11 minute read
Has the PVOD experiment failed? it’s hard to say for
The “premium” of cinema versus Premium VOD: Which tips the scale?
THERE ARE MANY IN the cinema world who would like to suggest that sitting in the dark with a bucket of popcorn and 100 other people is a sort of quasireligious experience. It isn’t. In fact, a lot of the time, a standard trip to the cinema can be disappointing.”
Before you start sharpening the pitchforks, those words belong to Tom Jarvis, founder of the Wilderness Agency, a London-based social marketing agency with clients including HBO, Warner Bros. and the world-leading food company Danone. As a committed cinephile, the central tenet of his argument (published last month in the marketing industry journal “The Drum”) was not “scrap cinema”, but rather “make cinema as good as it can possibly be”. In short, if your venue is really that great, and it genuinely is the hub of the community, reflecting the community’s needs, then viewers will flock to it. Sadly it isn’t the case that all cinema sites are the compelling destinations they should be. In a world of digital streaming immediacy, to many consumers, the continued existence of theatrical windows makes a poor out-of-home experience less appealing than a moderate in-home one. Especially in a world impacted by the unwelcome presence of a pandemic.
Stay at home? I’ve been there all year… The argument that films should be released on all channels at the same time has its advocates — “Give viewers the choice — and let cinema survive on its own merits,” say those waving the flag for content democratisation. In truth, they may also be harbouring a degree of resentment at popcorn prices. If the experience isn’t up to scratch, cinemagoers won’t rush to pay the out-of-home premium — they’ll watch the latest
Has the PVOD experiment failed? Some think so, but as CT’s Alastair Balmain explains, it’s hard to say for certain when the audience can’t enjoy the big screen experience they yearn for
release from their sofa, bypass the big screen entirely and eulogise about the savings. There is a “but…” here, of course. After six long months of economic lunacy, and combatting Coronavirus with hazard tape and hand gel, could the fundamental appeal of “Netflix and chill” or “Disney+… plus premium” be losing its shine for the stay-at-home majority?
Human beings are, by their nature, sociable, a point borne out by polling carried out by Omdia, the global technology research specialist in advance of Disney’s release of “Mulan” in September. In the week running up to the film’s release, the research powerhouse surveyed consumers in the US, the UK, Australia, Mexico and China to gain a better understanding of audience attitudes into theatrical and PVOD releases. The critical question audiences were asked? “Would you be comfortable going to the cinema to watch “Mulan” if it were released in your local cinema on 4 September?” Across all markets, a healthy 21% of respondents said yes, if available, they would be comfortable watching the film in the cinema in the first week of its release, with a further 25% saying they’d be happy to head to the cinema to watch it in the first month.
Read that last sentence again. At the height of a global pandemic, nearly half of the respondents said they would be comfortable heading to the cinema to watch a new release. Despite the masks and the social distancing. This compares with 17% across all markets that said they would be prepared to pay a premium to watch it at home (PVOD) and 18% who said that they were interested in watching “Mulan”, but weren’t keen to go to the cinema or to pay a one-off fee to watch at home. While it’s tempting to blame CV19 for everything, the indication in that final response is that one in five simply don’t recognise the value of a premium experience whether it’s at home or in a lavishly appointed auditorium.
$250m
“Tenet” passed $250m global box office, including a notably strong opening performance in the Japanese market
You can’t win them all over to the big screen, but in China and Mexico in particular, it seems you can win more of them. In those markets, a larger proportion of the audience said they would be comfortable seeing the title in a theatrical setting than elsewhere: 71.2% and 49.6% respectively said they’d be happy to head to the cinema in the first month to see Disney’s latest. Omdia’s research was specific to a title with a mixed release strategy — straight to PVOD in markets where the Disney+ platform exists, with a theatrical release in other markets where cinemas are, thankfully, open. Were the research to be conducted on a title such as MGM/Universal’s “No Time to Die”, which (at the time of going to press) is sticking determinedly to a theatrical release in November, the results would make for interesting reading. Arguably a tentpole Bond that has been heavily and slickly marketed for months might skew the audience’s “risk vs reward” sentiment significantly in favour of the theatrical experience. “Mr Bond, we’ve been expecting you…” has never felt more apposite.
Cinema owners don’t need any reminders that distributor confidence (or lack of it) in light of the release of “Tenet” has prompted a slew of big titles to be postponed. In the last week of September, “Tenet” passed $250m global box office, including a strong opening performance in markets such as Japan where it exceeded totals for Nolan’s previous films “Interstellar” and “Dunkirk”. It’s performance in the Domestic market, however, was lacklustre thanks to the closure of cinemas in the core California and East Coast states. So, a respectable performance if not a mega-money-maker — but with hand on heart, did the exhibition and distribution worlds genuinely expect a super crash-hot performance? For many
W O U L D W E B E C O M F O R T A B L E G O I N G T O T H E CINEMA RIGHT NOW?
% ACROSS SELECTED COUNTRIES
USA UK Australia Mexico China
71.2%
21% said that they would watch “Mulan” at the cinema in the first week of its release.
25% said that they would watch “Mulan” at the cinema in the first month of its release.
17% said they would pay a premium to watch “Mulan” at home (PVOD). 18% weren’t keen to go to the cinema or pay a fee to watch “Mulan” at home.
of those in Mexico said they’d be happy to head to the cinema in the first month to see Disney’s “Mulan”.
exhibitors, the opportunity to clean the porthole glass, switch on projectors and issue proof of life has been the biggest victory of this release. The real wish now is for follow-up movies and a return of distributor confidence — that, sadly,
“The Candyman” coming to a cinema near you soon…?
The delayed release of Universal’s “Candyman” is far from unique in the times of CV19, with nearly every significant film release originally scheduled past Q1 2020 having seen some form of date shift. Having originally been slated for an early summer opening, “Candyman” was subsequently delayed to September, then to October — and finally, in a clear admission that any attempt to set a firm date at the moment is a Sisyphean task, Universal announced the film will release in 2021, final date TBC. That’s a standard tale for current theatrical releases, however the film’s director, Nia DaCosta, headed to Twitter to explain the rationale for a prolonged delay — “We wanted the horror and humanity of “Candyman” to be experienced in a collective, a community, so we’re pushing “Candyman” to next year, to ensure that everyone can see the film, in theaters, and share in that experience.” Big up for the big screen experience. Should we read too much into the fact that the tweet — and indeed the director’s own Twitter account — were later deleted? Not really. The intent and desire for a widespread theatrical release are clear even if the final distribution strategy currently is not. Whether the film receives a traditional exclusive window, shorter theatrical release, day-and-date multi-platform release, or direct to a PVOD release, clearly the ambition was for a big screen scream-fest in the first instance, not simply to feed the streamers’ scrolling carousels.
appears to be sketchy at best. Titles such as “The King’s Man”, “Wonder Woman 1984”, “Candyman,” etc. have all pencilled in new dates several months later in the exhibition calendar.
So what of the opposition? Finding hard and fast data on the performance of subscription services is often a challenge, but in a “Pope has balcony” announcement, payments company Revolut and Bank of Ireland last month released interesting data about sign-ups for subscription services in lockdown. Analysis of customer transactions illustrated an average 36% increase in subscriptions to Netflix for each month between March and July. Not a huge a surprise for time-rich populations with diminished leisure options — and further evidence that the streaming habit is an established entertainment format.
Though we’re happy to slap down so much per month on the table for a raft of quality programming, are subscribers, really willing to stump up yet further for premium content on the same platform? Certainly for IMAX CEO Rich Gelfond, PVOD has been proven to be “a failed experiment”. Some might see vested interests behind his statement, but as he told delegates at a recent Goldman Sachs conference, “The numbers haven’t worked in a pandemic, so how would they work in a non-pandemic?”. It’s a fair point.
Some have come to believe, erroneously, that the world of film entertainment is a binary choice — either stream at home or release to cinema with theatrical exclusivity. But that’s not the whole story. Universal and AMC’s deal to accommodate 17-day windows for certain releases and the fact that Netflix itself discussed a possible theatrical release of “The Irishman” with a shorter window demonstrate that a cinema release in advance release on other platforms is the right option for the right content — assuming exhibitors will stomach it. Less a case of having your cake and eating it, more a case of using the right ingredients in the first instance. Scorsese’s recent deal with Apple for “Killers of the Flower Moon” starring DiCaprio and De Niro will see the film receive a wide theatrical release with partners Paramount. Quality will out: truly worthwhile films won’t exist solely online if there is value in a theatrical release. And the backlog of content in the 2021 slate suggests that quality and value definitely exists.
36% Analysis of their customer transactions by Revolut and the Bank of Ireland illustrated an average 36% increase in subscriptions to Netflix for each month between March and July. WFH: unshackling the commuter
In the battle of in-home leisure vs out-of-home leisure, let’s not forget the increasing prevalence of three little letters — WFH. Cinema’s audiences aren’t going to be absent forever, but there is a good chance that their working practices may have changed, at least in the short-term and potentially more permanently. It’s by no means an option open to all, but for many the requirement to work from home brings significant advantages, not the least of which is time. Though the kitchen table office environment may not be ideal, workers worldwide have switched onto the fact that more time is now available. With the shackles of the office undone for many, the result is a more flexible working day, shorter “Where do you commuting hours and, consequently, want to be after a increased leisure time. And where do busy day Zooming? Arguably not inside you want to be at the end of a busy day Zooming in the sitting room? Arguably not within the exact same four walls the exact same four watching television. walls watching TV.” As the pandemic wanes (which it surely will) the appeal of out of home leisure will increase. Already the terms “revenge travel” and “revenge spending” have been coined for the anticipated post-pandemic booms in the holiday and luxury goods markets. Why shouldn’t our sector be encouraging viewers to watch “revenge movies” on the big screen?
Waiting for sunnier days… for how long?
Right now Studios are stuck between a rock and a hard place, with exhibitors enduring their share of the exact same pain. For distributors, releasing expensive movies in cinemas now risks insufficient returns. But why risk a further hit releasing A-grade content online-only, whether as part of the marketing drive to boost subscriptions to your new streaming service or to enjoy a diminished revenue with no box office returns?
When audiences can return in earnest, the premium that cinemas should really concern themselves with is less the competition from online offerings and more the delivery of the best experience possible. Post-Covid, there will still be a place for theatrical exclusivity and the qualities the big screen experience espouses. As one industry insider puts it: “We don’t want anyone to abandon the theaters, we just want consumers to have choice. Think about cooking. You can cook a great chicken at home or you can go to a restaurant and have chicken. The restaurants don’t say, well, we need to have an exclusive on chicken. Instead, they just say, we do a better job. It is great to go to a restaurant, and it’s great to go to a movie theater.” And which movie insider said this? It was Netflix CEO Reed Hastings of course.
