It was just a few weeks ago that the AMC Theatres chain said that it would no longer run movies from Universal Pictures because of the latter's stated desire to shorten the 90-day window between theatrical releases and their availability for at-home viewing, which AMC saw as an existential threat to its increasingly tenuous business model.
That all changed yesterday.
Here's how Variety reports the story:
"Universal Pictures and AMC Theatres have put aside a bitter feud and signed a multi-year agreement that will allow the studio’s films to premiere on premium video on-demand within three weeks of their theatrical debuts.
"The pact, sure to send shockwaves throughout the exhibition industry, has the potential to reshape the ways that movies are marketed and distributed. Rival studios are likely to begin pushing for exhibitors to grant them more flexibility when it comes to determining when and how their theatrical releases can make their way onto home entertainment platforms.
"Financial terms of the agreement were not disclosed. However, in a statement, AMC’s CEO Adam Aron said the company will 'share in these new revenue streams,' which means that it will get a cut of any money made on these digital rentals. Universal only has the ability to put its movies on premium on-demand, meaning the rentals that go for roughly $20 a pop. It cannot sell films or rent them for lower on-demand fees, in the $3 to $6 range, until three months after they debut in cinemas."
There also seems to be flexibility in the system - if a movie performs well in theaters, then the at-home date can be delayed.
- KC's View:
What I think is impressive about this deal is the same thing that makes it relevant to retailers - the willingness, admittedly driven by extraordinary pandemic-induced challenges to their business models, to find a new way forward that is consumer-centric.
The fact is that there are a lot of movies that don't need to be in theaters, and certainly don't need 90-day exclusivity. By finding a way to work together rather than battling for supremacy, both sides have figured out that adhering to old ways of doing business simply did not make sense, especially because those old ways were at odds with what consumers seem to want from the entertainment experience.
These are the kinds of realizations that every business has to come to - the old ways sometimes have value and represent values, but they also sometimes just have dust on them that deserves to be blown away.