News that two major movie studios intend to release films next year straight to streaming saw shares in the cinema chain Kinepolis drop by 15.% overnight.
Yesterday Warner Brother announced it would release 17 films next year in cinemas and simultaneously on the streaming service HBO Max, which has nine million subscribers.
WB ‘s planned 2021 releases include Godzilla vs Kong, Mortal Kombat and the latest in the Matrix franchise.
The news follows an announcement by Disney that it would release the new live-action Mulan and Soul (an animation voiced by Jamie Foxx, Tina Fey and Graham Norton) on its Disney+ service, and skip the cinema stage altogether. And industry news is that MGM is looking for a streaming outlet for the new Bond film.
The developments will affect cinemas whether the studios release their films there or not. At present, cinemas are allowed a period of about two months during which new films are not available anywhere else. That pulls the audiences for blockbuster films into the cinemas when impatience and fashion see to it that audiences are reluctant to wait for other releases, to TV for example, specialist movie channels or DVD.
If, however, films are available for streaming immediately, that is likely to hit cinema sales hard. As if things weren’t already bad enough.
Since March, cinemas in Belgium as elsewhere have spent a lot of time in the dark, while the tendency in recent years towards multiplexes has left them with giant movie warehouses with no customers.
News of the WB announcement saw Kinepolis shares fall by 15% on Euronext, recovering only slightly to stand down about 10% this morning.
Kinepolis CEO Eddy Duquenne is not panicking, he told De Tijd. Both WB and Disney have said their move is a one-off reaction to the closure of cinemas worldwide.
“The studios are still postponing film releases, and they are not giving up the lucrative cinema income,” he said. Kinepolis hands over half of your ticket price to the studio, while making the majority of its income from the concession stands.
“In the entire life cycle of a film (cinema, streaming, DVD, TV), Hollywood generates the largest share of its income in the cinemas.”
With the closure of the cinemas, Hollywood is also losing income, by that calculation, and needs to look for alternative markets. At the same time streaming services are springing up like mushrooms, and fighting for market share. The sums they are offering studios for simultaneous release are likely to be be higher now than they would be in a normal market, or can be expected to be later once the less successful players drop out of the game.
And Duquenne has new ideas up his sleeve, too. Such as the cinema showing of TV series from the likes of Netflix.
“During a guest lecture at Ghent University I asked 266 students whether they would watch a TV series in the cinema,” he said. “59% said they would.”