Studios have more leverage over movie theaters because of the coronavirus pandemic than ever before. Even if the specialty chains or major companies survive an extended shutdown, Hollywood has no urgency to produce anything right now.
That means agents are looking at unread screenplays to find a jewel in the rough for when production restarts. Screenwriters are going back to their pitches for new ideas. Although some movie theaters can remain open because full restrictions aren’t in place, Regal and AMC still enforce a 50% capacity rule to protect patrons.
Communal escapism is how families got through the Great Depression. That experience is what we must all avoid today.
How Will the Movie Industry Change?
Studios decided to withdraw movies from their distribution windows because of low viewership numbers. Expected blockbusters in No Time to Die, Mulan, and A Quiet Place Part II are all on pause for several months in the hopes that societal movements will get back to normal by the end of the summer.
That means millions of dollars in advertising were potentially wasted because COVID-19 stopped people from going to the movie theaters.
Some movies are available on-demand immediately in the $15 to $20 range to help reduce the potential for losses. That option may become the new normal for consumers, which means the traditional movie theater may not have a marketplace.
Even if people do go back (and they likely will), new spatial restrictions mean most theaters will require new seating arrangements to keep people comfortable. That means fewer seats per screen, increasing the price needed to see a show for most consumers.
If you have a family of six, going to an evening show was already more than $70 in most locations before snacks, beverages, or dinner. Why spend that much when you can pay $20 to enjoy the film at home?
Some theaters could default on their rent. Bankruptcy is a real possibility, even if chains cut staff and compress shows to maximize attendance numbers.
The other side of that argument is that the studios need movie theaters to generate revenues. At-home viewing doesn’t pull the same numbers as those on the big screen. You might see companies like Disney work with the national chains on financing packages that can help to bring them back to life.
Streamers now have an advantage because of the coronavirus pandemic. Exclusive windows will likely drop from 90 days to 75, 60, or even less. We won’t know for sure what the new normal will be until the economy gets a chance to reboot.
For movie theaters, it might be too late already.