Regal joins AMC Theatres in refusing Universal films over 'Trolls World Tour' streaming success
As if Hollywood wasn't already in chaos enough because of the coronavirus, movie theaters are now going to war with Universal Pictures.
Following a Wall Street Journal article where NBCUniversal CEO Jeff Shell lauded the streaming success of "Trolls World Tour" in the wake of theaters closing and said that they would release some future projects on multiple formats, both AMC Theatres and Regal Cinemas – the two largest chains in North America – have announced that they won't show the studio's movies when theaters reopen.
In a press release sent out Wednesday, Regal's owner, Cineworld, argued that it doesn't make economic sense for the company to show movies that fail to respect the theatrical windows. By breaking that understanding at the height of the COVID-19 crisis when theaters are closed, thousands of employees are at home and no clear date for reopening, Cineworld said Universal’s move to streaming with its titles is inappropriate and has nothing to do with good-faith business practice, partnership and transparency.
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On Tuesday, AMC CEO and President Adam Aron wrote an open letter to Universal chairwoman Donna Langley affirming its new status quo.
"It is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us with no choice," Aron said. "Therefore, effectively immediately AMC will no longer play any Universal movies in any of our theaters in the United States, Europe or the Middle East. This policy … goes into effect today and as our theaters reopen, and is not some hollow or ill-considered threat.
Aron also took a warning shot at other studios, extending that same policy to "any movie maker who unilaterally abandons current windowing practices absent good faith negotiations between us." In addition to Universal shifting their movies to streaming in the wake of theaters closed worldwide due to COVID-19, Warner Bros. recently announced that its animated Scooby-Doo reboot "Scoob!" would premiere on streaming platforms May 15 instead of waiting for a theatrical release.
AMC and Cineworld's new policies come on the heels of Universal's announcement that "Trolls World Tour" has racked up $100 million in its first three weeks of on-demand digital play. (By comparison, the original "Trolls" film in 2016 made $116.1 million in its first three weeks of theatrical release.)
“The results for ‘Trolls World Tour’ have exceeded our expectations and demonstrated the viability of (premium video on demand),” Shell told the Journal. “As soon as theaters reopen, we expect to release movies on both formats.”
Aron concluded his letter by saying AMC, the largest theater chain in North America, is willing "to discuss different windows strategies and different economic models" with Universal. "However, in the absence of such discussions, and an acceptable conclusion thereto, our decades of incredibly successful business activity together has sadly come to an end."
The National Association of Theater Owners also weighed in Tuesday, saying the result of "Trolls World Tour" doesn't indicate a shift in viewing preferences and should not be interpreted as a sign of a “new normal” in the movie industry.
“Universal does not have reason to use unusual circumstances in an unprecedented environment as a springboard to bypass true theatrical releases,” NATO President and CEO John Fithian said. “Theaters provide a beloved immersive, shared experience that cannot be replicated – an experience that many of the VOD viewers of this film would have participated in had the world not been sequestered at home, desperate for something new to watch with their families."
In a statement from Universal to USA TODAY late Tuesday, the studio said its goal releasing the “Trolls” movie to streaming platforms was to deliver entertainment to moviegoers sheltering at home when other avenues were unavailable, and based on the positive reaction, Universal believes it made the right move. The studio also reiterated its belief in the theatrical experience, doesn’t think it’s made any statement to the contrary, and is disappointed by what Universal views as a coordinated attempt by AMC and NATO to confuse its position and actions.
USA TODAY has reached out to AMC for additional comment.