Movie theaters turn to live event screenings to fill seats
It’s 7 p.m. on a recent Saturday and every seat in the 294-seat theater inside the AMC 16 Burbank is filled. The crowd isn’t there to watch “How to Train Your Dragon” or “Alice in Wonderland,” but a not-so-family-friendly kind of entertainment: mixed martial arts.
Tonight’s feature is a highly anticipated Ultimate Fighting Championship face-off between Brazilian jiujitsu black belt Georges St. Pierre from Montreal and cocky English fighter Dan “The Outlaw” Hardy. When the action starts and St. Pierre scores his first “takedown,” fans leap from their seats, pump their fists in the air and whoop wildly.
The event, beamed live to the Burbank theater and other venues around the country from the Prudential Center in Newark, N.J., is the latest example of how theater owners are harnessing the latest digital technology to program alternative entertainment such as broadcasts of the Metropolitan Opera and live concerts from the likes of the Black Eyed Peas, whose March 30 show at Staples Center was transmitted live to 500 movie theaters.
“Traditionally, the exhibition business was one-flavor-fits-all, and that flavor was movies,” said Gerry Lopez, chief executive of AMC, the nation’s second-largest theater company. “Well, we’ve learned over the last couple of years that guests will indeed get off the couch and come see us for other kinds of entertainment. That’s opened up our eyes to the possibilities.”
Although not yet a big money maker for the major chains, theater operators are betting that it will be one day, and are booking more such events on slow weekday nights in hopes of coaxing consumers to leave their homes and pay $20 for a premium ticket.
Alan Stock, chief executive of Cinemark Holdings, the third-largest circuit, said he had been encouraged by the turnout for such events, especially the opera. More than 100,000 people showed up at Cinemark and other theaters in January to watch a live broadcast of the New York Metropolitan Opera’s production of “Carmen.”
“Movies will always be our bread and butter, but this brings in a different clientele and broadens the base of people we can bring into our theater,” Stock said.
The push toward showing live entertainment in movie houses has been accelerated by the development of a satellite network capable of transmitting live signals into theaters around the country and the rapid deployment of digital cinema. After a long delay, a group representing the nation’s three largest exhibitors recently secured financing to roll out digital theater systems that serve as the technical backbone for 3-D movies and event programming.
The popularity of 3-D, driven by James Cameron’s “Avatar,” is also adding a dimension to live entertainment. Mann Chinese 6 Theatre in Hollywood was among more than 100 theaters nationwide that recently carried live 3-D coverage from CBS of the Final Four of the NCAA men’s college basketball tournament.
“Exhibitors are starting to look hard at this now,” said James Marsh, an analyst with the investment firm Piper Jaffray. “Before this was cocktail party chatter, but nothing was happening. Now they’re crunching numbers.”
Theater operators work with two main publicly traded companies, National CineMedia of Centennial, Colo., and Morristown, N.J.-based Cinedigm Digital Cinema Corp., that acquire the rights to the content, market the events and distribute the entertainment in theaters via satellites. The companies split box office revenue with theaters, but most of the money is made by selling sponsorships and advertising featured in shows that precede the main event.
“We’re approaching some sort of tipping point,” said Kurt Hall, chief executive of NCM, which through its Fathom division feeds one event per week to 600 screens nationwide. “Content owners have started to look more seriously at our network just because of the scale.”
An eye-opening event for many theater operators was last year’s live 3-D broadcast of the BCS national college football championship game, which was shown in 80 theaters, selling out in 19 of them, and generated four times the per-screen revenue than any film that night, according to Cinedigm, which transmitted the event.
Some theaters generated additional income by selling catered food, beer and wine.
“It’s about turning these things into events and transforming movie theaters into entertainment centers more like arenas,” said Cinedigm Chief Executive Bud Mayo.
Still, there are hurdles. Box office revenue alone isn’t enough to cover costs, often requiring third-party sponsors to defray expenses. The San Francisco Opera discontinued theater screenings after concluding they were too costly. And securing rights from established sports leagues like the NBA and NHL also is difficult and expensive. Hence the focus on niche sports, like the UFC.
Ultimate fighting fan Steve Perez, 28, was a convert after watching the St. Pierre bout at the AMC mutiplex.
“It was a way cool,” the L.A. resident said. “I felt like I was there. It was a big vibe.”