Regal CEO Says Paramount's Early VOD Plan "Does Not Make Sense"
Amy Miles is the first top theater executive to speak out against Paramount's bold proposal.
Regal Entertainment won't be signing up for Paramount's plan to redefine theatrical windows any time soon.
On Thursday, Regal CEO Amy Miles criticized a deal between Paramount and two theater chains, AMC Entertainment and Cineplex, that will make Scout's Guide to the Zombie Apocalypse and Paranormal Activity: The Ghost Dimension available digitally 17 days after they all but leave theaters.
That means customers could watch the two fall films in the comfort of their own homes as early as six to seven weeks — instead of three months — after they first open in theaters. Film companies argue that some types of films, such as genre titles like Paranormal Activity or Scout's Guide, have a short theatrical shelf life, yet are still bound by the 90-day window set by theater owners.
In return, Paramount will share an undisclosed portion of proceeds of the VOD revenues through the 90-day window.
But Miles said the economics of the deal "do not make sense to us" and that Regal's screens would be reserved for movies using a traditional release. She did, though, praise Paramount for allowing exhibitors to weigh in on its unusual arrangement with AMC and Cineplex.
"We appreciate Paramount’s willingness to seek exhibitor input and provide for exhibitor participation in certain ancillary revenues as they evaluate alternative distribution models. However the parameters of the current proposal, both economic and structural, simply do not make sense for us given the potential risks to the long term health of our business. As has been the case historically, we will utilize our screens to exhibit films distributed using a traditional distribution model that respects the existing theatrical window," Miles said.
She said that Regal remains open to experimentation as long as initiatives "grow the pie" of revenue and profit for all parties, and if she deems that the potential of reward is commensurate with the risk involved. The Paramount deal, though, does not meet those requirements.
Regal is the first circuit to speak out against Paramount's plan.
Earlier Thursday, word broke that five additional theater chains will sign deals with Paramount to carry the two films. The new group of circuits includes National Amusements, the cinema chain owned by Sumner Redstone and his daughter, Shari. (Redstone controls Paramount corporate parent Viacom and CBS Corp.). The others circuits are the New Orleans-based Southern Theatres, which is among the 10 largest circuits in the U.S., Alamo Drafthouse Cinema, Canada's Landmark Cinemas and upscale exhibitor iPic.
All told, the seven theaters working with Paramount have a combined marketshare of more than 30 percent across the U.S. and Canada, with more than 670 locations and over 8,000 screens.