Editor's take: As the CEO, it’s Aron's job to advocate for his company. I get that. But this approach just feels like the wrong way to go about it. AMC took a similar, confrontational stance with movie subscription services a few years back but then ultimately launched its own take on the membership program. This time around, at least from my perspective, they are in no position to be firing bullets but rather, should be collecting health kits. The Coronavirus has exposed the theater business and with the success of Trolls World Tour, studios now have definitive proof that a first-rate movie can make money without a requisite stint in theaters.
NBCUniversal CEO Jeff Shell said earlier this week that the results for Trolls World Tour, the animated film it released to premium video on demand (PVOD) earlier this month, exceeded their expectations and demonstrated the viability of the distribution method.
As soon as theaters reopen, Universal plans to release movies on both formats (through theaters and via PVOD).
AMC Theatres, the largest theater chain in the world, didn’t take too kindly to Shell’s remarks and the perceived threat against its old guard formula.
In a statement published on Tuesday, AMC President and CEO Adam Aron said the “radical change by Universal to the business model that currently exists between our two companies represents nothing but downside for us and is categorically unacceptable to AMC Entertainment.”
As such, Aron said that going forward, AMC will not license any Universal movies in its theaters based on these terms. “Therefore, effectively immediately AMC will no longer play any Universal movies in any of our theatres in the United States, Europe or the Middle East.”
“AMC believes that with this proposed action to go to the home and theatres simultaneously, Universal is breaking the business model and dealings between our two companies,” he added.
Aron noted that the policy is not aimed solely at Universal but rather, also extends to any movie maker that “unilaterally abandons current windowing practices absent good faith negotiations between us, so that they as distributor and we as exhibitor both benefit and neither are hurt from such changes.”