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Mega-Canadian theater circuit Cineplex has become the third major movie chain in North America to endorse Universal’s new premium video-on-demand (PVOD) window as struggling exhibitors chart a new future amid the COVID-19 crisis.
The two companies on Friday said they have struck a multiyear agreement that sets a 17-day exclusive theatrical window for small and midrange title and a 31-day window for larger event pics (i.e., any film opening to $50 million or more domestically). After that, Universal is free to offer its movies on PVOD. To date, the emerging industry standard is $19.99 for a 48-hour rental.
Prior to the novel coronavirus pandemic, most cinema circuits refused to play any movie that didn’t abide by the traditional theatrical window of 74 days to 90 days.
The Cineplex arrangement mirrors a deal announced earlier this week by U.S. exhibitor Cinemark and Universal that expanded upon a historic pact struck this summer between AMC Theatres and the NBCUniversal-owned Hollywood studio.
Terms of the various deals haven’t been revealed, but insiders say exhibitors will get a share of the PVOD revenue.
“The pandemic has given the industry and movie-lovers around the globe a new appreciation for the magic of the big screen experience,” Cineplex president-CEO Ellis Jacob said in statement. “We are pleased to work alongside like-minded partners such as Universal, a studio that respects the theatrical window and is committed to the sustainable long-term health of the theatrical ecosystem.”
Added Universal Filmed Entertainment Group chair Donna Langley: “With audience fragmentation accelerating due to the rise in digital, streaming and cord-cutting, as well as the unprecedented issues our industry is facing right now, our relationship with exhibition had to evolve and adapt to the changing distribution landscape.”
Some studios, like Universal, have tried for years to shatter the window and test the bounds of PVOD in North America, but have always backed off amid threats of theater boycotts.
Following a theater reopening starting in June, Cineplex has seen overall attendance and revenues tumble this summer and fall, compared to 2019 levels amid stringent COVID-19 restrictions and delayed Hollywood tentpole releases.
The Canadian exhibitor is betting the promise of a vaccine being distributed in mid-2021 will be a possible pandemic cure to help bring customers back to the multiplex. Cineplex also received a blow when UK-based Cineworld Group, which owns the Regal Entertainment chain stateside, pulled out of a $2.1 billion deal to acquire the Canadian circuit.
Cineplex has launched a lawsuit against Cineworld over the abandoned deal, which would have created one of the world’s largest cinema companies with more than 11,200 screens globally.
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