The nation’s beleaguered movie theaters, shuttered in March by the novel coronavirus, are understandably eager to reopen once the pandemic subsides. After weeks of almost no revenue, there’s rising hope that bricks-and-mortar cinemas, a cornerstone of the film business, will begin returning by mid-June.
But the reality is much more complicated. No one knows when public health guidelines will allow multiplexes to reopen. And when they do, it’s unclear when people will feel safe going into a darkened auditorium with a crowd of strangers.
Rich Millard, a 37-year-old father of two in Rancho Palos Verdes, fondly remembers taking his 7-year-old son to see “Sonic the Hedgehog” earlier this year. The video engineer, whose work also was shut down due to the coronavirus, hopes theaters can return soon but doesn’t see himself rushing back to the cinema.
“I’d be willing to go out just with me and my wife maybe a month after they reopen,” he said. “We’ll wait even longer before the kids go back.”
Lingering concerns among patrons are a major reason why the return of the movie business will be a long slog. Filmgoing in the U.S. — which generates about $15 billion in ticket and concession sales a year and employs 150,000 people — probably won’t fully recover for 18 months to two years, analysts said. Before a vaccine and reliable immunity testing are widely available, a return to prior strength seems unlikely.
Meanwhile, the closures are expected to have lasting effects on the more than century-old movie theater business. Some small, struggling chains probably will go out of business. Large operators may be forced to unload locations. AMC, the country’s largest circuit, has raised $500 million in private debt to stay afloat, adding to its substantial leverage.
“There will be a culling of the herd, somewhat,” said Eric Wold, an analyst at B. Riley FBR who follows the major theater owners.
Officials in some states have already started reopening their economies. Georgia’s Republican Gov. Brian Kemp said theaters could resume business on April 27, though AMC, Regal and Cinemark chains stayed closed. Texas Gov. Greg Abbott declared movie theaters could open with 25% capacity on May 1. But in California, Gov. Gavin Newsom said Tuesday it would be “months, not weeks” before theaters reopen.
Many people will be hungry for entertainment options after weeks of being sequestered at home. But the major theater chains have resisted the urge to reopen, even in states that are easing restrictions, because of the potential resurgence of the virus and liabilities if moviegoers get sick.
Most cinemas couldn’t open right away even if they wanted to. They will not only have to rehire workers but also train them in strict social distancing and sanitary standards. Auditoriums will probably have to be thoroughly cleaned between screenings, which could cut down the number of showtimes.
Multiplexes will need to block out seats to create enough space between patrons, making every other row available or eliminating chairs in a checkerboard pattern on their advance sales webpages. Some have considered temperature checks for moviegoers.
For most operators, it’s far too early to make firm decisions about how to proceed.
“It will be a methodical, gradual return,” said Ted Mundorff, president of Los Angeles-based ArcLight Cinemas. “Folks will come back, we just have to see how quickly.”
Adding to the uncertainty is a lack of new movies available to theaters, as studios continue to push back their major releases.
Even if theaters in the South and Midwest open early, studios won’t release their big films until the largest domestic markets, L.A. and New York, are back in business. For now, the next potential blockbuster on the schedule is Warner Bros.’ Christopher Nolan film “Tenet,” set for July 17, followed by Walt Disney Studios’ “Mulan” (July 24).
“Theaters opening now, I think, is a bit silly,” said Eric Handler, an analyst with MKM Partners. “There’s no content to show, and people are going to be nervous about congregating.”
There will be a culling of the herd, somewhat.
Indeed, the National Assn. of Theatre Owners, the Washington-based lobbying arm of the exhibition business, on April 23 said, “Many theaters will not be able to feasibly open,” despite the easing of restrictions in some states. Leawood, Kan.-based AMC said it would only be wise to open “directly in advance of the release of major new movie titles.”
Exhibitors and studios are exploring ways to get nervous customers back in the habit of going to theaters again, such as special repertory screening programs and marketing initiatives. Distributors, for example, have courted actors and filmmakers to participate in “welcome back” PSAs for theater openings. Some theaters may offer weekday discounts for people more comfortable going to the movies on less busy days.
“There’s a lot of think-tanking going on,” said Chris Aronson, president of domestic distribution at Paramount Pictures. “As long as the exhibitors convey the fact that there’s a clean and safe environment, people will want to come back. The thing that is of paramount importance is to get the business back up and running.”
During the first couple of weeks, cinemas will focus on playing feel-good movies, like animated films, family classics and lighter action flicks (think the “Fast & Furious” and “Harry Potter” franchises).
Not on the lineup for most: horror films and dark thrillers that could stoke customer anxieties. And definitely not “Contagion,” the 2011 Steven Soderbergh movie that has been a top iTunes download during the public health crisis. The few exhibitors who requested it from Warner Bros. were turned down, according to a person familiar with the matter. A Warner Bros. spokesperson denied that the studio turned down theaters.
Liberty, Mo.-based B&B Theatres, which operates 50 cinemas, hopes to open with oldies including “The Goonies” and “Groundhog Day,” as well as a “Grease” sing-along. B&B Theatres, which employed 1,400 people before it shut down, plans to reopen its two drive-in locations on May 15, before the rest of its circuit, to get people back in the moviegoing habit.
“We‘re not going to show ‘Saw,’” said B&B executive vice president Brock Bagby. “We’re trying to bring people joyful stuff. ‘Groundhog Day’ is perfect right now, because people feel like they’re living in ‘Groundhog Day.’”
Fathom Events, a Centennial, Colo., company that organizes screenings of opera and classic films, is coordinating a “30-day comeback” series for cinemas. The screenings will be organized by genre for each day of the week, such as anime, faith-based film and “girls night out” movies, said Fathom CEO Ray Nutt. “The No. 1 objective is getting people back into theaters and showing them that it’s safe,” Nutt said.
New York-based distributor IFC hopes to help indie movie houses by making 200 older titles, such as “Boyhood,” “Y Tu Mama Tambien” and “Frances Ha,” available to theaters for free.
When people have the confidence to go out in groups again, there is going to be a tremendous hunger for people to go out.
Some studios are trying to help struggling theaters by allowing them to make movies available to rent through their websites. “Parasite” distributor Neon is releasing the documentary “Spaceship Earth” May 8 through a “virtual cinema” initiative intended to provide revenue for theaters, as well as struggling restaurants as bookstores. It also will be available through iTunes, Hulu and other digital platforms.
“We have to keep bringing new films to audiences,” said Neon CEO Tom Quinn. “I have no intention of sitting on the sidelines and hibernating.”
Some industry insiders worry that virus-related shutdowns could accelerate a long-term threat to cinemas: the collapse of the traditional theatrical window (the average 90-day gap between a movie’s release in theaters and home video).
On April 10, Universal Pictures released “Trolls World Tour” for a $20 digital rental amid the theater closures, declaring record-breaking sales results. The film generated nearly $100 million in sales in three weeks. Warner Bros. followed suit, saying its new animated Scooby-Doo movie “Scoob” will be available for rent and purchase May 15. Disney’s “Artemis Fowl” is going straight to streaming on Disney+ in June.
But the push toward online releases could undermine the exhibition business, causing fewer movies to be released theatrically.
The reaction has been fierce. AMC on Tuesday said it would ban Universal movies after NBCUniversal CEO Jeff Shell said the “Trolls” sales “demonstrated the viability” of premium video on demand, adding, “As soon as theaters reopen, we expect to release movies on both formats.” Universal said its comments were misinterpreted.
Sony Pictures motion picture group chairman Tom Rothman rejected the idea that the future is moving to online premieres. The vast majority of major studio movies have been given later release dates, rather than going straight to video-on-demand or streaming, he said.
“There is no economic model — it doesn’t exist — to recover the size of the investment in a big theatrical movie without theatrical revenue,” Rothman said. “When people have the confidence to go out in groups again, there is going to be a tremendous hunger for people to go out.”
The backlog of delayed movies, though, will create its own challenges as studios try to shuffle their release schedules without cannibalizing one another. Multiple highly anticipated movies, such as Disney’s “Thor: Love and Thunder,” have been pushed back into 2022. Sony’s upcoming “Venom” sequel was delayed until June 2021 to take over the vacated slot of Warner Bros.’ “The Batman.”
“It’s basically three pounds of sand that have to go into a one-pound bag,” Rothman said. “What you have is dozens of big movies that are absolutely going to go theatrical.”
Industry advocates say that people will eventually return to cinemas in large numbers.
Still, even the staunchest proponents of the theatrical experience, such as former Imax executive Greg Foster, stress the need to follow the lead of public health officials.
“I’ve literally dreamt about being back in a movie theater, and I’m excited to return when audiences are comfortable and excited as well,” said Foster, who works as a consultant for Apple and South Korean entertainment giant CJ. “I have the utmost confidence that the reopening of multiplexes will be well thought out and done the best and safest way. When they’re ready for us, I’ll be the first one in line.”