A historic agreement risks definitively transforming the distribution model of theatrical releases on streaming platforms.
The films in streaming after only 17 days from the release in theaters? What may have seemed a pure utopia a few months ago is now a reality. The American cinema chain AMC has in fact signed a historic agreement with Universal that will forever change the way films are released in the United States, giving a decisive shock to the entire cinematic world of the post-Coronavirus and probably bringing new distribution models of films within the main streaming platforms.
For now, the agreement will be limited to US territory only, but the two parties involved and their importance could bring it all to a global level.
A historic agreement
The agreement involves AMC Theaters – multinational in the cinema sector, with the largest chain of cinemas in the world which also includes the affiliates Odeon and UCI – and the major film company Universal. The company’s films will have the opportunity to remain at the cinema exclusively for three weeks, and then land on the main online rental platforms on demand. Subscribers of various iTunes, Chili, Rakuten and Amazon will be able to rent their favorite movie exactly 17 days after its release in theaters and for the price of 20 dollars, which will remain blocked for the first 90 days, only to then gradually reduce to the minimum price of 3 dollars, at which time the films will also land on traditional streaming services. In fact, the agreement will only involve on-demand and pay-per-view services and will try to give new life to “second tier” films, which have screenings in theaters for a few weeks and which, thanks to on demand, could be kissed by a greater success.
All this, according to the parties involved, without taking away any income from the theater: if the film is successful, its stay in the theater will be extended, while the $ 20 rental ticket – just over the cost of a normal ticket in a multiplex in New York – would be equally divided between the major and the film chains.
War and peace
The agreement is a direct consequence of a peace finally found between the two parties involved, who had had significant disagreements during the Coronavirus lockdown period. The closure of the theaters had led to considerable controversy, with closed cinemas and the majors looking for new distribution methods to stem losses. The clash between AMC and Universal came after the film house’s decision to distribute a flagship film such as “Trolls World Tour“directly on on-demand platforms. The decision, which was followed by the arrival on demand of other cinematic releases, raised a fuss of no small importance, with AMC on a war footing for a choice that, according to AMC, would have created not a little damage to the entire film industry.
The strategy, on the other hand, turned out to be very successful, welcomed by the public for a model that is also valid in the long term, even more so with a pandemic that sadly continues to run its course. Hence the desire for both parties to iron out the differences and make the model a fact and a sustainable reality for both theaters and studios.
The Coronavirus has brought to light and shown the world a problem of no small importance and a business model that is no longer sustainable in the long term, with the audience less and less used to going to the cinema and the salt circuit increasingly in economic difficulties. The spread of streaming and the public’s habit of using the network to enjoy their films has led the actors involved in the search for a synergy of intent that was impossible until recently.
A few and well-selected leading products move the public towards the cinema: “second tier” films have long been sacrificed in a world of releases that includes few high-level products and many fillers that pass too soon into second place plan. Reduce the distance between the exit in the halls and that in the platforms it could guarantee much more life to these films and much more income for everyone, with a sharing of income and intentions which, according to the premises, could bring not a few improvements to the entire circuit.
For now, the agreement will be limited only to the US system and only to Universal films, but the weight of the two parties involved could soon lead to a domino effect that will enlarge the model like wildfire, even more so if this, as is think, it will prove successful. It is impossible for the other big movie houses to stand by and watch, with agreements that could cascade down and follow this system which, as always happens, in a short time would become not only an American but also a global affair.
This agreement has finally brought to light a long latent and now evident awareness. The coronavirus and the closed theaters have made it clear to the actors involved that for a good slice of the public the difference between cinema and television, for the viewing of some films, does not exist.
For this the two distribution methods must coexist and collaborate, also becoming one on a concrete level. Those who want to go to the cinema can continue to do so but everyone else will be aware that, at more or less the same price, they will be able to see a film on demand after only 17 days.
All this, of course, will lead to quite a few changes for the platforms that, in some way, will become more and more central to the cinema offer. This will lead to a greater centrality of these services, with ad hoc events and new advertising strategies also for the release of films in streaming, with platforms that will perhaps try to grab the temporary exclusivity of some films to attract more high possible number of subscribers.
A godsend for all the already established services and new business opportunities for all the others. Amazon has long sniffed out the deal and in its Prime Video there is already a section with films to buy on demand.
If everything turns out to be successful, could others also open up to this new distribution world? Let’s think of a section of Netflix specifically designed for on demand, perhaps with discounts for subscribers, for example. In the meantime, Disney + has already proved far-sighted, moving probably bankrupt productions to the theaters, such as Artemis Fowl, directly in streaming, or launching, at a higher price, heavyweight titles like Mulan, which will also arrive however cinema. Even with a relatively high purchase price, savings for many families could be net and much cheaper than, for example, a movie night for a husband, wife and two children. The cards in order to have a winning product in your hands are all there, with the world of streaming at the gates of a new revolution, no longer as a harmful substitute for the world of cinema but as a synergistic continuation of the life cycle of a film. The hope is that all this really gives new life blood to the rooms themselves and new variety within streaming and on demand platforms.