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Paramount To Test Early Digital Releases, Ahead Of Theaters

bbender - July 17, 2015 - 0 comments

Paramount Decides To Test Early Digital Releases, After Theater Ticket Sales Slow

According to reports, Paramount Pictures signed an agreement with 2 of the leading theater chains which will effectively break the longstanding ban that exists on early release of films in the home entertainment network.


Agreement with Theater Chains

The agreement reached with Cineplex and AMC Entertainment Holdings will make possible for the online purchase of two movies releasing this year just seventeen days after distribution of those movies to three hundred domestic theaters.

The aim is to address the growing rumbling between theaters and film studios heads. Theaters are insisting on being provided exclusive window of around 4 months to show new releases. As DVD sales are fast declining, Hollywood is eager to explore internet sales by the younger generation, on films as well as streaming services like Hulu & Netflix.

Which movies will be used in the new distribution model?

Both(2) movies will be horror titles which generally attract the younger generation. As per statistics, these horror movies tend to generate most of the ticket sales within the first 4 weeks after their release. The two movies are to kick this model off are:

  • Paranormal Activity: The Ghost Dimension which will be releasing in theaters on 23rd October.
  • Scouts Guide to the Zombie Apocalypse which will release a week after the first movie release.

These type’s of horror movies are most suitable for home video releases, while blockbusters are not currently considered ideal candidates as they remain popular and can keep on generating box office revenue for several weeks (sometimes months) after their release.

No Tentpoles

The big budget family movies and tentpole titles like Transformers will stay destined for huge theatrical release since they can generate revenue for several weeks in a row stretch. In  the case of horror movies, these generate their $40-$100 million in ticket sales within 1-4 weeks but will not be able to keep sales much longer than that.

A Closer Look at the Agreement

According to the agreement, these two cinema chains; Cineplex and AMC Entertainment Holdings will be given a share from digital sales generated in the first ninety days after the movie releases in theaters and would be proportional to what they would normally receive as box office share.

It is worth mentioning here that new movies normally debut in around three thousand to four thousand locations. A movie typically generates just about 1% of its box office revenue after screen count falls under 300. So this is a big deal!

Cineplex has welcomed this effort and mentioned it as one of the most innovative models for distribution of films. Per the theater chain, this new film distribution model establishes as well as recognizes the importance of theatrical exhibition for everyone and at the same time provides flexibility to distributors.

Paramount Pictures is in talks with other theater chains as well as and is contemplating expansion of this strategy for similar films.

We will have to wait till October to see whether this strategy works or not. With technology raging ahead in nearly all industries, we think things will turn out well for some of these first titles, if no other reason the new “cool” factor of direct release studio films.