Third weekend of January 2023
Since it’s quarterly reporting season, I thought I would remind you of something one of the smartest people in the business said to me about 10 years ago when the idea of collapsing windows was being pushed. ‘If we’re not careful with this, we’re gonna ruin both businesses’. So as we look at all the opinions published this week on how each Studio and Streamer did for the most recent quarter, there’s three things that seem to be at the top of the ’next steps’ list. Revenue streams, revenue streams, revenue streams. During the buildout of the streaming platforms, you gave seemingly everyone in town ’the bag’ (including many of you on this email), Wall Street would eventually like a bag too.
Rather than experiment with different windowing scenarios, the pandemic created a de facto monopoly for about a year and a half; and based on the decisions that will be made over the next couple of years, that monopoly might have either ruined both (actually all three if you include linear TV/Cable), or made them more efficient. But what’s interesting is how all this (forced) experimentation showed us that the old way isn’t that bad.
For movies, it’s clear that the revenue generated by a one revenue source subscription woefully undervalues the content, and by guiding the consumer (through windowed tiers) to pay for content based on what they will pay (as opposed to what they want to pay) and get them to pay for it more than once, the money spigot turns back on. Now that we’ve seen the idea of ‘Exclusive to (platform name here)’ is fine for that platform, but it doesn’t diminish minutes viewed or churn based on where it was before (like theatrical), but actually improves the measurements on the platform once it gets there. It seems like the logical move is mining each tier as much as possible (based on the viability of each film). And there’s very little evidence that a single platform can corner the market by producing a ton of content based on hitting a ‘movie a week’ quota. No one is panicking quite yet, but you can pretty much see the analyst opinions a couple of quarters from now when subscriptions are good but revenues still aren’t, and when they get knocked down the phrase will be something like ‘because they are undervaluing their content’, or even worse ’they continue to produce content that is unable to generate revenue in the premium tiers’. Revenue streams, revenue streams, revenue streams.
Obviously the pandemic took its toll on theatrical, but as another very smart person once told me ‘every house in the world has a kitchen, but you still have restaurants’; so just like the restaurant sector, theatrical is slowly clawing it’s way back. And last weekend showed that theatrical has come a long way since the shutdown. The whole weekend behaved like it was pre pandemic, and it seemed like we had ‘walk up’ business, which we haven’t seen a lot of since the shut down. Now a lot of that probably has something to do with.…..hmmmm…. can’t remember… oh yeah….movies that are entertaining. It was also a weekend of a lot of variety, where there was something for everyone. Of course, that didn’t help the Regal Sherman Oaks stay open, but when Arclight made it one of the best theaters in LA by having an Arclight Cinemas sign at one of the busiest freeway intersections in the country and Regal had…Regal (maybe it’s a dry cleaner?), they probably got what they deserved.
Anyway, with the accuracy generally associated with a TJ Holmes HR seminar, here are some thoughts on the weekend box office.
*Avatar The Way of Water *- It’s not quite doing Avatar stuff this weekend (Avatar was only down 18% the corresponding weekend), but it’s still damn good. Figure it’s down about 35% for a weekend in the low 20’s.
Puss in Boots The Last Wish - Holding up really well today, but there’s a lot of theaters (mostly in Canada) that are way up today, and I’m not sure why. Looks like a weekend of 9 or 10.
A Man Called Otto - Clearly a crowd pleaser, this should be around a while. Today and tomorrow should only be down about 25 or 30%, but it will drop a little more from last Sunday because there’s no holiday on Monday. Looks like about $9 million.
Missing - This followup to Searching looks very similar on a theater by theater basis, but this is on 3000 screens and when Searching went wide it was only on 1000. This looks like around $7 million for the weekend, which is about what it cost. As you may have heard though, that should have been a little lower but they went a little over budget; the wifi got a headache and went to it’s trailer, and until the internet intimacy coordinator could get Frontier on the phone, they lost some days.
That Time I Got Reincarnated as a Slime: The Movie Scarlet Bond - Another Anime title from the bottomless pit of content over at CrunchyRoll, on a theater by theater basis it looks a lot like The Quintessential Quintuplets Movie. I’m not sure how many more titles they have that sound like titles of a Friends episode, but these lower tier titles tend to fall in half tomorrow and drop again Sunday. They’ve got a few more runs than Quintessential here, so figure about 700k for the weekend.
The Whale - Why am I writing about a film that’s gonna end up in 9th or 10th place this weekend? Because it’s almost even with last week again, and as it’s been pointed out in the trade press over and over again, the specialty sector is in trouble. But is it? Even though this is a challenging subject with an LGBT angle, it’s playing rock solid in the markets you need a specialty film to play in. Could it be that this is one of the only specialty films that doesn’t have a title that tells the audience ‘I’m too smart for you, please stay home”? Might be a coincidence, but this is looking like another $1.5 million this weekend.
The Son - Went 550 runs and other than a theatre in Seattle and a theater in Austin, it’s not very good at all. Figure maybe 250k for the weekend.
When You Finish Saving the World - Went about 200 runs and other than the Alamo Brooklyn, where there’s a Q and A, it’s not very good. Looks like about $75k for the weekend.