Cinemark Threatens to Ban TOWER HEIST from Its Theaters in Response to Universal’s VOD Plan

by     Posted 3 years, 73 days ago

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Just yesterday, Universal Pictures announced it would be releasing Brett Ratner’s Tower Heist to premium VOD subscribers a mere three weeks after the movie opens in theaters on November 4th. In direct response to this announcement, Cinemark (the nation’s third largest theater chain) has threatened to ban the movie from all 300 of its locations. This is a bold move that our own Matt Goldberg agreed with in principle, but didn’t expect to happen. As Matt mentioned, Tower Heist could potentially be a very successful film as it “has the stars, a sound comic premise, and it covers multiple demographics.” Will Cinemark really risk the tens of millions of dollars it stands to lose by taking a stand? Or will Universal Pictures blink first rather than risk losing the revenue?

Hit the jump for more info.

The Universal Pictures announcement marks the biggest test of the VOD business model so far, as they plan to offer it to the 500,000 or so digital cable subscribers in the Portland, OR and Atlanta, GA regions. Apparently, the higher-ups at Universal had been in discussions with the theater chains for over a year now and didn’t think the threat of 500,000 less tickets would cause any of them to flinch. Although “Cinemark recognizes and acknowledges the changing technological landscape and related challenges that Universal and the other studios are facing in the in-home window,” their understanding is apparently not enough to merit their approval.

In a continued statement from Cinemark to the LA Times:

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“Cinemark has urged Universal Pictures to reconsider its market test of this product. If Universal Pictures moves forward with its ‘Tower Heist’ premium video-on-demand offering as announced, Cinemark has determined, in its best business interests, that it will decline to exhibit this film in its theatres.”

The two larger cinema chains, AMC Entertainment and Regal Entertainment, have yet to side with either Cinemark or Universal. Each of the theater chains have stood together in protest before, so it will be interesting to see the fallout. Yes, obviously movie theaters stand to lose money if patrons stop going there. But let’s break it down for you, the consumer (who always seems to be forgotten in these discussions).

You and the family could go out to the theater on the weekend of Black Friday to see Eddie Murphy and Ben Stiller’s new comedy, Tower Heist; maybe you even take Grandma. Let’s say you pay $10 a ticket. I’m not a doctor or anything, but that’s at least $40 right there. Then Junior’s got to have snacks and the Missus has to have popcorn and Grandma wants to jazz it up with some Sour Patch Kids. Tack on the gas for your Prius and you’re way over $60 already.

OR you could stay in the comfort and relative sanity of your own home and watch it for $59.99 with all the snacks and drinks and clean, comfortable restrooms you want and none of the crowds or sticky floors or people who ignore the “Don’t Use Your Cellphone During the Movie” PSAs. The stress-saver alone is worth it, though for individuals or even couples, the VOD might still be a bit steep.

Theaters are fighting a losing battle as technology makes it easier (and eventually cheaper) for us to stay cooped up in our homes, doing all the “socializing” through cables and screens. Stay tuned to see how this stand-off shakes down. Who do you think will blink first?

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  • John

    It all depends on how much you spend to go to the movies.

    For example, tickets are $9 at my theater. I usually go with one other person. That’s $18. It is very rare that I get popcorn/soda, unless I have a free concessions voucher.

    So $18 at the theater vs. $60 for the VOD… an easy choice for me.

  • Daniel

    I manage a sixplex in a small eastern KY town: our ticket prices are the most reasonable in the area ($7 for adults & $5.50 for kids, seniors, and military in the evening, $5 and $4, respectively, for matinees), and it’s rare for any family to pay $60 at any time. And yes, before anyone assumes differently, we show new releases, with the rare miss.

    I think that Universal might be mistaken to try this model in it’s current form. I have no problem with the idea of VOD: I believe that there will always be an audience for the theatrical experience, even with the VOD available. However, the experiment earlier this year involving Just Go With It was probably the more sensible approach.

  • John Shutt

    Once again, your facts are absloute BULLSHIT, Goldberg. The theaters will back down when they realize just how greedy they are becoming. This failed the first time and it will fail again. Now quit being a douche and go back sucking Universal’s dick!

  • Twistednic

    I really think the biggest thing they’re missing is that this movie will tank. Ben Stiller? Eddie Murphy? How have they been recently? The entire reason Universal is even debating trying this is because they know it won’t do shit in theaters. The entire controversy is just a weakass attempt at marketing. Wouldn’t be surprised if they called Cinemark in on a collaboration of sorts in hopes that this piece of shit movie might do something.

    Ben Stiller + Eddie Murphy = loss of profits. Why not just call in Jack Black and sink the whole damn industry? Enjoy polishing the brass on the Titanic boys.

    • Markus

      This is the one point that no one else seems to be making – this film looks to be on track for a huge loss, so the whole tickets / VOD debate could be moot.

      I’d love to see this experiment taken with a film like Drive, that stood to make less in theaters but did have very positive reviews and word of mouth working in its favor. Or Take Shelter, which is going to show on far fewer screens (at least at first.)

  • Andrew

    I’ve been hearing this argument for awhile. the theater I go to only charges 8 dollars for tickets and I have been to cinemarks all over the country in big and small cities and unless someone spilled a drink or popcorn THAT screening, the floors have never been sticky so I call b.s. on that…

    yeah, i’ll pay for popcorn but then I GET POPCORN. If i buy the movie at home, I don’t get popcorn for the 60 dollars, I mean i could eat my own popcorn but you didn’t put that in your scenario so that point is just dumb.

    • John Shutt

      I hope that means you’re not siding with the studios, like the author of this article.

      • Markus

        I don’t know if it’s siding with either side, so much as a simple cost analysis. A family of four (including kids, who more often than not want at least a soda or snack) can easily add up to $60. Dave does point out that for people seeing the film alone or with a date, they’re far less likely to add up to that amount.

        Before you dismiss that, keep in mind why it is we keep getting those awful live action / CG films like the Chipmunks or Smurfs – families of four, taking their kids to see a film. It’s an impossible demographic to ignore, whether or not you agree with the studios. It just comes down to money.

  • Ping Pong

    I’m glad thay have balls for this, fuck the VOD Plan!

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