The nation's largest movie-theater chain isn't signing on to
Paramount Pictures' plan to shorten the length of time it takes for
a movie to become available to watch at home.
Regal Entertainment Group told investors on an earnings call
Thursday that it wanted to stick with the "traditional distribution
model" that the studio is trying to shorten with help from other
exhibitors.
Earlier this month, the Viacom Inc.-owned studio struck a deal
with AMC Entertainment Holdings Inc. and Canada's Cineplex Inc.
that allows the studio to digitally release two coming features
about two weeks after their screen count falls to 300 locations. It
is the kind of partnership that was long considered a lost cause in
Hollywood, as exhibitors have held fast to a traditional
exclusivity "window" of 90 days, regardless of how many screens a
movie is playing on in theater chains.
Regal operates more than 7,300 screens. Its closest competitor,
AMC, has about 5,000.
Paramount's plan gives participating exhibitors a portion of the
digital revenue on the two movies out this October— "Paranormal
Activity: The Ghost Dimension" and "Scout's Guide to the Zombie
Apocalypse." Since the initial announcement, five smaller
exhibitors have signed on. Participating theaters at this point
represent about 30% of the exhibition market.
If the Paramount plan works, other studios could start
requesting similar arrangements with theaters, meaning moviegoers
would be able to watch most movies at home weeks earlier than they
do now. DVD retailers and pay-TV channels would also move up their
release schedules.
Studios have long tried to shorten the length of time they must
wait before a digital or home-video release, saying it can deprive
audiences of legal ways to view a movie before its digital release
and forces them to re-market a film. But theater operators have
long feared that any modification to the 90-day window will lead to
consumers forgoing the theater altogether and watching movies at
home.
"The parameters of the current proposal, both economic and
structural, simply do not make sense for us given the potential
risks to the long term health of our business," said Regal CEO Amy
Miles. Two other major exhibitors—Cinemark Holdings Inc. and
Carmike Cinemas Inc.—have yet to decide whether they are
participating.
Paramount is moving forward with its plan regardless of who else
signs on, said studio Vice Chairman Rob Moore. "We didn't expect
everyone to be part of it, but we're confident that a lot of others
will ultimately join in," he said.
Write to Erich Schwartzel at erich.schwartzel@wsj.com
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