Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Photo: Noam Galai / Contributor

Universal and AMC, the largest theater chain in the U.S., struck an unprecedented multi-year deal on Tuesday to allow Universal films to appear on premium video on-demand services after being made available in theaters for 17 days — a significant departure from the traditional 90-day theatrical window.

Why it matters: The move represents a major step toward shifting movie consumption habits from theaters into homes, even after the coronavirus pandemic subsides. It also signals a new era for the struggling movie theater business, which has faced near-collapse during the outbreak.

Details: Deal terms weren't disclosed, but in a statement, AMC CEO Adam Aron says the agreement includes his company sharing revenue from the movies that air on-demand with Universal.

  • AMC could take a 10% cut of each video sold by the studio to viewers on-demand, sources tell the Hollywood Reporter.
  • Recently, movies that have skipped the theatrical window during the coronavirus have sold on-demand for $19.99 to rent for 48 hours.
  • The agreement preserves the exclusive theatrical window for at least the first three weekends of a film’s release (17 days), which is when the majority of a film's revenue is generated, per AMC.
  • It also includes a traditional distribution agreement, wherein AMC has agreed to distribute Universal films in its theaters for years to come.
  • "[I]n total, Universal and AMC each believe this will expand the market and benefit us all," Aron said.

The big picture: Other studios will eventually want to get the same treatment as Universal, which means this deal is likely to trigger a set of arrangements between other studios and exhibitors. Those agreements, made possible due to the pandemic, will redefine the relationship between the theater industry and Hollywood studios long-term.

Be smart: The announcement comes as even more of a shock given how bitter the feud between AMC and Universal was at the start of the pandemic.

  • Universal was the first studio to skip the theatrical window altogether amid the pandemic, when it put "Trolls World Tour," among other titles, on-demand for 48-hour rental at the same time as the film debuted in theaters this April.
  • The movie's success — netting $100 million in three weeks from North American on-demand sales — inspired other movie studios to follow for other films.
  • The trend has provoked the theater industry, which remains mostly closed. In April, AMC lashed out against Universal over the threat of more movies skipping their theatrical releases during the pandemic.
  • AMC already signaled to investors that it may not survive the pandemic, adding in a recent government filing that "substantial doubt exists about our ability to continue as a going concern for a reasonable period of time."

The bottom line: Theater chains have been adamant that releasing movies on-demand at the same time they debut in theaters cannot become the new normal once the COVID-19 pandemic is over. But their years-long resistance to the idea is facing pressure as theaters remain shuttered due to social distancing guidelines.

Go deeper

Oct 12, 2020 - Economy & Business

Disney reorganizes media, entertainment business around streaming

Photo: Disney

Disney shares were up nearly 5% in after-hours trading Monday after the entertainment giant announced it would be shifting its entertainment strategy to have streaming be its "primary focus."

Why it matters: The company is facing investor pressure to invest more in streaming, its strongest-performing sector. Its other business lines, like movies, parks and cable, are being heavily impacted by the pandemic.

Bryan Walsh, author of Future
18 mins ago - Politics & Policy

The global future is looking dark and stormy

Illustration: Rae Cook/Axios

A new 20-year-forecast for the world: increasingly fragmented and turbulent.

The big picture: A major report put out this week by the National Intelligence Council reflects a present rocked by the COVID-19 pandemic. How the next two decades will unfold depends largely on whether new technologies will ultimately unite us — or continue to divide us.

10 hours ago - Politics & Policy

Rep. Gaetz declares he's "not going anywhere" amid sex trafficking probe

Rep. Matt Gaetz. Photo: Eva Marie Uzcategui/Bloomberg via Getty Images

Rep. Matt Gaetz (R-Fla.) doubled down Friday night, saying he's not "going anywhere," and vowing, "I have not yet begun to fight," amid a federal investigation into sex trafficking allegations.

What he's saying: “I’m built for the battle, and I’m not going anywhere,” Gaetz, who denies the allegations, said during a Women for America First event at the Trump National Doral Miami resort.