AMC and Cinemark believe that 2020 is no time to die.
In the wake of Regal Cinemas closing their movie theaters indefinitely across North America following the delay of the James Bond thriller No Time To Die (following a long series of movies that have abandoned the 2020 calendar), AMC and Cinemark have committed to remaining open, even as the market remains risky and volatile in the ongoing Coronavirus pandemic.
AMC and Cinemark are, respectively, the 1st and 3rd biggest theater chains in North America to Regal’s #2.
In a statement, AMC attributed their decision in part to the ground-breaking deal they struck with Universal Studios in July, one that allows AMC to share in VOD revenues for Universal films that launch on VOD three weeks after their theatrical debuts.
AMC CEO Adam Aron said:
- “Fortunately for AMC, our groundbreaking agreement with Universal Studios announced earlier this summer puts AMC in a position where we can open our theatres when others may feel the need to close. We are fully comfortable showing Universal films in our theaters, even as they implement premium video on demand as we have mutually agreed. This is because AMC will share in premium revenues coming from their early availability in the home.”
Other theater chains have been reluctant to strike a similar deal with Universal or any other studio, fearing such pacts endanger the viability of the theatrical business model.
For Cinemark’s part, they are the best-leveraged chain of the top three, financially speaking. AMC and Regal face debts mounting in the hundreds of millions of dollars while Cinemark remains in the black, for now.
Also, Cinemark has no footprint in New York City. In the age of COVID, this is actually a significant positive. NYC and Los Angeles theaters remain closed indefinitely due to ongoing pandemic levels there. The closure of those markets was another reason behind Regal’s decision to shut their doors for now, whereas it remains a minimal factor for Cinemark since they’re only affected by conditions in one of those two metroplexes.
In addition, three of Cinemark’s theaters were recently among the Top 10 locations for the ongoing top film in this muted market, Tenet. That showing further reveals how their position reflects strength geographically.
A representative for Cinemark said:
- “Cinemark’s reopening plan was designed with multiple contingencies in place to ensure we are able to be nimble and react as needed to this ever-changing environment. We do not currently have plans to close our U.S. theatres and are continuing to align with demand, including reducing operating hours and days while we await new studio content to encourage theatrical moviegoing,”