Meet the Other Movie Lobbyist

8:29 PM PST 03/21/2011 by Pamela McClintock
Andrew Cutraro

On the eve of the first CinemaCon, National Association of Theatre Owners chief John Fithian gives his view on VOD (‘Just don’t invade our space’) and more from the exhibitors’ seat.

For more than a decade, John Fithian has been president of the National Association of Theatre Owners. He doesn’t get ruffled easily, a trait that has served him well. Nor does he resent the fact that in Hollywood, when people hear the word “lobbyist,” they usually think of the MPAA chief, not him.

Fithian has helped shepherd the digital transition — a mammoth undertaking — and navigated plenty of contentious issues, from shrinking windows to piracy to the ratings system. Studios and theater owners have a love-hate relationship, and a big part of his job is to make sure his member companies aren’t jilted. He’s considered a smart, nice guy. One of his latest tasks was taking back the annual convention of theater owners from the Nielsen Co. and putting it in NATO’s hands. The new trade show, CinemaCon, runs March 28-31 in Las Vegas. He also has a new counterpart at the MPAA: former Sen. Christopher Dodd, who is coming to the convention to give a state-of-the-industry briefing with Fithian on March 29. It will be Dodd’s first public appearance in his new role.

Fithian is no stranger to politics: His dad, Floyd Fithian, was a Democratic congressman from Indiana. Today, John Fithian, 49, and his wife split time between Washington and Los Angeles. He’s a father of three; one of his favorite things to do is to take his 8-year-old daughter to the Regal theater in Alexandria, Va., where one of his sons works.

Some studios are talking about starting a premium VOD service and offering movies in the home 60 days after their theatrical release. At a recent conference in New York, you said the studios are in danger of “making a nickel and sacrificing a few dimes.”

What we hope to do, frankly, is work out the windows issue privately and not have it be contentious. There is recognition among exhibitors that studios need to find a new revenue source since DVD sales are down considerably. We understand this, but they should not import the problems of home video into the exhibition model. The exhibition business is growing; it’s working. They shouldn’t mess with our side of the business. We think they should experiment with VOD in a window prior to DVD, but without invading the [90-day] theatrical window. Eight weeks is still bad. If they can get more money with VOD, great; go for it. Just don’t invade our space.

What’s the worst crisis you’ve faced?

The biggest crisis was just before I was named president, when I was outside counsel for NATO. This was right after the Columbine tragedy, when Hollywood came under attack. A whole bunch of bills were introduced that would have turned the ratings system into law and imposed steep fines and criminal penalties for anyone violating the system. There also were proposals to tax movies. That was the biggest lobbying blitz we’ve done. Thankfully, we were successful.

Most people don’t realize that NATO and the MPAA jointly founded the ratings system.

I’m glad you noted that we are involved. The rules are determined by both of us, though the MPAA does more of the work because they hire the raters. Parents use our system to make informed choices for their kids, and that’s the purpose of the system. It’s a very important educational tool. You are always going to get criticism on the margins, but you have to draw the line somewhere, and sometimes a movie comes close to the line. Of the hundreds of films rated each year, only a few are appealed. In 2010, 706 movies were rated; of those, 10 or less were appealed. The low number shows how legitimate the system is.

Some in Hollywood grumble about the increase in ticket prices. Critics say it could be hurting theater traffic and contributing to the current box-office slump.

In the past few years, our ticket prices have gone up slightly more than the rate of inflation. That’s because of things like digital cinema, 3D and stadium seating. In other words, we’ve improved the moviegoing experience, and the patrons are willing to pay for that better experience. There has been a debate about the varying differences between a 2D ticket and a 3D ticket from theater to theater, but that has evened out. I hope we continue to offer patrons the choice between 2D and 3D. Some families don’t want to pay the extra price; many do. Some love 3D, some don’t. I have one kid who digs it and one who doesn’t. Imax is another choice. Those are three different choices. And that’s a good thing.

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The conversion to digital isn’t a sexy-sounding topic, but it has been your tenure’s cornerstone.

I think the transition to digital cinema and the 3D experience remain the biggest issues facing the exhibition industry. We are installing digital equipment as fast as possible. The ramp-up is really flying now. And don’t forget, 3D exhibition is what kept domestic box-office revenues at $10.6 billion in 2010, even though admissions declined by 5 percent. The difference was the ticket prices and the extra revenues we got out of 3D. There will be tremendous focus on digital at CinemaCon. We’ll have James Cameron, George Lucas, Jeffrey Katzenberg and Chris Meledandri on a panel, talking about digital filmmaking. That’s a pretty historic gathering. Yes, the geek factor will be high at our convention this year because of how important digital cinema and 3D are to us.

ShoWest, owned and operated by Nielsen, was a brand in its own right. Why did NATO and its members decide to break away from Nielsen and launch a new event?

The reason we took it back was several-fold. When you run a show as a nonprofit organization — which NATO is — versus for-profit, you’re not looking for big returns that a for-profit company would want to make. We could lower registration fees, which we did. We also could put more money into the show. Also, we moved the location of the convention from Paris/Bally’s to Caesars Palace — it’s a more upscale property and more accessible. Those are the key reasons.

Studios cut back on their involvement in ShoWest in recent years. Are they back in force this year?

Studios are very supportive because they like the new location. Also, we are combining our event with a big industry charity, the Will Rogers Motion Picture Pioneers Foundation. In the past, the annual Pioneers dinner was held separately in Los Angeles. We are combining it this year and holding it Wednesday night. NATO is contributing the dinner proceeds to the charity. That’s the kind of thing we can do as a nonprofit that we couldn’t do before. Former Disney chairman Dick Cook will be the honoree. He’s rather beloved by theater owners.           

 

MYTHBUSTER: Fithian cites and dispels the top 5 Washington myths about the movie business.

1. The film industry is full of liberals.
“Not true. Most theater owners are Republicans. And there are quite a few conservatives in Hollywood, too.”

2. The ratings system is law.
“We get inquiries from congressmen saying there’s a kid who snuck into a theater, and will he be prosecuted. We have to remind them that the ratings system is voluntary and that there is something called the First Amendment.”

3. Theater owners can and should control the content of movies they exhibit.
“We got complaints from Jewish leaders about showing The Passion of the Christ; we got complaints from Republicans about Fahrenheit 9/11. Our point back to them: Our job in a free society is to offer up all choices.”

4. The movie industry is all glitz and glamour.
“There’s a lack of understanding about how important the industry is to the balance of trade. Our theater companies are involved in building cinemas all over the world, and the studios are involved in exporting movies around the globe.”

5. The piracy problem isn’t all that bad.
“Most politicians understand the issue of piracy, but a few still don’t understand the impact on American jobs. They think the impact of movie piracy is only on rich stars. They aren’t thinking about the 160,000 employees working for movie theaters.”

 

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