https://www.nytimes.com/2019/10/14/business/media/amc-theaters-streaming.html
LOS ANGELES — In a sign of just how much streaming is changing
Hollywood, movie fans will soon be able to rent and buy films for
viewing at home — from a movie theater chain.
AMC Entertainment, the largest multiplex operator in the world, will
introduce an iTunes-style online video store in the United States on
Tuesday, said Adam Aron, AMC’s president and chief executive. The
service, AMC Theaters On Demand, will offer about 2,000 films for sale
or rent after their theatrical runs, just as iTunes, Amazon and other
video-on-demand retailers do.
The movie theater industry has long been at odds with online video. Why
trek to theaters if thousands of movies are available at the click of a
button at home or on your phone? Sure, new films do not arrive on V.O.D.
until they have played in theaters for an exclusive period of about 90
days. But that “windowing” practice, many analysts believe, will become
untenable as streaming services like Netflix gain clout.
Hollywood’s five biggest movie studios — Disney, Warner Bros.,
Universal, Sony and Paramount — have made deals with AMC for catalog and
new-release movies. Although DVDs still account for billions of dollars
in sales for studios, more profit now comes from digital downloads and
rentals.
“For us, it’s all upside,” said Ron Sanders, president of worldwide
distribution and home entertainment at Warner. “Most of our other big
digital partners are focused on multiple categories — music, books. The
great thing about AMC is that movies are the whole focus.”
Films will cost roughly $3 to $5.99 to rent and $9.99 to $19.99 to buy.
Mr. Aron, who took over AMC in early 2016 after running the Starwood
hotel chain, has been more willing to embrace change than many other
theater executives, in part because he is not blind to his industry’s
challenges. Moviegoing in North America — across the chains — has been
roughly flat for years, leaving theaters to scratch for growth by
charging more for tickets and concessions, a strategy that has its limits.
“Our theater business is mature,” Mr. Aron said. “There is a high-growth
opportunity in this digital expansion.”
He called home entertainment a “natural” extension of AMC’s core
business — one designed to capitalize on the chain’s fast-growing
customer loyalty program, AMC Stubs, which covers more than 20 million
households. He said the AMC Stubs database gave the company a marketing
advantage for movie rentals and downloads.
For instance, AMC Stubs members bought about six million tickets to “The
Lion King” over the summer. When “The Lion King” becomes available
digitally on Tuesday, “those people will all get a personalized message
from AMC saying that they can now enjoy it at home through AMC Theaters
On Demand,” said Elizabeth Frank, AMC’s chief content officer.
Some theater chains in other countries already operate on-demand
divisions (Cineplex in Canada is one), but AMC is the first major
exhibitor in the United States to do so. Mr. Aron said AMC had been
working on the service for more than two years. It was close to
introducing AMC Theaters On Demand this summer but held off to fine-tune
the technology and online store design.