’s talk was focused on many of the reasons 2009 was such a spectacular year for the cinema business and how the industry might continue to grow even more. He detailed three key drivers he believed were responsible, not the least of which was the major studios getting better at understanding there are 12 months in the calender. Fithian stated:

For years we put out everything in the summer, we put out everything in the holidays and you couldn’t find an person in the cinema in February or September. That is no longer the case…. we’re getting good pictures that appeal to different demographics with different genres spread throughout the 12 months and that’s fantastic. That’s what we have to have.

Affordability of movies as a form of entertainment was the second reason Fithian gave for 2009’s growth. Despite the increase in ticket prices over the years, and even with the premium for 3D films, the price of a movie ticket has not outpaced inflation. In 1969 the price of a movie ticket in the U.S. was USD $1.42. In 2009 that price had risen to a nationwide average of roughly USD $7.56. If ticket prices had kept up with the rate of inflation, then starting with USD $1.42 in 1969, we should presently have an average ticket price of USD $8.37.

Posted in Events

Comments

The MPAA’s Motive In Upsetting Exhibitors Over Release Windows

By J. Sperling Reich

November 9, 2009

Last Thursday when the Motion Picture Association of America made public an ex parte communication they sent to the FCC in defense of a waiver request it caused a flurry of headlines about studios going to war with exhibitors over release windows. To be sure, the letter sent by the MPAA’s lawyers, as well as the press release they sent out the same day directly refer to release windows. The headline of the press release boldly reads “MPAA Seeks FCC Okay For Transmission of First Run Movies Directly To Consumers”. However the MPAA may simply be hiding behind the concept of protecting content during shortened release windows as camouflage for their true motive; securing high definition digital content as it is distributed into the electronic ether of the home by controlling which devices can playback and display the content.

The MPAA’s letter was sent as a rebuttal to a communication sent to the FCC in October by Public Knowledge arguing the waiver not be granted. PK (as they are often referred to) is based in Washington D.C. and considers and is a public interest group that focuses its efforts on digital technology. The second paragraph of the MPAA’s letter and third paragraph of the press release reads in part:

As MPAA has detailed throughout this proceeding, grant of the waiver would for the first time allow millions of consumers to view high-value, high-definition theatrical films during an early release window that is not available today. MPAA has explained that release of this high-value content as part of an earlier window, especially with respect to movies released for home viewing close to or even during their initial theatrical run, necessarily requires the highest level of protection possible through use of SOC.

Ignoring the reference to SOC for the time being (I’ll get to it in a bit), one can see how the phrase “close to or even during their initial theatrical run” might make motion picture exhibitors angry enough to storm MPAA headquarters. It didn’t help that outgoing MPAA Chairman and CEO Dan Glickman is quoted in the press release saying:

Read More »

Posted in Organizations

Comments

Booming U.S. Box Office Makes Headlines

By J. Sperling Reich

March 16, 2009

John Fithian of NATO

These days, with the global economic crisis at full force dominating headlines, it seems mainstream media will jump on anything that even smells like positive news. So, it’s no wonder with North American box office earning a billion dollars in January and an additional US $800 million in February that media outlets would break their tradition of only covering box office grosses on Monday mornings in favor of feature stories about how moviegoers have returned to theatres.

A spate of articles in various publications was kicked off on February 25th by Andreas Fuchs’ Film Journal piece in which John Fithian, president of the National Association of Theatre Owners (NATO), holds forth in a “state of the industry” interview. A good portion of the lengthy piece is devoted to the current state of the digital cinema transition, which Fithian still believes will heat up in 2009 despite any financial woes. Fithian then goes on to describe the exhibition industry as being “recession-resilient” though stopped short of calling it “recession-proof”:

“The cinema is a relatively inexpensive way to be entertained. If people don’t have money to go on a big vacation, they take a mini-holiday at their local movie theatre. So the environment of challenging times is generally good for us, but that doesn’t mean it always works. You need to have good movies. People are not going to escape the burdens of the day by going to see a bad film.”

While U.S. box office set an all time record in 2008 with US $9.79 billion in grosses, Fithian points out that admissions were actually down 2.5% Read More »

Posted in Business

Comments

Paramount Goes Direct-To-Exhibitors With D-Cinema Deal

By J. Sperling Reich

January 22, 2009

On the eve of the National Association of Theatre Owners’ meeting with equipment vendors to review digital cinema requirements on Friday, Paramount Pictures has thrown the exhibition industry a curve ball in the hopes of resuscitating the stalled rollout of the technology. Rather than work solely through integrators such as Digital Cinema Implementation Partners (DCIP) and Cinedigm (formerly AccessIT), Paramount has become the first Hollywood studio to offer North American exhibitors financial assistance for digital cinema installations.

What’s significant about Paramount’s announcement is that previously studios have refused to cut deals to reimburse exhibitors for digital cinema installations directly with exhibitors for fear of future anti-trust litigation. Instead, they relied on digital cinema systems integrators to provide a buffer between themselves and theatre owners. But, with the digital cinema rollout at a near stand still, Paramount seems to be throwing caution to the winds.

Paramount has a vested interest in seeing digital cinema take off, specifically to increase the number of 3-D capable projection systems. This March the studio will be releasing Dreamworks Animations’ “Monsters vs. Aliens” in 3-D and presently the United States and Canada only have about 1,200 screens properly equipped with 3-D systems. Paramount has been promoting the film heavily for nearly a year at industry trade shows and will be airing a 3-D commercial for the movie during the upcoming Super Bowl telecast.
Read More »

Posted in Digital Cinema, Distributors

Comments

Cinemas: “Recession? Bring it on!”

By Patrick von Sychowski

July 16, 2008

Recession is now a fact, but cinemas appear fairly nonplussed. Is this wishful thinking or actually born out by past experience? The UK’s The Guardian seems to think the latter, pointing out that box office takings rose in five out of the last seven recessions in the US:

“Hollywood gets bump from slump” was the trade bible Variety’s front-page headline, and industry analysts believe the relatively low cost of going to the cinema and the prospect of offering an escape from financial concerns for two hours will give cinema chains some resilience.

In Britain, box office revenues and cinema attendances continued to rise throughout the late 1980s and early 90s as the multiplex revolution swept through the country and going to see a movie again became a viable, low-cost leisure option for millions.

“Box office revenues definitely came up in the early 90s. As far as I can see there’s very little evidence to show cinema attendance suffers in a recession. If anything, it does quite well,” said David Hancock, head of film and cinema at Screen Digest.

This sentiment was echoed by the heads of both NATO and Regal cinemas in a recent interview in THR.com:

THR: Exhibition tends to be recession-resistant, but wouldn’t a spreading recession hurt concession sales?

Campbell: This is the most affordable out-of-home entertainment option that consumers have available, but at some point, do people stop buying concessions? I don’t think so. At some point, people may be a little more selective in some of their purchases, but at this point in time we haven’t seen that.

THR: Do hard times hurt smaller chains and mom-and-pop exhibitors more?

Fithian: I don’t believe there is a different impact on smaller chains in hard economic times. In fact, it is often the consumers in smaller markets who are most challenged during recessions. So they don’t take the vacation. Higher gas prices mean they don’t go for long drives to theme parks or other places. They stay closer to home, and when people stay closer to home, they tend to go to the cinema more often.

The optimism seems to be backed up by numbers from screen advertising in the US, again from THR.com:

CAC president and chairman Stu Ballatt predicted that the industry’s double-digit percentage growth path would continue “for the next few years at least.”

He said a sluggish U.S. economy does not seem to slow marketers’ willingness to put money into cinema promotions. For example, Ballatt cited increased activity across many sectors, with cinema ad spending by packaged goods and retail companies showing particularly strong growth during the past six to 12 months.

Cinemas and Hollywood are ‘fortunate’ in the sense that the past couple of years stagnation and even slump (once you look at actual attendance, as opposed to BO growth) could be blamed on poor films, whereas this summer’s crop has performed better - and this is before the fantastic Dark Knight opens (we’ve seen it and we know it is going to make Iron Man look like Tin Man when it comes to both critical and audience acclaim).

But there are those that doubt that cinemas will escape the brunt of the recession unscathed. Foremost amongst them The Guardian’s resident Hollywood contrarian Jon Patterson:

As for the benighted ticket-buyers, I wonder this time if they’ll display the same bovine sense of product loyalty the moguls depend on when times are tight. During the Depression, a movie ticket bought you a cartoon, a newsreel, a B feature and a marquee-topper - something like four hours of entertainment for a nickel (the price of a gallon of gas or a pack of smokes back then). A bargain if you needed to escape your troubles or just eat up dead unemployment time - and the movies were good enough that around 5bn tickets were sold between 1934 and Pearl Harbor. It was hard to feel Greatly Depressed when Astaire and Rogers, Gary Cooper, the Marx Brothers or Eddie Cantor were living it up on screen.

But things are different now, and films aren’t nearly the draw they were then. In 1938, the movies competed only with such distractions as booze, sex, God, the radio or political agitation; there was no streaming online video, no computer games, no 60in plasma TVs, no home-movie market whatsoever. If the economy collapsed tomorrow, would seeing Transformers 2 alleviate your misery or simply compound it? Dear viewer, you have options!

In the insurgent spirit of that turbulent decade, let’s call for a Netflix Revolution: we just stay home and watch as many movies as we like for 13 bucks a month. Those moguls could use a little sojourn in Hooverville - it might improve their movies, too.

Cineflix or Netflix - the choice is yours. Let’s see where the tally stands at the end of the summer.

Posted in Analysis

Comments

NATO and Warner Bros. Duke It Out

By J. Sperling Reich

July 15, 2008

Even before the ink was dry on last Thursday’s Los Angeles Times article about the struggle Hollywood studios face in finding enough digitally equipped screens to distribute 3-D movies, The Hollywood Reporter published a story that had key industry executives debating who is to blame for the slow rollout of digital cinema. Representing distributors was Dan Fellman, Warner Bros.’ president of domestic distribution, while exhibitors were repped by John Fithian, the president of the National Association of Theatre Owner. The article has the two exchanging verbal barbs, each blaming the other side for the lack of digital cinema installations.

The Reporter makes it seem as if Fithian was responding to statements Fellman made at a public forum, however they don’t say whether Fellman’s quotes come from any specific event or speech or simply an interview they conducted. It was the pending release of Warner Bros.’ 3-D flick “Journey to the Center of the Earth” that brought the issue to a head, which is why the distribution exec opened with:

“3-D is the future, so why is exhibition dragging its feet? I’m pleased ‘Journey’ will be the biggest digital 3-D release to date. But it is disconcerting that since November, the 3-D screen count has only gone up. . .”

Fellman’s quote is abruptly cut off by The Reporter - presumably a typo. Fithian was quick to answer however, in saying:

“It is particularly ironic and frustrating that a senior executive from Warner Bros. would accuse exhibition of ‘dragging its feet’ on 3-D when Warners has been the absolutely slowest of all major studios to come to the table with support for the d-cinema rollout. If Warners believes there are an insufficient number of 3-D screens in the marketplace today, they have no one to blame but themselves and they know it.”

What Fithian is referring to is Warner Bros. reluctance to enter into virtual print fee (VPF) agreements that provide an exhibitor a subsidy for the installation of digital cinema equipment. In essence, the studio will pay a fee for every screen one of their movies play on and that fee will go toward the purchase of D-cinema equipment. System integrators such as Digital Cinema Integration Partners and Access Integrated Technologies have been trying for some time to negotiate a VPF deal with studios and Warner has proven one of the few holdouts. The studio has only signed one agreement with XDC for rollouts in Europe. Because that deal pegs the VPF at USD $850, many in the industry have argued that Warners was simply trying to remove doubt they were serious about digital cinema by signing the cheapest contract they could find.

Whatever Warner Bros. reasoning for shying away from VPF deals, Fellman believes the studio has firmly supported D-cinema:

“Warner Bros. has released more films digitally than any other studio, without question. Our discussion is with exhibition, circuit by circuit, and John has never attended one business session at which any Warner exec was present. . . We are continuing to serve every digital theater that request a (digital) print. We stand by our record.”

Despite Warners’ track record, Fithian definitely faults the major studios with holding hope the world-wide digital cinema roll out:

“Exhibition stands ready to provide our patrons in the U.S. and around the world with wider access to exciting 3-D technologies as soon as all of our partners in distribution come to agreement on the level of support they will provide for the underlying digital cinema infrastructure. You cannot have 3-D without D-cinema. And we cannot have digital cinema by ‘negotiating’ through the media.”

Negotiating?! Seems more like they are arguing to me. Though that could well pass for negotiating in Hollywood.

Posted in Digital Cinema

Comments

Stop Whining And Be Grateful For Those Cheap Cinema Tickets

By Patrick von Sychowski

April 28, 2008

Borat movie ticket The LA Time’s cinema columnist ‘Projector’ has a humorous op-ed piece echoing the NATO/MPAA song that going to the cinema is still the cheapest form of entertainment. Not just compared to going to a sporting event or visiting the opera, but even compared to trips to the picture palace of yesteryear. But he doesn’t fall for the popcorn merchants propaganda hook-line and sinker:

Of course, Projector is too savvy to entirely buy the exhibitors’ assertion that movies “remain the most affordable form of out-of-home entertainment.” They never considered a brisk 5K jog around the Rose Bowl, nor open-mike poetry night at many coffeehouses.

And movie popcorn and other snacks are notoriously pricey, which explains why theaters generate roughly 20% of their revenue but 40% of their profit at the concession stand.

Ironically, the high cost of goodies helps moviegoers, according to new research from Stanford University and UC Santa Cruz, because concession revenue enables theaters to keep ticket prices in check. Projector, who only went to a state school, can’t argue with that logic.

There is even some advice for the savvier cinema goer:

Frequent filmgoers can save several hundreds of dollars a year by selecting theaters and showtimes carefully. Sure, the Rolling Stones’ concert movie “Shine a Light” is worth $15 a ticket on a large Imax screen at the AMC CityWalk Stadium 19, but if cash is tight, consider a $5 matinee of whatever is playing at the pleasant-enough, single-screen Vista Theatre in Los Feliz. Some chains also offer bulk ticket discounts, but beware of any restrictions.

If your movie is showing at the mall, you can live dangerously by smuggling in a Mrs. Fields cookie or a packet of sour gummy worms, thereby supporting a broader swath of the economy. Projector, of course, can’t condone such a potentially flagrant violation of theater policy. He’s just sayin’.

Those interested in the Stanford University and UC Santa Cruz concession revenue report can find out more here. From the press release:

The findings empirically answer the age-old question of whether it’s better to charge more for a primary product (in this case, the movie ticket) or a secondary product (the popcorn). Putting the premium on the “frill” items, it turns out, indeed opens up the possibility for price-sensitive people to see films. That means more customers coming to theaters in general, and a nice profit from those who are willing to fork it over for the Gummy Bears.

Indeed, movie exhibition houses rely on concession sales to keep their businesses viable. Although concessions account for only about 20 percent of gross revenues, they represent some 40 percent of theaters’ profits. That’s because while ticket revenues must be shared with movie distributors, 100 percent of concessions go straight into an exhibitor’s coffers.

Although if distributors could decide they would get a share of that revenue and profit as well. Equally interesting is another finding:

In another study examining Spanish theaters, the researchers discovered: Moviegoers who purchase their tickets over the Internet also tend to buy more concession items than those who purchase them at the door, by phone, at kiosks, or at ATMs (the latter option has not yet hit the United States). More research is needed to figure out why, but for now this suggests that theaters may want to be sure to partner with an Internet service to make such ticketing available–or even take the function in-house.

People who come to the movies in groups also tend to buy more popcorn, soda, and candy, Hartmann and Gil found. While this, too, merits more investigation, it may be that such groups comprise families or teenagers. “If that turns out to be the case, it may be that theaters will want to run more family- or adolescent-oriented movies to attract a more concession-buying crowd,” Hartmann says.

No surprise there either that John Fithian is arguing for more PG films. He knows which side his popcorn are butter coated on. Those wishing to download the research paper can find it in PDF form here.

Photo credit: www.mobilnews.cz/blog

Posted in Concessions, Market Research

Comments

D-Cinema Frustrations Aired At NAB

By J. Sperling Reich

April 15, 2008

Despite the slew of news stories coming out of the Digital Cinema Summit at the NAB Show this past weekend there was little new to report regarding technological advances and nascent business deals. In fact, the if the only real news that seemed to come out of the summit was the frustration over the fact that there was little new to talk about.

Because the summit is held a month after ShoWest the expectation going in was that nothing major would be announced by major players in the space such as studios, integrators or vendors, though some industry players used the forum to voice their opinions, controversial or not, about the lack of speed with which d-cinema is being adopted. Attendees were dealt a one-two punch during the Sunday sessions by speakers Michael Karagosian of MKPE and John Fithian, the President and CEO, National Association of Theatre Owners.

Moderating a morning panel discussion titled “The Exhibition Perspective: Truth and Consequences in the D-Cinema Rollout” Karagosian highlighted the issues acting as roadblocks to d-cinema adoption, including the dwindling virtual print fees (VPFs)studios are willing to pay. Some studios, such as Warner Bros. have been slow to sign up to VPF agreements, or haven’t signed them at all. According to The Hollywood Reporter Karagoisan suggested:

. . . .that if one major studio held back annually on just two blockbuster titles that the exhibitor contributions might grow from 20% to 32% of the total.

This could be a real problem since, as Karagosian pointed out, the cost for an exhibitor to make the conversion to digital could be as high as 200% - 300% more than sticking with current film based systems over the next 25-years.

After lunch, John Fithian gave a dutch uncle keynote address which had everyone buzzing, since he played no punches in pointing out the pending “train wreck” the industry could be headed for if the number of d-cinema installations don’t increase before 2009 when studios plan on releasing 10 films in digital 3-D, including James Cameron’s “Avatar”. Variety reports that Fithian stated of the upcoming releases:

“We don’t have the screens for them. We have less than 1,000 3-D screens in the U.S. and fewer than that in the rest of the world.”

Fithian then turned his attention to the stalemate occurring between studios and exhibitors over VPFs which are meant to subsidize the rollout of D-cinema equipment.

“Unless the deals are done in the next month or two we won’t have time to do the installations in time. We literally need the deals now to make the slate work. If the studios want this to happen in time for 2009, the deals have to be struck, and they have to be struck right now.”

Whether VPF agreements start closing or not some exhibitors may still take a wait and see approach. Mark Collins of Marcus Theatres, who participated in Karagosian’s panel discussion, said of his circuit’s conversion to digital:

“We have not seen any cost benefits. We need to start promoting digital cinema as something that is different from what (moviegoers) have.”

Though many in the industry have made similar statements, Collins may be onto something as this type of marketing approach has worked in the past during the rollout of digital audio in movie theatres.

The summit also played host to the usual suspects from studios, such as Howard Lukk, Disney’s Vice President of Production Technology and Wendy Aylsworth, the Sr. Vice President of Technology at Warner Bros. Both spoke mostly of technical issues such as the need for more 3-D production and post-production equipment. Aylsworth focused on the problem of subtitles in 3-D content, a topic she previously presented with a great depth of knowledge at the SMPTE conference in October of 2007.

Posted in Events

Comments