Friday, June 22, 2018

Cinema $10 unlimited month pass brings Netflix style to theatres

NoFilmSchool brought my attention to a HUGE landmark moment in the US - a Netflix-style $10/month pass for 'unlimited' cinema screenings.
NoFilmSchool article.

The MoviePass homepage.

That brings the disruption of digitisation to the a new level, and undermines (though it may take time yet for its impact through user numbers to grow) the traditional cinema exhibition business model: movie 'prints' (just as likely to be streams, Blu-Rays or HDDs now) are rented by cinemas from distributors and a further share of ticket revenue passed back to distributors. There is variation in this basic model depending mostly on the power of the distributor and whether its a tentpole big six production they're touting, but thats a rough outline of how the production (sell all rights to or agree a revenue share with a distributor) to distribution to exhibition film cycle ends up (before further distribution and exhibition through TV, and distribution through physical media, downloads and streams - rental and purchase.

If the audience figures are no longer a simple guide to box office, that suggests a steep medium to long term decline in revenues. Unless its the cinema-avoiding public (non-noisy nuisances, ie kids/teens!) that mostly takes up these passes. The 15-24 age range is the key cinema market as you can see from this BFI chart (page 4):


You can find a great analysis of the older audience in 2017 here, by Stephen Follows. This US analysis by Nielsen also shows roughly 30% of the cinema audience as 12-24, or nearly 50% for 12-34.

There is dispute over how big a revenue driver concessions (popcorn etc) really are, but this certainly will (in the style of bucket airlines like easyJet) shift the profit-making onus onto food and drinks - which distributors are locked out of. See this post for details on how vital the huge mark-ups cinemas make on concessions (typically 85% profit on every dollar spent) are.

The unlimited is limited: one viewing a day, no IMAX or 3D (maybe a supplement charge for longer movies?), but that still means a possible 30c viewing!

This isn't actually completely new ... many moons ago I bought Virgin Cinema monthly passes - £15 if I remember right, back in 1999. That enabled me to be amongst the shellshocked hordes stumbling out of the Phantom Menace midnight premiere wondering what the hell we'd just seen, and what kind of evil madman could invent JarJar Binks - but get over it by going to see plenty more decent movies in the days and weeks that followed.

I figured Curzon, with its membership scheme, would likely do something similar, and sure enough they also offer an unlimited annual pass for its cinemas.

Here in Luxembourg you can also get a monthly pass from the monopoly chain.

UPDATE: PREMIUM FOR HOT NEW FLICKS + AMC LAUNCH RIVAL
MoviePass are selling this as working with the industry to help push passholders to their quieter midweek slots: charging a $2 premium for some new releases, though often specifically for weekend screenings; they're also adding 3D/IMAX to their offering.
MacRumors reported:
Surge pricing is a dynamic, time-based strategy that apps like Uber use when a large amount of customers are requesting rides in the app but there aren't enough drivers to taxi them around. 
Now this will extend to MoviePass, so on opening weekends or at particularly busy late-night showings of popular movies, monthly subscribers should expect to pay a bit more above their locked-in $9.95/month subscription price. 
For IMAX and 3D movies, users will be given the option to pay an added fee for the premium screenings, ranging from $2-$6 according to Lowe.
The MoviePass news comes after AMC just yesterday revealed its own movie subscription service, which will let customers watch three movies per week for $19.95 a month -- including IMAX and RealD 3D showings. 
...

Popcorn is cinemas sweet spot not movies

This is a companion post to the analysis of the $10 MoviePass announcement, and what that (and other schemes I also discuss) means for the distribution and exhibition industries.

From a business point of view, cinemas are only partly about films. "When we bought [Odeon]," Guy Hands of private equity group Terra Firma famously said, "the management team really believed they were part of the film business. I had the difficult job of explaining to them that they were in the popcorn-selling business." (Oliver Thring, Guardian 2012)

With the emergence of NATIONAL movie passes, not just schemes within individual chains (Curzon and Kineopolis being being two examples), the revenue model of the film industry faces a huge shake-up with a disruption of the traditional models of renting 'prints' and passing some share of ticket revenues back to distributors (depending on the movie).

That hideous diabetes/clot-encouraging popcorn is set to become the main revenue stream for cinemas - movies could become a loss-leader, just as budget airlines seek to make money from flight 'extras' and in-flight sales more than the actual seat purchase - very bad news for distributors.

That process is arguably already here though...

The pic above is from a Guardian article on an American cinema-goer launching a doomed lawsuit against the US cinema chain for charging $8 for a coke. From the same article:

Sunday, June 17, 2018

FANDOM UGC Warners go Harry potty over fan fests

I'm struggling to see the logic behind this, there's no obvious loss of revenue and no apparent request for a licensing fee, just a blanket cease and desist legal order to fan fests that are huge promos for the Potter franchise.

Harry rotters: Warner Bros cracks down on Potter fan festivals in US https://www.theguardian.com/film/2018/jun/16/harry-potter-warner-bros-wizard-fan-festivals?CMP=Share_AndroidApp_Blogger

Sunday, June 03, 2018

MICROBUDGET DISTRIBUTION solo site takes no rights

NoBudge: a one-man passion project https://www.theguardian.com/film/2018/jun/03/kentucker-audley-nobudge-film-streaming-micro-budget?CMP=Share_AndroidApp_Blogger