Split between studios & movie theaters intensifies
Warner Bros. and Universal Pictures are negotiating a deal with Apple and Comcast to offer audiences digital versions of movies two weeks after their theatre releases, Bloomberg reports. The theater chain and studio businesses have been unable to reach a deal that would let studios distribute more expensive ($30+) digital movies to viewers at home shortly after their release in theaters.
Data: PricewaterhouseCoopers; Chart: Lazaro Gamio / Axios
Why it matters: Studios were hoping to work with the theaters chains on a revenue deal, but now seem to be charging ahead without their blessing, despite the fact that theaters still hold power distributing movies and driving revenue. Noticeably missing from the reported negotiations is Disney, which announced it would build its own entertainment streaming package in 2019.
Bottom line: The movie business is changing quickly and its becoming more reliant on digital distribution than ever (shocking). Cinema revenues are rising, but are being outpaced by digital video rentals and the DVD business is dying, as expected. "Theaters have to focus on providing an experience that goes well beyond what's available at home — hence all the focus on luxury seating, 4DX, live event programming, VR, and better food and beverage options," says Chris Vollmer, Global Advisory Leader, Entertainment and Media at PwC.