They Will Survive?
The question on everyone's mind these days, aside from who's next up in the WarnerBrothers Discovery guillotine, is which theater chain will be next in the bankruptcy announcements. During last week's podcast, Tim and I discussed this a bit, and Sean McNulty had a great rundown on the financials of the chains in last Tuesday's Wake Up (Quick Summary: Imax and Cinemark: OK, AMC and Regal: Bad.) Financials and upcoming bankruptcies are crucial in the immediate term, but I think we have to start the conversation about the next phase of the theatrical experience and what it may look like a few years down the road.
First, as my co-host, Tim Thompson, pointed out, the mega-plex is dead. You all know what those are: the giant ugly square boxes usually plopped right in the middle of a mall with 15 screens. The seats are uncomfortable, and the sound system lacks quality. Most of my LA readers will probably only have a passing reference to what I'm referring to, given the numerous theaters in LA that are of decent quality, although those days are waning given the closure of Arclight and Landmark Theaters. So what does this mean? I think it means we are looking at a future when the theaters are smaller and more personable, which isn't necessarily bad. Costs will be less in smaller theaters, and they will be easier to maintain and staff. But what does that mean for the studios? Fewer screens mean less box office? Most likely, but that doesn't mean the studios don't have other potential revenue streams.
The Paramount Decree ended in the summer of 2020. The Decree was issued in 1948 and barred studios from owning any theaters forcing films to be sold individually. As that has ended, there doesn't seem to be much visibly happening, but as the inevitable bankrupcies approach, the studios will need to take a hard look at potentially getting back into the theater-owning game. Granted, Disney and Netflix have already started with each owing a few theaters around LA, but more experimentation is possible. The COVID lockdowns crushed a lot of independent theater owners, so I have a sneaking suspicion there may be a few theaters available for sale. Now is the time for some actual experimentation. Companies such as Comcast and Disney have a treasure trove of expertise to pull from, given their involvement with amusement parks, to try and reinvent the theatrical experience. Both companies pride themselves on creating phenomenal consumer experiences. Why not apply that experience to theaters?
Exhibitors and Distributors have played us vs. them for too long now. The time is ripe for some cooperation, and it is much needed. Even if some chains can avoid bankruptcy, the long-term prospects are grim. We need to see more things like this. The big streamers need to consider theatrical as an option to increase revenue. We have evidence with The Batman and Halloween Kills that day and date isn't always a killer. David Zalslav has committed to theatrical, but we have yet to see that plan implemented. Universal stands alone as the one major that seems to be putting any substantial effort into theatrical releases. The chains need product if they're going to survive, and the studios need to provide the product if they have any hope of long-term survival. It is possible, but we should begin before it becomes necessary for survival.
Mann Up
I had an interesting conversation the other day. Someone asked me if I ever got star-struck while working at Fox. I was never impressed by the prominent actors but only by the big-name directors. Seeing a visionary like Ridley Scott walking around impressed me more than a Tom Cruise. I've always thought that the prominent directors who reinvented the business were more interesting than the other more visible actors. Michael Mann has always been one of those directors to me. From Last of the Mohicans to Heat, he has an impressive resume (with a few bumps along the way.) Does anyone remember Blackhat? I still love the opening few minutes of Miami Vice, and I can't think of any director who made LA look so attractive as Mann did with Collateral.
While he has gone silent as of late on the film side, he had quite the week last week. As Deadline reported, he not only had a number one book on the NY Times Bestsellers list, Heat 2, but he also started production on the film, Ferrari, starring Adam Driver, Penelope Cruz, and Shailene Woodley. I hope this marks a return to form for Mann. I've heard he can be prickly to work with, but hopefully, that won't stop him from putting together a great movie. Maybe someone will option Heat 2 and get that sucker made pronto. You can't beat that gunfight in the original Heat—one of the best caught on film. Let's hope we get something just as memorable in Ferrari.
Pages from the Commonplace Book
This week, we're returning to the Founders in a slightly different direction than usual. I'm sure many of you have heard of The Federalist Papers. I'm also fairly certain that most of you haven't read any of them. They used to be required reading in secondary schools but haven't been required for some time now. I was a history major and didn't even have to read them in college. Luckily, I've re-discovered them, and they are a fountain of information on our constitution system: why it is structured the way it is and why it has endured for as long as it has. Reading them, I was struck by how many of the issues we face today were similar to what they were facing then. As I was reading through an analysis written by the incomparable historian William B. Allen in his book, The Federalist Papers: A Commentary. This section from Federalist No. 14 caught my eye:
"Hearken not to the unnatural voice which you tells you that the people of America, knit together as they are by so many chords of affection, can no longer live together as members of the same family; can no longer continue the mutual guardians of their mutual happiness, can no longer be fellow citizens of one great respectable and flourishing empire."
No doubt many of the hard-core folks on both the right and left would take issues with much of that statement, but something tells me that a vast majority of Americans would find much truth in it. We would be wise to heed it today as so much around us seeks to divide.
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