AMC to Open Saudi Arabia's First Movie Theater in Two Weeks

AMC Theater - Getty - H 2018
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The country recently announced it was lifting a 35-year ban on cinemas.

AMC Theatres looks set to win the race to open the first cinema in Saudi Arabia. 

In an announcement made Wednesday, the company revealed that it had won the country's first license to operate cinemas alongside its local partner, the Development and Investment Entertainment Company, and would be opening Saudi Arabia's first movie theater in Riyadh's King Abdullah Financial District on April 18. 

In a conference call following the announcement, AMC CEO Adam Aron revealed some details about the cinema, saying that it was a standalone symphony concert hall that was in the process of being converted. "This will be the prettiest movie theater in the world," he said, adding that it had a "dramatic" exterior, and a beautiful interior, including marble bathrooms.

The news puts AMC ahead of a pack comprising several international cinema operators who have recently announced plans to invest in the Middle East kingdom, and comes less than four months after the country revealed it would be lifting a 35-year ban on public cinemas as part of a major reform drive being spearheaded by its de facto ruler and Crown Prince, Mohammad bin Salman.

European operator Vue and luxury chain iPic have also unveiled their intentions to open in Saudi Arabia, while regional chains Cinescape and Vox are planning their moves. AMC, however, was first off the block when the ban-lifting was first announced by the minister of culture and information on Dec 11, announcing the very same day that it had signed an agreement to explore building cinemas in a country with an untapped market valued at around $1 billion.

The timing suggests that not only had AMC been working on its Saudi expansion long before Dec. 11, but also may have been developing its site in Riyadh. At the time, sources revealed to The Hollywood Reporter that several cinemas had actually been built within new shopping mall developments and were simply waiting for "someone to turn the lights on."

As part of Wednesday's announcement, AMC also said it expected to open up to 40 cinemas in 15 Saudi Arabian cities within five years and up to 100 in 25 cities by 2030, part of a goal to achieve "approximately a 50 percent market share of the Saudi Arabian movie theater industry."

Regarding issues of segregation, which have long played a major part of Saudi society, Aron said that the rules of operation were currently in formation, but he expected the theaters to be "not segregated," possibly with the exception of particular showtimes that may be "reserved for one sex or the other."

As for the films likely to be shown, Aron pointed to the huge appetite for major Hollywood titles elsewhere across the region and said he expected all major release that are "appropriate for the Middle East," to be shown. But he also hoped that the nascent Saudi movie industry might be able to provide local language films.

AMC's news comes just as Mohammad bin Salman — commonly known as MBS — is on a whirlwind three-week tour of the U.S. to firm up business ties and promote his liberalization drive. On Monday he dropped into Hollywood, where he met with Endeavor (Saudi's Public Investment Fund is acquiring a 5 to 10 percent stake in WME's holding company for $400 million) and was the special guest at a party thrown by Rupert Murdoch, rubbing shoulders with the likes of Bob Iger, Dwayne "The Rock" Johnson, Morgan Freeman and James Cameron.

"Where else are you going to find a move market that literally doesn’t exist today that could be $1 billion in size in five years or so?" concluded Aron. "If you can open 100 cinemas in country where there’s literally no capacity today, I think there will be staggering levels of pent-up demand. Were going to sell a lot of ticket."

Motion Picture Association of America chairman-CEO Charles Rivkin and National Association of Theater Owners president John Fithian agreed with Aron's assessment during a press call later on Wednesday discussing the MPAA's annual report.

He said the AMC announcement is just the beginning, and that there are four or five other NATO members who are prepared to build cinemas in Saudi Arabia. “We think there is a huge market. Some have estimated that it will hit $1 billion in a few years.”

Fithian said women and men may have to sit apart, but he's not aware of any final decision. He said that as the culture “evolves,” so will the seating.

“Certainly, not all the movies that play in the U.S. will play in Saudi Arabia. A lot will. Some will be censored,” Fithian said. “We are trying to be respectful of a very different culture.”

April 4, 12:30 p.m. Updated with Fithian's comments.