Anyone who missed last week’s CJ Cinema Summit featuring guests David Keighley and Craig Dehmel from IMAX, have no fear, you can watch the session on demand here.
For those of us living in the United States, the past two months has been filled with countless political ads and endless media coverage of divisive campaigns leading up to Election Day on 8 November. One campaign making a lot of headlines is the Los Angeles mayoral race between Congresswoman Karen Bass and real estate magnate Rick Caruso. I can not argue the merits (or flaws) of either candidate, for which I have no expertise. What I can clarify though is why so many within the cinema industry, especially in Los Angeles, feel ill at ease with Caruso’s entry into politics, especially given the timing of his current campaign.
Most Angelenos have become quite familiar with Caruso over the past two decades as the developer behind some of the cities highest profile commercial projects including, The Grove at Farmers Market in Los Angeles, the American at Brand in Glendale, the Commons at Calabasas (where I happen to live) and the Palisades Village in Pacific Palisades. I picked these four retail properties on purpose, though I easily could have picked the Encino Marketplace, The Promenade at Westlake or half a dozen others. However the four I’ve chosen are those with cinemas as anchor tenants. Taking a closer look at how cinema operators have fared in Caruso’s properties explains the apprehension some feel about him becoming the next mayor of Los Angeles.
To provide some context, Caruso’s properties are picturesque representations of what Main Street USA might look like in a Frank Capra movie. They have been described as urban fantasylands where “Frank Sinatra music wafts through the air and the trolley never stops running. It even snows fake snow at Christmastime.” But as more than a few architecture critics have noted, most of Caruso’s Los Angeles properties look great from the inside while walling off the gritty reality of the outside world and providing little for the surrounding community to look at other than parking garages and blank stucco walls.
Even so, prior to the pandemic The Grove attracted 20 million visitors per year, more than the the Great Wall of China and Disneyland. That explains how Pacific Theatres built two of the highest grossing multiplexes in the nation; a 14 screen cinema at the Grove and an 18 screen theatre at the Americana. Meanwhile, the Regal Edwards Calabasas at the Commons was a six screen venue which, while a little outdated, attracted lots of senior industry professionals who lived in the nearby suburbs. Cinépolis USA opened the five screen its Pacific Palisades Bay Theatre in November 2018.
Even before COVID shut down movie theatres throughout Los Angeles County for over a year, at least two of these cinema locations were thorns in their operators’ sides. The Edwards in Calabasas was always “on the bubble” of being profitable. Cinépolis saw very quickly that operating the Bay Theatre amidst a neighborhood of A-list filmmakers and C-Suite studio executives was not going to work; after all, this demographic tends to live in mansions which come with their own private screening rooms. You see, with the high-end locations and surroundings for which Caruso’s properties are recognized, comes the exorbitant rent that the billionaire is well known for charging.
And as all these operators found out, both before, during and shortly after the pandemic, getting out of a lease with Caruso is impossible. The company’s leases are ironclad and Caruso has a reputation for not negotiating on any clause or deal point. This led many industry insiders to wonder how Cinépolis, Pacific Theatres and Regal would be able to reopen locations at Caruso properties after the pandemic. Would Caruso cut a deal with operators to pay off back rent over time? Would the company forgive rent or at least lower it for the months when exhibitors were unable to operate due to local health restrictions?
Turns out, the answer to all those questions was a resounding no; Caruso wanted to be repaid in full, ideally before each venue reopened. While this was not the only reason Pacific Theatres (and its sister company Arclight Cinemas) went out of business, it was definitely one of the straws that broke the proverbial camel’s back. (AMC later picked up both The Grove and The Americana at Brand.) Cinépolis managed to get Netflix to take over the lease so they could show their films to awards voters in a theatre close to home. Regal reopened its Edwards Calabasas location, though it is unclear if they paid any of the back rent. A week after Cineworld, Regals owner, filed for bankruptcy this past September, the location was one of a dozen permanently closed. The rent for the Calabasas facility is so onerous, especially given the number of movie theatres in the area, that rumor has it no operator wants to take it on.
With this well trafficked backstory it is not hard to see why, despite all his worthy philanthropic efforts and record of job creation, so many cinema industry veterans cringe a bit when they see Caruso’s advertisements about how he’ll clean up Los Angeles, fix homelessness, lower crime and bring jobs to the city. He very well may be able to accomplish all these goals, though if history is any guide, it might be done in a rigid fashion with very little empathy in hopes of achieving some idealistic vision of an urban utopia replete with crowd pleasing water features.
Though, I’ll admit, the trollies might be a nice touch, especially if they run on time.
Premium Large Format
Russia’s Largest Cinema Chain Sues IMAX
Russia’s largest cinema chain has filed a lawsuit against IMAX, demanding that the large format company resumes operations in Russia. The lawsuit from the joint cinema chains Formula Kino and Cinema Park is due to IMAX pulling out of Russia on 1 June of this year, after Hollywood studios and other companies severed economic ties with Russia following the February invasion of Ukraine.
The lawsuit was filed on 26 October by the cinema chain’s legal entities Cinema Park and Rising Star Media. The lawsuit seeks to compel IMAX “to perform duties in kind,” i.e. to do what is written in their contract, rather than to pay compensation or fiscal damages and follows a ruling of the Arbitration Court in Moscow. In August the CEO of the Formula Kino and Cinema Park cinema chain, Alexei Vasyasin, stated in an interview that the chain planned to sue IMAX to comply with the terms of its contract if it does not resume work by the end of this year. Although the IMAX equipment belongs to the cinema chain, IMAX is thought to have forbidden it from being used to screen films.
Unlike regular digital cinema projectors, KDMs for films screened on IMAX systems are issued by IMAX rather than by distributors of each title. It is believed that Formula Kino and Cinema Park are pursuing the right to operate the equipment itself, but since the details of the company’s contract with IMAX are not known, the legal outcome of this case cannot be easily predicted.
Source: Celluloid Junkie
Cinemas
Chinese Cinema Openings Below 60%
The number of cinemas in China that are open has fallen below 60%, as “temporary” lockdowns related to the country’s Zero Covid policy continues to drag down the industry. As of 25 October there were 7,395 cinemas in operation, a decline of 109 from the day before. The operating rate was thus 59.70%, with 314,000 admissions, a decline of 16.86% from the same period the previous month. Box office stood at CNY 12.763 million (USD $1.76 million). This is the lowest level of cinema openings since mid-April, when less than 6,000 cinemas were in operation and cities such as Shanghai were in lockdown.
As a result of the closures and a lack of major tentpoles, whether local or Hollywood, box office in China fell to its lowest level since May of this year. In the week of 17-23 October the box office revenue for China was CNY 167 million (USD $23 million), representing a month-on-month decrease of 28.32% and setting a new low for a single-week box office since the end of May.
Source: Sina
Miscellaneous
Italy to Spend €10 Million to Bring People Back to the Cinema
The new right-wing Italian government has pledged to spend EUR €10 million to entice audiences back to cinemas. The announcement was made by the new Minister of Culture, Gennaro Sangiuliano, who stated that “The crisis of the cinema will be at the center of my work.” The money will come from Italy’s National Recovery and Resilience Plan (PNRR). Italy has seen a lower cinema attendance than any other major European cinema market since the start of the Covid-19 pandemic.
The new government will offer a cinema ticket subsidy of €3.4 per person via the government ID app called Spid. While the EUR €10 million is more than other European governments (with the exception of France) have put forward to help cinema recovery, it is still “a drop in the ocean to bring people back to auditoriums,” the minister acknowledged. But he said that great initiatives start small.
We have the money from the PNRR, to spend well, honestly and efficiently. We are the first cultural superpower on the planet. In Italy, in my opinion, the Minister of Culture counts a lot because culture, if used well, made attractive, usable, can be a factor in increasing various points of GDP.
Unlike cinemas, Sangiuliano ruled out providing any subsidies for Italian museums, though he plans to create a new Shoah (Holocaust) museum in Rome.
Source: La Stampa
Cinemas
First Japanese Cinema with FLEXOUND Augmented Audio Opens
FLEXOUND Augmented Audio from Finland will open this December in 10 auditoriums of United Cinemas theatre in Odaiba, Japan. The first film to be shown with the technology will be “Avatar: The Way of Water.”
FLEXOUND Augmented Audio provides personal immersive audio and natural vibration. The augmented audio technology enhances the cinema sound experience with high-quality personal sound and physical vibration in each individual seat. This creates an immersive effect, including the vibration and clarity of sound, are especially welcome for people with hearing impairments.
Flexound has been in close collaboration with United Cinemas on multiple cinema projects in Japan, including FLEXOUND Pulse cinema sound, the world’s first fully loudspeaker-free cinema concept.
Source: Celluloid Junkie
Cinemas
BFI Upgrades Flagship Screening Room with Christie Technology
Christie announced that the British Film Institute (BFI), the UK’s leading organisation for the moving image and the owner of the world’s largest film and television archive, has installed Real|Laser illumination technology in its main screening room, NFT1, at its flagship venue BFI Southbank. Following a trial period at the BFI London Film Festival, a new CP4420-RGB pure laser projector.
Christie has a longstanding relationship with the BFI. The previous Christie projector installed in NFT1 had been in-situ for an impressive 14 years. The new CP4420-RGB 20,000 lumen projector has a wide gamut for color fidelity and is future-proofed with high frame rate capability (4K 120fps or 4K 60fps/eye 3D playback). On the operational side, the projector is designed with a very long-lasting light source – more than 50,000 hours of stable DCI-specified brightness.
The refurbishment of NFT1 also updated the audio system to Christie Vive Audio, which includes five LA3i line arrays and five S215 subwoofers for the screen channels, two S218LP subwoofers and LA3Si surround loudspeakers
Source: Celluloid Junkie
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