Tag Archives: John Fithian

Cinema’s Dangerous Addiction to Sodas

The Killer Inside Me -  Photograph: Mario Tama/Getty Images

The Killer Inside Me – Photograph: Mario Tama/Getty Images

The past couple of months have not only seen the 50th anniversary of the Beatles appearing on the Ed Sullivan Show and the premier of Stanley Kubrick’s nuclear satire Dr Strangelove: or, How I stopped Worrying And Learned to Love the Bomb. It is also 50 years since the landmark report Smoking and Health: Report of the Advisory Committee to the Surgeon General, delivered on Saturday 11 January 1964, so as not to rock the stock markets but also to get maximum publicity in the sunday newspapers. Five years later cigaret ads were banned from radio and television. You’ve probably seen it featured on Mad Men.

This anniversary should make exhibitors ponder whether they too will soon find themselves on the wrong side of history when it comes to sodas and sugary drinks. The initial battle may have been won by Big Soda, but it is becoming increasingly clear that there is a long war ahead.

Defending ‘Freedom’ and ‘Choice’

NATO President John Fithian delivered a robust response to New York Mayor Bloomberg’s attempt to ban large cup sizes of sodas, in his keynote at CinemaCon’13, devoting an entire paragraph of his speech to it:

Cinema patrons deserve the freedom to choose the food and beverages they want. That important consumer choice extends to serving sizes as well. I congratulate our associates at NATO of New York for their successful law suit against Mayor Bloomberg’s attempt to regulate consumer choice. If a patron wants to splurge and have a big Coke, they can. Or if they want a healthier option, they can make that choice too, without the government choosing for them.

That’s five uses of the word “choice” in just one paragraph, as well as the all-important term “freedom“, in framing the conflict as one between individuals’ freedom of choice against government attempt to regulate and remove that choice. This argument won the day in the courts, as reported by FJI’s Concessions Editor Anita Watts:

The biggest news of late on drink size restrictions in New York City is that they were struck down again. On July 30, the First Division of the New York State Supreme Court’s Appellate Division upheld the first ruling against the ban, saying the proposed law was unconstitutional. In March of this year, New York Supreme Court Judge Milton Tingling had ruled that New York City could not enforce the ban. His decision came a day before the ban was set to be enforced. Tingling called it arbitrary, capricious and beyond the city’s regulatory powers.

Exhibitor’s won the battle in courts and with Mayor Bloomberg replaced by Mayor de Blasio, who is more worried about the size of income inequality in NYC than by size of servings of Pepsi, the battle might seem to be over (1). But far from it.

NY, CA, SF, VT, HI and Mexico

This month it has become evident that the battle has merely shifted from New York and gone east and south, where it looks likely to find more fertile ground. California is the first US state where sodas could be forced to carry warning labels, just like cigaret packets do, according to the Sacramento Bee.

California would become the first state to require warning labels on sodas and other sugary drinks under a proposal a state lawmaker announced Thursday.

SB1000 would require the warning on the front of all beverage containers with added sweeteners that have 75 or more calories in every 12 ounces. The label would read: “STATE OF CALIFORNIA SAFETY WARNING: Drinking beverages with added sugar(s) contributes to obesity, diabetes, and tooth decay.”

Picture that facing movie goers lining up to buy concessions or on the side of the 16oz cup of soda dispensed in the multiplex, blocking part of the Avengers 2 promotion. But with the law proposal enjoying the backing of both the California Medical Association and the California Center for Public Health Advocacy, it is hard to argue against it. Not least as it does not technically infringe ‘choice’.

This is not a lone law attempt to tackle soaring obesity levels in North America:

- Vermont proposed a similar law last year, which is currently held up in the Committee on Human Services;

- San Francisco is proposing a referendum to approve a tax on soda and other sweetened drinks at a rate of two cents per ounce;

- Similar proposal to SF’s were previously put forward in Richmond and El Monte (a Los Angeles suburb), but were defeated by the drinks industry;

- A Soda Tax was approved in Maine in 2008 but repealed two years later following “a major lobbying effort from the American Beverage Association. Voters in Washington state similarly reversed their legislature in 2010″ (link);

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CinemaCon 2011: Fithian Urges NATO Members To Begin Digital Transition

John Fithian At CinemaCon 2011

John Fithian At CinemaCon 2011

John Fithian, President of the National Association of Theatre Owners, gave his annual State of the Industry address yesterday at the trade group’s inaugural CinemaCon convention in Las Vegas. His speech covered all the necessary points while reiterating some of the comments about the digital cinema transition which Fithian has made to smaller groups over the past several months.

He began with a handful of statistics that highlighted some economic figures, including a global box office which climbed 30% over the past five years to reach USD $31.8 billion in 2010. North American box office receipts rose 15% to USD $10.6 billion in that same period, while inflation only rose 8%. In what was perhaps a jab at the studios rumored plans to begin offering new films via premium video-on-demand, Fithian compared these numbers to home video sales, which have declined 13% during the past five years.

Fithian also provided an update on North America’s digital cinema roll out, telling the audience of over 2,000 delegates that almost 16,000 screens, out of a total of 39,000 had been converted to digital. Nearly 9,000 of those screens are equipped for 3D projection. After running through more industry numbers than most could ever remember, Fithian paused as he came to the most important point in his speech:

“For any exhibitor who can hear my voice who hasn’t begun your digital transition, I urge you to get moving. The distribution and exhibition industries achieved history when we agreed to technical standards and a virtual print fee model to enable this transition. But the VPFs won’t last forever. Domestically, you must be installed by the end of 2012 if you want to qualify. Equally significantly, based on our assessment of the roll-out schedule and our conversations with our distribution partners, I believe that film prints could be unavailable as early as the end of 2013. Simply put, if you don’t make the decision to get on the digital train soon, you will be making the decision to get out of the business.”

Fithian went on to remark that admissions had climbed in each of the last four decades and that 3D grosses in 2010 made up 21% of total receipts, doubling the amount such films earned in 2009. However, his earlier comments about the ongoing digital cinema transition is what most of the show’s attendees focused on after Fithian’s speech concluded. Was it true that all cinema owners had to convert their screens to digital before 2012 to qualify for a VPF? Are studios really going to stop distributing 35mm film prints after 2013?

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First Run Movies Headed Into The Home At Premium Prices

Prima Cinema Logo.jpgThe debate over motion picture release windows heated up again last week as two studios spoke openly about their plans for allowing limited home viewing of movies shortly after their theatrical opening. In addition, news came of a pricey new service looking to make films available in living rooms day-and-date with their theatrical launch.

On Tuesday, Sony’s CFO, Rob Wiesenthal, said that his company was not only looking to cable and satellite operators to provide early releases for the studio’s titles, but has high hopes for its new streaming video service, Qriocity. The service was established earlier this year to beam content directly into Sony’s consumer electronics products (televisions, video game consoles, Blu-Ray players, etc.).

Speaking at the UBS Global Media and Communications Conference in New York, Wiesenthal spoke of the “big white space” between theatrical and home video release dates for movies, stating there was “a real consumer desire for a premium offer” for such content. He did not cite any studies or reports to back up the claim that consumers were clamoring for such services.

In fact, it often seems that the only people making such statements publicly are the studios themselves, rather than moviegoers. This is probably because a number of studios are exploring premium video on demand models that will enable them to release movies for home viewing during their theatrical window but with significantly hire prices; around $30 per viewing.

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

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:

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NATO To Transform ShoWest Into CinemaCon

CinemaCon Logo.png
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:

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Fithian Keynote Kicks Off ICTA Tech Conference

John Fithian of NATO

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.

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The MPAA’s Motive In Upsetting Exhibitors Over Release Windows

mpaa-fcc.png

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:

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Booming U.S. Box Office Makes Headlines

John Fithian of NATO

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 »

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

Paramount Pictures LogoOn 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.
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Cinemas: “Recession? Bring it on!”

coffee recession

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.