As a result of the lockdown and other restrictions and health protocols, many movie theater chains now face debts that will likely put them out of business
Already reeling from the impact of a year of lockdowns, movie houses around the world look set to close in their droves in the coming months, perhaps never to reopen, after Warner announced that from 2021 it will distribute its films on its HBO Max streaming service at the same time as in theaters, effectively delivering a death blow to the theatrical window. Previously, another major studio, Universal, announced an agreement with a chain of cinemas, Cinemark, to shorten that window from the usual three months to just 17 days.
Some say that the decision does not mean the end of movie theaters, but just a way for studios to try to improve next year’s results. But many in the media are already talking about the end of the movie theater experience: after all, watching a movie in a theater implies remaining in a closed environment for a couple of hours, something that few people want to do at the moment, even when wearing a mask. As a result of the lockdown and other restrictions and health protocols, many movie theater chains now face debts that will likely put them out of business. It’s doubtful that movie theaters will still be there when people consider returning to them: to make many of their big budget productions profitable, the studios need a business model that allows them to show their films on screens around the world at once, a near impossibility for the foreseeable future.
Perhaps surprisingly, online services such as streaming have little to do with the decline of the movie theater: myriad studies show that regular users of services like Netflix not only watch more content sitting on their sofas, they also go to the movies more often. This has prompted speculation that Netflix, Amazon and other streaming services might buy movie theater chains to showcase their growing output, thanks to changes to US antitrust rules that prevented studios from buying movie theater companies to prevent a single player from controlling the entire value chain. In November 2019, the Department of Justice announced that this rule, in force since the 1940s, would be revised due to the increasing complexity of the industry and the presence of new players such as streaming companies.
In May 2020, there were rumors that Amazon might buy the AMC network, a move that would allow its productions to compete in the Oscars and other major awards and movie festivals.
Others, like Bigscreen, are talking about recreating the cinema experience virtually, which would allow us to ‘go’ to the movies with friends; another approach to the metaverse, where we share things by combining immersion in an environment with a social experience
When a change in the environment means customers no longer see a certain activity as a habit, and this situation continues for more than a year, the writing is on the wall; in this case, for movie theaters. Sure, we’ll be watching more content than ever, but we won’t be going to the movies to do so, and instead we’ll use new technologies that can offer an experience that is possibly comparable, on the sofa at home, perhaps with VR glasses on and a bowl of microwaved popcorn. Is this the end of the movie theater as we know it?