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Amid coronavirus theater closures, Sean Parker’s controversial Screening Room returns, sort of

Sean Parker
Sean Parker arrives at the fifth annual Sean Penn & Friends Help Haiti Home gala in January at the Montage Hotel in Beverly Hills.
(Michael Tran / FilmMagic)

Sean Parker’s controversial video-on-demand startup Screening Room, which roiled the film industry four years ago when it first emerged, is staging a comeback amid widespread disruption in Hollywood due to the coronavirus outbreak.

The Napster cofounder made waves in 2016 with the Screening Room, which was proposed as a service that would charge users $50 to watch movies at home while the films are still in theaters. The service never launched and eventually faded from view.

On Monday, the nascent company rebranded as SR Labs, named a new chief executive and announced $27.5 million in new capital. Man Jit Singh, former president of Sony Pictures Home Entertainment, will lead the company as CEO, while previous chief Prem Akkaraju will assume the role of executive chairman, SR Labs said. Akkaraju and Parker cofounded the Screening Room.

Details about the company’s plans are vague. Originally, Screening Room attracted interest from directors including Peter Jackson and Ron Howard, and industry leaders such as AMC Theatres CEO Adam Aron, for its plan to share video-on-demand revenue with exhibitors. Users would stream the films from a secure set-top box attached to their TVs.

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The idea angered many theater owners, who saw it as a threat to their traditional business model. The average studio movie waits about 90 days between its theatrical release and its home video premiere. Theaters worry any move to undercut that window will destroy their business.

However, the company’s business model has shifted. Descriptions in the firm’s news release called SR Labs a “developer of next-generation software and hardware technology for secure video delivery.” The company will provide its technology platform to studios and exhibitors, who will decide how they want movies released.

Buried deep inside the postproduction facilities on the 20th Century Fox lot, beyond where executives decide how best to sharpen Wolverine’s claw and make Alvin sound like a chipmunk, sits a space with a more mysterious purpose.

SR Labs said it has been issued 11 domestic and 25 global utility patents related to its technology. The company touted its digital film delivery tech, emphasizing its antipiracy protections and security.

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“We at SR Labs are committed to achieving one goal: providing both studios and exhibitors the tools and technologies they need to future-proof and expand their businesses,” said Parker, who came to prominence as the cofounder of Napster, the file-sharing site that was shut down over piracy. He also was a key investor in Facebook and Spotify.

The return of the Screening Room as SR Labs comes as theaters face an existential threat from the spread of the coronavirus.

Analysts say AMC Theatres likely will file for Chapter 11 bankruptcy protection if theater closures persist as long as expected. Theater chains have furloughed or laid off tens of thousands of workers, most of whom are part-time and hourly.

Studios have already started offering early rentals of their theatrical movies as consumers remain stuck at home.

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Universal Pictures on Monday said its DreamWorks Animation sequel “Trolls World Tour” was the biggest digital release ever but did not disclose sales figures for the movie, which viewers can watch on iTunes or Amazon for $20. Walt Disney Co. is skipping theaters for “Artemis Fowl” and will release it directly to its streaming service Disney+.


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