U.S. Movie Theaters Aim to Stay Open Amid Coronavirus Concerns

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An empty Stanford University campus in Santa Clara County, where movie theaters are staying open amid a "mass gatherings" ban.

Cinemas in Santa Clara County on Tuesday announced they are exempt from a ban on mass gatherings.

Movie theaters across the U.S. are aiming to stay open amid the coronavirus outbreak, which has prompted some local authorities to limit mass gatherings.

Early this week, Santa Clara County in Northern California — which includes San Jose — issued an order banning events that bring together 1,000 or more people in a single room or single space at the same time, such as in a stadium, arena, large conference room, meeting hall, cafeteria, theater or any other confined indoor or confined outdoor space.

The ban does not impact commercial movie theaters since individual auditoriums operating in the county seat fewer than 1,000 people, according to the National Association of Theatre Owners of California/Nevada.

According to the Santa Clara County decree, a "mass gathering" does not include normal operations at airports, shopping malls or other spaces where 1,000 or more persons may be in transit. It also does not include typical office environments or retail or grocery stores where large numbers of people are present, but where it is unusual for them to be within arm’s length of one another.

Theater owners would be forced to close if local and state authorities mandated such a measure. "This is an unprecedented situation," says one industry veteran.

New York Gov. Andrew Cuomo on Tuesday announced that certain businesses and establishments, including schools, would close within a one-mile "containment" zone in New Rochelle, a hotspot for the virus. No movie theaters operate within the impacted radius.

As the cases of COVID-19 increase in the U.S., Hollywood and the exhibition business are growing increasingly worried about the impact on moviegoing. So far, two studio releases — the James Bond pic No Time to Die and Peter Rabbit 2: The Runaway — have been pushed back because of worries over the virus.

"I think theaters are preparing for all contingencies. I don't think you will see a countrywide shutdown, but there could be some closures on a local level," says Wall Street analyst Eric Handler of MKM Partners, which tracks exhibition stocks. "We are still seeing an accelerated number of cases, and I don't think the worst is over."

The major theater circuits didn't immediately respond to requests for comment on developing events, but insiders say cinemas across the country have increased safety measures in recent days. Some chains are also modifying sick leave to make it easier for employees to stay home if they are feeling ill.

Almost all cinemas in China — the world's second-largest moviegoing market behind North America — went dark more than a month ago because of the virus, while all of Italy is now quarantined. Historically, firms in the U.S. have vowed to stay open during various outbreaks, even if business slows to a standstill.