The Movie Industry: Will it Survive COVID-19? - COVID-19 Clinical Trial
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The Movie Industry: Will it Survive COVID-19?

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    As the world is still in the middle of the COVID-19 pandemic, the global economy trajectory is still pointing down.  To prevent the spread of COVID-19 which in return will help get businesses up and running again, the top 10 theater chains in the United States have shut down.  In a recent count there are roughly 5,548 indoor movie theaters in the United States, with a total of 40,616 screens, according to the National Association of Theater Owners.  The cumulative effort to temporarily close equates to 89 percent of screens across the country that are now left dark.   

    Movie theaters across the country have shut their doors and furloughed most of their workers. In other cases, entire chains have declared bankruptcy.  AMC theaters has started the process of filing for chapter 11.  The thought process behind this strategic move is twofold.  First, the obvious current financial loses and Second, the movie industry will be one of the last to re-open because of the general nature of how close people must sit next to each other during showtimes.  Even when they do open, they will most likely have limited seating restrictions which in return limits revenue.  

    The United Stated stimulus package that has begun rolling out this week has accounted for helping numerous industries including large corporations, small businesses, hospitals, restaurants and plenty of others.  One industry that seemed to be forgotten is the movie theater business.  To combat the complete fall of this famed United States industry, The National Association of Theater Owners asked Congress and the Trump administration for relief measures meant to help their establishments stay afloat until business can resume. 

    Not only are the movie theaters closing but film productions and big budget theatrical releases have been postponed.  The Walt Disney Company, Sony Pictures, Universal Pictures and other major Hollywood studios have delayed releases through May and beyond. Other companies have decided to make movies available for streaming well ahead of schedule. Universal announced that it would offer a handful of recently run theater movies accessible for home viewing at about the price of a regular ticket admission.   

    The theater business is separate from the filmmaking business. Theater owners and Hollywood studios usually split up box office revenue 50-50 in the United States.  Theaters make most of their money on concessions, like the highly inflated popcorn costs, which is revenue they don’t share.  

    This new streaming strategy has left Hollywood wondering whether the traditional release model, which requires movies to play exclusively in theaters for close to 90 days before streaming services can purchase rights, would ever return.  These innovative measures will most likely start to become the norm as industry giants will need to generate revenue by any means possible.  These scenarios are a bad sign for the movie theater industry as they would be left in the dark with the home viewing alternatives. 

    Alternatively, Thomas E. Rothman, the chairman of Sony Pictures, predicted that the appetite for moviegoing would be stronger than ever, once the pandemic passed. 

    “People will want to get out and share communal experiences,” he said. “We will remember how much we love to be all together.” 

    Only time will tell. 

    By Ross Schneidman 

    Sources

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