36
votes
Sony Pictures acquires Alamo Drafthouse cinema in landmark deal that puts studios back in theater game
Link information
This data is scraped automatically and may be incorrect.
- Authors
- Pamela McClintock,Alex Weprin,James Hibberd
- Published
- Jun 12 2024
- Word count
- 1087 words
Sony is the first studio to purchase a theater chain since the repeal of the Paramount Decree back in 2020. It's actually surprising how long it's taken for a studio to do this.
I'm the opposite. With covid and movie theaters generally scraping by, it's surprising for a studio to step into this game. Maybe this signals a shift in strategy and studios start to back away from streaming release two weeks after the initial release in theaters.
The removal of the Paramount Decree restrictions, and the sense of weakening strength and reputation of US regulation generally, however, give studios exciting opportunities in the business that independent theatres don't have. There's a chance to return, with the added advantages technology, data mining, and targeted advertising brings, to the very profitable studio system, and much more effectively exploit consumers.
With both streaming and theatre ownership, a studio could ensure that they control all distribution methods for their films, and directly receive all revenue. The question of how quickly to switch to streaming would no longer be a question of cutting out independent intermediaries. Exclusive theatrical runs, cutting out independent theatres, could offer considerable control. With popular franchises, studios could offer 'experiences' of offerings at a high, studio-set price point to maximally engage devoted fan bases, presenting new productions either earlier before streaming, or 'enhanced' performances only ever shown at the studio's theatres. Merchandising could also be integrated into the theatre space more effectively, perhaps also, especially for children's films, incorporating Disney's innovations in displays of others' experience of 'privileged' consumption to induce feelings of envy and unlovedness in children and guilt in parents. And utilizing viewing and demographic data from their streaming platform, and enhanced data collection in theatres, a studio could precisely target both what they screened at any particular theatre (and how and when they screened it), and how they advertised. Modern multiplex theatres could be particularly suited to precise targeting.
Sony is perhaps not in the best position for these sorts of strategies; a studio like Disney could do very well, but is probably still concerned about being a target for regulation. But you can see the ideas forming, with the "Sony Pictures Experiences" name, and the mention of the theatre's "differentiated moviegoing experience" and how "our Crunchyroll business aligns well with their audience's interests" before feeling the need to add on that they "will, of course, continue to welcome content from all studios and distributors".
I do fear that studios owning theater chains will completely cut out indie theaters from showing some blockbuster hits. If you can only watch the new Spiderman movie at a Sony owned theater, then smaller, small town theaters will take a serious hit from this.
I think that the concern - that studios owning theatres will introduce exclusivity - is a valid concern, and I don't want to undercut it. However, I don't think that this will put Sony in a position to start any kind of exclusivity for new releases. There are ~6000 cinemas in the US, and as far as I can tell, there's about 50 Alamo drafthouses. However, I could see something like "opening on Tuesday at Alamo Drafthouses, and on Wednesday across the US" or something of the kind giving exclusive one-day-early access. Even that might be a non-starter though, because of how opening weekends are calculated, which they certainly would not want to mess with. They won't want to waste a full day of their opening week box office results on anything other than 100% of cinemas.
However, maybe if they do a back catalog run, that could be problematic? ie. Sony would charge more for indie theatres showing older Sony releases?
Well Sony benefits from this in a way since their model is reliant on theatrical. They’ve been the studio most committed to releasing their films theatrically, and it’s been profitable for them especially in the ancillary market with PVOD and Netflix turning even small money losers like No Hard Feelings into profitable films. This strategy also makes it so their films become incredibly popular and last however many weeks in the Top 10 on Netflix.
Disney currently has a theater in LA called El Capitan. And it’s super nice, they have an ice cream parlor next to it where they sell Disney merchandise. With how good Disney is at quality control I wouldn’t mind Disney having a theater chain with a similar quality to Capitan. Though I hope they’d at least play movies other than Disney releases.
Seeing a movie at the El Capitan is one of those items on my bucket list, but I would be scared of Disney owning an actual theater chain at a national scale. Not because I think they would be bad theaters, but because of how aggressive Disney already is with existing chains and independent theaters. If Disney did something like buy Cinemark, or god forbid, AMC, it would give them tremendous leverage over independent cinema operators who are already stuck with the short end of the stick.
I don't understand why they didn't do this sooner.
It made sense during COVID when packed theaters presented a public health risk, so this was a good way to earn positive PR, release your movies, and juice your streaming subs. But it was never a sustainable strategy in the long run, and it's been nearly two years since things largely returned to normal.
One possibility is that the streaming deal is way better if the movie is just a couple weeks old and the studios might keep a bigger cut than from theater revenue. Wouldn't be too surprising if they still are able to fuck over the talent even now that streaming is a known quantity.
Couldn't say whether this is good or bad, but I hope it doesn't put an end to Alamo showing classic movies periodically. I don't get to go too often, as they're about 35-40 minutes away, but the few times I've gone to see something (last one was Lost Boys), it's just good fun to see something that old back in the theater.
Well new people are in charge now. Alamo is a big unknown at the moment thanks to the buyout.
Sony's senior executives, at least some of them, will likely have some sway to have say. Some of them will have authority over Alamo -- sorry Sony Pictures Experiences -- either directly or indirectly via the water cooler and internal corporate politics. The old Alamo CEO, Kustermann, now reports to the Sony COO as the head of the new SPE division.
So we have to wait and see what changes. Odds are, some things will. For example, do they tell Kustermann that the "no talking or you're tossed" policy is over? Or do they permit that to continue? Do they tell Kustermann there's no budget for pre-show reels, as another example of something Alamo did to stand out from the rest of the country's theaters?
If Sony wanted Alamo because of those things, and the key executives with control don't meddle, then it's just a rebranding. But, usually, everyone wants to piss on something, mark their territory. They want changes, so they can point to them and say "that's mine, I made that happen." Corporate history is full of buyouts that turned the purchased property into something unrecognizable.
What if Sony wants to use Alamo as the playbook for SPE going forward, and even wants to put some additional money into it so they can expand the footprint into more markets? And, if Sony does want those things, are there executives with power within Sony who will beat off any other executives who try to slide in and meddle?
Alamo is the only thing currently in the North American theater market that makes me want to consider going to a theater. If I can sit in one of their auditoriums and know the audience is going to shut up and behave and simply watch the movie ... that would get ticket purchases from me. But there's not one near me, so I haven't had the pleasure yet.
I guess we'll all have to wait and see. The next few months should start to give indicators as to what Sony considers Alamo; a blueprint or just a convenient little block of thirty-five theaters they could buy in one chunk.
Good god I hope not, I can't imagine why you would want to get rid of this rule. Has anyone ever said "no, I won't go to the movies unless there are assholes talking loudly during it"?
I hope they don't turn Alamo into what every other theater is. Alamo is really the only reason I even go to the movie theater anymore. I had been 4 or 5 years without going at all until I discovered this place near me.
Seriously, I'm a season pass holder and spend way too much money on food there as a result. If they change anything, I will be livid.
On the other hand, Sony also owns CrunchyRoll. More anime would be nice, and Alamo is one of the few that already gets US distribution of some anime films.
Curious if your feelings towards Alamo have changed over time at all? The more I go the more it seems that the food & drink delivery aspect (plus paying) very often takes me out of the movie watching experience. Maybe the training has gone downhill or something since employees are trying to talk to me during the movie a lot more and don't seem to care about obstructing the screen when walking past
I only moved to an area with one a couple of years ago, but they've been fairly consistent. I usually make sure to get there around the time the doors open and place a food order right away, which usually arrives during the preroll. They don't seem to worry about obstructing the preroll, but I've never had significant interruptions from staff during the film, even when using order cards.
Alamo has been beleaguered financially for years, but has managed to preserve most of their customer experience in the process. Prices haven't been great, but the combo of increased ticketing/concessions costs and selling off vanity projects like the Ritz on 6th street in Austin seems to have helped keep them from completely collapsing.
I get the feeling they'll be pretty hands off. Hopefully Austin will see all the pretty ubiquitous Alamo locations stay open.
Six Alamo franchisee theaters recently closed, so hopefully this means Sony buys those back to re-open them.
Sony's head Tom Rothman recently decried the price of movie tickets and said theaters should offer Discount Tuesday prices year round. So maybe that will start happening with Alamo. It'd be an interesting experiment to see if lowering prices actually increases admissions.
I wonder if the sudden closing of all of the DFW area Drafthouses instigated this deal with Sony. That Sony was circling around the chain for awhile, and taking those properties off their balance sheet was what prompted them to finally fuck.
The DFW locations were all owned and operated by a franchisee, so they wouldn't have showed up on the balance sheet.