CinemaCon: Distribution Plans Challenge Traditional Models

A recent deal between the four largest U.S. theater chains — Regal, AMC, Cinemark, and Carmike — with producer Robert Simonds’ newly announced movie company could place pressure on the traditional Hollywood distribution model. The new company, backed by investors Hony Capital and TPG Growth, plans to release at least ten films per year, and through a new deal release films directly into theaters, bypassing Hollywood’s major studios.

This pact is unique in that theater owners will be able to access more content, especially movies with a midrange-budget that the studios have ignored as they have begun to release less films per year. Movies that the studios have abandoned will have a chance to be put into production.

“We don’t want to piss off the studios,” Simonds told Variety. “Our goal was to occupy a niche that’s frankly missing.”

Simonds believes that exhibitors have a strong sense of moviegoers’ needs. “They’ve got a strong relationship with the consumer,” he says. “They know who is buying what and when.”

Recent advances have made many of Hollywood’s traditional business models outdated. Simonds’ arrangement signals a significant shift, and the need to identify new ways for movies to be consumed and distributed.

“There are a lot of old rules that don’t make sense anymore,” said John Fithian, president of the National Association of Theatre Owners, at the annual CinemaCon confab this week in Las Vegas.

“The fight to keep younger generations going to the movies — instead of consuming entertainment in their homes or via mobile devices — remains a significant concern and a top priority,” reports Variety.