J.J. Abrams: Proposed $50 Home Movie Service "Beneficial" to Movie Theaters

J.J. Abrams - H 2016
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Abrams is among a number of high-profile directors and producers supporting Sean Parker's plan to make new films available in the home, including Peter Jackson, Ron Howard and Brian Grazer.

Star Wars: The Force Awakens director J.J. Abrams is the latest Hollywood filmmaker to explain why he supports a controversial plan to make new feature films available in the home for $50 the same day they hit cinemas.

Abrams spoke to The Hollywood Reporter at the South by Southwest Festival on Monday only hours after Ron Howard and Brian Grazer issued a public statement backing the Screening Room, a new company from Napster founder Sean Parker and music executive Prem Akkaraju.

"I responded to that system mostly because it actually is beneficial to the exhibitors," Abrams told THR at an event after his SXSW panel with The Jinx filmmaker Andrew Jarecki. "I think the metrics on that are very impressive and they're targeting groups that actually don't go to the movies at all. If they could harness even a fraction of the number that don't [go to theaters], the amount of money that would go to the cinemas is significant and actually is amazingly helpful to the cinematic experience."

On Sunday, Peter Jackson was the first filmmaker to confirm he is advising the Screening Room, whose focus is capturing consumers who don't otherwise go to the movies, versus catering to the typical filmgoer. And they plan to give theater owners $20 of every $50 spent to rent a film for 48 hours via an encrypted set-top box costing $150.

“When we met Sean and Prem last year, it was clear Screening Room was the only solution that supports all stakeholders in the industry: exhibitors, studios and filmmakers," said Howard and Grazer. "The SR model is fair, balanced and provides significant value for the entire industry that we love. We make movies for the big screen and for as many people to see it. Screening Room uniquely provides that solution."

So far, no one from the Screening Room has outlined to the media what that model is. In his statement, however, Jackson provided some of those details. (Jackson's support is significant, since he was among 23 filmmakers who signed a letter in 2011 opposing a premium VOD plan on DirecTV.)

"I had concerns about DirecTV in 2011, because it was a concept that I believe would have led to the cannibalization of theatrical revenues, to the ultimate detriment of the movie business," he said. "Screening Room, however, is very carefully designed to capture an audience that does not currently go to the cinema."

Jackson continued: "This is a critical point of difference with the DirecTV approach — and along with Screening Room's robust anti-piracy strategy, is exactly why Screening Room has my support. Screening Room will expand the audience for a movie — not shift it from cinema to living room. It does not play off studio against theater owner. Instead it respects both, and is structured to support the long-term health of both exhibitors and distributors — resulting in greater sustainability for the wider film industry itself."

Theater owners aren't entirely convinced, however. While AMC Entertainment has signed a letter of intent to do business with the Screening Room, pending a number of contingencies, Regal Entertainment and Cinemark aren't likely to go along.

"I think this is not a good idea, and I sincerely doubt the studios will go for it at that price point. It feels like a half-baked plan to me," Tim League, founder and CEO of Alamo Drafthouse Cinema, told The Hollywood Reporter on Sunday.

While Cinemark wouldn't reveal its position, CEO Mark Zoradi issued a statement raising his concerns.

"The exhibition window has been the most stable window long-term and the theatrical success of a film drives the value proposition for the studios’ downstream ancillary markets," he said. "Cinemark believes that any day-and-date propositions must be critically evaluated to avoid the devaluation of the exhibition window and all subsequent revenue streams of our content providers.

“Cinemark diligently evaluates and considers all business proposals. We have great relationships and an open dialogue with our studio partners and work directly with them individually regarding film content, windows, and decisions that may impact the long-term health of our industry," said Zoradi, a longtime studio executive who recently took the job at Cinemark.

Cinemark is the third-largest chain in the U.S. behind Regal and AMC Entertainment.

Other filmmakers and producers advising the Screening Room, represented by attorney Skip Brittenham, includes Steven Spielberg, Martin Scorsese and producer Frank Marshall.

March 14, 5:15 p.m. Updated with Abrams' comments to THR.