Posted on Thursday, March 10th, 2016 by Ethan Anderton
Back in April of 2011, some of Hollywood’s major movie studios were in talks with Time Warner Cable to offer movies at home on demand 30 days after they debuted in theaters. However, movie theater chains were not happy with that possibility, and the opportunity was never made available to the consumer. But that might change if a new start-up being backed by Napster and Facebook’s Sean Parker takes off.
The man who was played by Justin Timberlake in The Social Network is working on launching The Screening Room, which would offer major theatrical releases on demand at home the same day they hit the big screen. Find out more below.
We know how much movie theaters stick to keeping the 90-day window open between when a movie hits theaters and when it hits home video, but there are plenty of lower-profile releases that get released on VOD before they hit theaters or vice versa. The difference here is that this would allow some of the biggest blockbusters to be viewed from home instead of forcing audiences to flock to movie theaters. So why does Sean Parker think this concept is more appealing now? And how will it work?
First up, users would have to pay $150 for access to a set-top box that would receive and transmit theatrical movies at home. And then each movie viewed through the box would cost $50 per viewing, accessible within a 48-hour window after rental and allowed to be watched only once in that window. Sounds simple enough, but what’s to stop movie theater chains from being upset by this and choosing not to show any of the movies from studios who decide to make a deal with The Screening Room?
Well, Parker would offer them a significant percentage of the revenue, as much as $20 of the fee. Along with that, Screening Room would give away two free tickets to see the movie they just rented at the movie theater of their choice. This way there’s incentive for these consumers to still go to the theater and likely spend money on concessions, which is where movie theaters make most of their money anyway.
In addition, Variety adds distributors would also get a cut of the fee, reportedly about 20%, leaving The Screening Room with their own fee of 10%, along with the aforementioned set-top box cost. It sounds like everyone gets a pretty decent size piece of the pie, but will it be enough incentive to get interest from all parties?
As of now, Screening Room officials who have met with movie studios have said they are close to finalizing a deal with AMC Theatres to get involved in the startup. That could easily be a negotiating tactic, but if they’re as close to finalizing a deal as they say, that’s pretty important. With a deal to buy Carmike Cinemas waiting to be approved, AMC is on the verge of becoming the world’s largest theater chain. And if they’re willing to play ball, that could make this work.
As for the studios, Universal, 20th Century Fox and Sony Pictures have all expressed serious interest, but they’re still looking at the business plan and figuring out details with The Screening Room to figure out all the finer details. There are no deals in place or anything like that yet, but all the right parties seem to be having promising discussions.
However, apparently Disney has no interest in this startup, which makes sense. Why would they want to offer their movies, which are guaranteed to get people in movie theaters, to be viewed at home, potentially losing money on some of their biggest releases. This is especially true when this kind of technology only seems to be beneficial for bigger families. So sadly the header image we made won’t really be a possibility.
And that’s probably going to be the determining factor of the success of this product. Families have the most to gain from a device and service like this, what with the rising cost of movie tickets and the overpriced concessions. A family of five going to the movie theater could easily spend between $50 to $75 on tickets to first-run movies — and that’s before the expensive popcorn, pop and candy. Or that same household could spend $50 to watch a movie at home with as many people as they want, and they already have a kitchen full of food at their disposal without having to truck the kids out to the theater, take them to the bathroom, risk missing part of the movie, and all that jazz.
Some people have criticized the appeal of this plan as being merely for people who are lazy. But it’s not lazy if you want to watch a movie with your grandfather who may want to see a new movie but isn’t physically able to leave the house and sit in a movie theater for a couple hours. It’s not lazy if a family has a handicapped child who can’t deal with crowded movie theaters or can’t make it to limited, special screenings where families with similar circumstance are encouraged to attend. There are plenty of people who would benefit from this and not just because they’re lazy.
At the end of the day, audiences will still flock to movie theaters for the ones that they really want to see on the big screen. And the $50 fee is high enough that it won’t always be appealing for a couple looking to see the latest awards contender. If there’s an opportunity for the distribution game to be changed slightly and made a little more convenient, this could be it.
The question is how many other theaters outside of AMC Theatres will be keen to make a deal with The Screening Room. Plenty of smaller chains stand to be hurt by this new service simply because they can’t afford to take a risk on a deal like this in the same way that AMC can. And with theater attendance being pretty flat in recent years, something like The Screening Room could end up being the nail in the coffin of some movie theaters.
The only way to see how something like this works is to try. The best example we’ve had so far is the release of The Interview in limited theaters and on VOD at the same time, but that was after some theaters opted not to show it following threats from North Korea. The circumstances were very unique, and the R-rated comedy was hardly an example of the most appealing film to test the impact a day and date VOD and theatrical release would actually have.
Anyway, it’s early days on The Screening Room for now, but we’ll keep you posted as the service takes more steps towards becoming a reality.Cool Posts From Around the Web: