ONE OF THE BIGGEST THEATER CHAINS EVER blocks universal’s films

By: Keaton Marcus

AMC Theaters recently announced that due to NBCUniversal CEO Jeff Shore’s comments that one of their VOD releases was successful, they will not be releasing Universal movies anymore. This could inflict major losses on both companies and sadly, I don’t think AMC thought this “I’m gonna get back at you” idea through. Sure, AMC is one of the biggest theater chains in the world, which means Universal’s movies will have a significantly smaller theater count, but it’s a loss for AMC as well, since Universal makes many big movies. The whole thing is a baby-like revenge plan because of a simple comment and will hopefully blow over after the Coronavirus crisis begins to slow down.

Just in case you didn’t know, Universal, among other major studios, released several of their theatrical films such as Trolls World Tour, The Invisible Man, The Hunt and Emma straight to VOD due to the Coronavirus crisis and the mass closing of movie theaters around the globe. In response to Jeff Shore’s comment on Trolls World Tour being a hit on Amazon Prime Video and Apple TV, AMC co-chair Adam Aron responded with “it is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us no choice. Therefore, effective immediately AMC will no longer play any Universal movies in any of our theaters in the United States, Europe and the Middle East.” Damn.

Shore had already told The Wall Street Journal that Universal would be releasing film theatrically as well as digitally after the Coronavirus blows over, but that didn’t seem to have any effect on AMC’s actions. Universal reported that World Tour made over 100 million dollars in on demand sales in North America alone, making it a hit. Studios and movie theaters share just about 50% of the box office grosses, but in VOD, studios get around 80%, which means that Universal got about 77 million of the digital pie.

This means that technically, in three weeks of VOD release, Trolls: World Tour has made more than its predecessor did over five months of theatrical release. But that’s not correct, is it? The first Trolls movie made over 153 million in theatrical sales, but with the theater-studio split, Universal only made 76 million of that cash, meaning less than it’s sequel did. This means World Tour is a big success, despite the fact that it won’t be the end of moviegoing. However, it does prove that even without any theaters to play in, when families are all home, they watch their movies, big screen or not.

What’s especially funny about AMC’s move is that the theater chain is on the brink of bankruptcy during the Coronavirus crisis. Even Variety, a major newspaper, is questioning AMC’s survival during these pressing times. They report that “AMC Theaters looks to be on the brink of filing for bankruptcy, a grim but impending reality that was only exacerbated by the Coronavirus pandemic causing the entire movie business to shut down.” Yep, this virus could actually bring down one of the biggest movie theater giants in the world. Reportedly, Wall Street analysts downgraded the company’s stock from neutral to sell. This means that the theater chain is expected to fall to the virus in the coming months. So what position is AMC in to ban Universal’s films from their cinemas when they are already having financial troubles?

Back to the AMC comment, this means that all 1,000 AMC theaters around the globe will not show Universal movies. Most of those theaters are in the US, roughly 661 cinemas, and the Universal film Jurassic World played in 4,274 theaters across North America, but take away those 661, you have only 3,613 theaters left to play in. Jurassic World would have only made around 84% of it’s earnings if this happened in 2015. That wouldn’t have been terrible, but think about all the minor Universal movies, all the movies that don’t even play in 3,500 theaters originally, what would happen? It’s either a hit or it isn’t taking away 661 theaters from a release. So it will become a big problem for Universal.

Though it will still leave a mark on AMC’s shirt as well. Why? Well, Universal is most likely the biggest studio in the world taking away Disney, I mean they make films like Jurassic World, Fast & Furious, the Illumination animated films such as Lorax, Grinch and the Despicable Me franchise. Several of their films have grossed over one billion dollars, and others have come close. Heck, they’ve even got Mamma Mia on their side. Not releasing any Universal movies in their theaters will be an issue for AMC since they won’t get any of their dough anymore. Yep, no more Vin Diesel, fast-car fueled cash for AMC anymore!

Don’t worry, Universal has also got some films in the future such as the third Jurassic World movie, the ninth Fast & Furious installment, the second Halloween, Minions sequel and more. AMC won’t get a slice of that dino roar-fast car-Michael Myers-cute little yellow people-cold hard cash anymore, whether they like it or not. To AMC exclusively…you may want to think this over some more.