VOD Doesn’t Compete With Movie Theaters, Says Alamo Drafthouse Founder

Thankfully in 2020 there are still some theater chain owners unafraid of VOD.

“Cinema is not competing against VOD. It’s not competing against home entertainment. It’s competing against restaurants, comedy clubs and out-of-home experiences,” said League, over Zoom, after sharing, “At Arthouse Convergence years ago, Ira [Deutchman] gave a keynote address about the long history of the death of it, from television to cable to VHS to DVD, and everything had been wrong so far. People inherently as a society want to get out of the house and that is more true than ever right now.

Alamo Drafthouse Founder Tim League:
“Cinema Is Not Competing Against VOD”

League is sort of correct. The bolding in the quote above is mine. It’s important to understand the movie theater experience is different than the at-home viewing experience. I’ve detailed the differences several times in the past here.

The other thing to understand is how much people are willing to pay for live events vs. pre-recorded events.

Movies are not epic live sports matches.

$100 is too expensive for watching a new movie. Studios might (crazily) try this price point and there might be some equally crazy takers, but the numbers won’t be there.

I don’t see how movies will ever be comparable to live events.

A play is a live event, but I can’t even see paying $100 to watch a play streamed live. In person, sure, if the seats are good, but not on TV. Live is, well, live. Something recorded and edited just has a different value to it. Not the same entertainment experience.

Sports are different. You need to see them live so you can share in the result. Like when Mike Tyson bit Evander Holyfield’s ear in their famous rematch (yes, we paid for this pay per view and saw this live)

Mike Tyson goes into full Dracula mode on Evander Holyfield … this PPV was crazy entertaining!

Kevin Smith thinks the only way Black Widow goes straight to VOD instead of a theatrical run is if it Disney/Marvel could get $100 for the VOD. Sorry, but no way. $19.99 is a stretch (see: Yes, Some Are Paying $20 to Rent New Movies – But Is This The Right Price Point?), this isn’t a one of a kind live pay per view sporting event (which is about the only type of event that can command that kind of money).

In fact, he predicts it would force movie studios to abandon the theater model altogether. “If we all did that, that would change the world,” he said. “They’d be like, ‘F*ck movie theaters! Sell them these movies for $100 a pop.’” Considering the average movie ticket is $10 to $12, that’s a hefty price jump. Sure, people love the Marvel movies and flock to see them in droves. But do they love them enough to drop a cool hundred just to rent one?

Kevin Smith Bluntly Explains The Only Way That ‘Black Widow’ Could Ever Go Straight To VOD

Even if the pandemic renders movie theaters a place not as many will be going — we will be there as soon as they reopen — overpriced VOD/PVOD will not be the future.

I think the $19.99 price point was tested with Trolls World Tour. Any higher and the number of people that sign up will fall. This isn’t a Mike Tyson boxing event, which, ironically, he seems to be tooling up to box again in exhibition matches for charity. Would I pay to see $100 to see Tyson-Holyfield III live? Probably not, but $50 seems like an instant purchase.

No idea if that would ever happen, but if you think I’m just floating out fictional events, check your news feed with a search on Mike Tyson.

As for movies pushing VOD pricing? I think we’ve seen the ceiling. It’s $20, maybe a little higher. That isn’t going to generate a billion in 2020. This means we can expect to see movie theaters open again and showing new blockbuster movies. More and more people will come back to the theaters for a wide variety of reasons (see: One Big Reason Why Movie Theaters Will Be OK Compared To Streaming)

Summer will get hot and, hopefully, we’ll see theaters open again. July 17, 2020 seems like a target date we’ll be able to watch Tenet in theaters. Sure, that could change, but as of this writing anyway, that date — unless there are more pandemic setbacks — seems at least a little possible.

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