After coronavirus, what happens to Hollywood and movies?

Chris DeGraw/Digital Trends

Theaters around the country are beginning to reopen, but when they do, will they have any movies to show?

Life in the time of coronavirus has quickly become Hollywood’s very own, real-world horror story, and when the scariest parts of this saga are behind us, the movie-watching experience might look very different than it did just a few months ago.

From the selection of movies available in theaters in a post-pandemic world to the path movies take to screens big or small, the coronavirus has shaken up everything about our relationship to cinema, and what’s likely to be the new normal going forward could take some getting used to.

There’s never been anything quite like the coronavirus in Hollywood’s past, but fortunately, we have plenty of clues about what the movie business holds in store for us in the future.

To premiere or not to premiere

It’s difficult to understate how dramatically the spread of the coronavirus pandemic has changed the world in just a few weeks — particularly when it comes to communal activities like heading to the theater to catch a new film.

As social distancing removed the option of watching movies in theaters and left a Hollywood-sized hole in cinephiles’ viewing habits, studios were forced to come up with new ways to get their projects in front of audiences and put a dent in the high cost of making movies.

It could take months to safely bring theater attendance levels back to where they were pre-coronavirus.

While some studios were quick to turn to an on-demand, pay-per-view model for their films, others have played a waiting game with the pandemic, pushing back release dates and shuffling their calendars until theaters can reopen. Some have even experimented with traditional models of film distribution in one way or another, tweaking the typical path films take from studio to viewers’ home TVs.

It’s an unprecedented time for the movie business, and although movie studios have typically been slow to embrace new trends in distribution (just ask Netflix), this shift in the industry has led them to consider some surprisingly outside-the-box ideas.

And they’ll need all the new ideas they can muster to deal with the trouble ahead.

Box-office bottleneck

Even as theaters begin to reopen, getting back to business as usual remains a complicated proposition.

Relaxing the national social-distancing guidelines is a multistage process in most cases, with smaller gatherings initially allowed, as well as thorough (and expensive) new health and safety requirements. The latter includes lengthy new sterilization procedures between screenings, new seating arrangements, and a complete rethinking of how concessions are handled, according to an April report published by Deadline. The path back to full occupancy is expected to be a staggered journey of action, data collection, and reaction, and movie theaters — by virtue of the tightly packed, communal environment they operate in — will likely be a Petri dish of sorts in this grand experiment .

VLADIMIR SIMICEK / Getty Images

Even the most optimistic, realistic projections suggest it could take months to safely bring theater attendance levels back to where they were pre-coronavirus, further shrinking an already small window for getting films in front of big-screen audiences.

Put it all together and studios will have even fewer options when it comes to generating a return on projects that were delayed by the pandemic.

That could lead to some interesting scenarios playing out on screens of every size.

First showing

No matter how big the living-room screen or how high the resolution, nothing is quite like the movie theater experience, particularly when it comes to the large-screen IMAX format or theaters with state-of-the-art audio and video systems. Studios know that, and so do many of the filmmakers who work with them.

“Chris [Nolan, five-time Oscar nominee and Tenet director] really would like to be coming out with the film that opens theaters,” IMAX CEO Richard Gelfond told investors during an earnings call earlier this month (as reported by Variety). “I don’t know anyone in America who is pushing harder to get the theaters reopened and to get his movie released than Chris Nolan.”

Nolan’s Tenet is one of the first big films still scheduled to hit theaters, holding fast to its July 17 premiere date. However, if the movie hopes to cover its $205 million production budget (as well as all of the other costs a film tends to accrue on its way to theaters), it’s going to need to put a lot of butts in seats over a long period of time — a period of time that will grow even longer under strict theater occupancy restrictions.

According to Deadline, Tenet studio Warner Bros. Pictures will need at least 80% of the world’s theaters to be open when it premieres, including those in coronavirus hot spot New York, as well as in Los Angeles and San Francisco, in order to have a glimmer of hope of covering its costs. In the U.S. alone, the film would need to be screened in 3,500 of the country’s pre-pandemic pool of 5,000 theaters (a number that’s shrinking as the lockdown stretches on) to turn a profit. Internationally, that figure is more than 30,000 theaters worldwide.

Those are some big numbers for theaters that might be operating at 50% (or less) capacity. Given the crowded calendar most major studios manage under normal conditions, this could mean that they — and the theaters they partner with — are going to have some tough decisions to make regarding which movies make it to the screen and how long they stay there.

Survival of the biggest

At the moment, the next three big films scheduled to hit theaters are Tenet (July 17), Disney’s live-action Mulan (July 24), and superhero sequel Wonder Woman 1984 (August 14).

The three films will need a long and profitable run in theaters not only to be successful for studios, but to prove theatrical releases can work during social-distancing conditions. Studios aren’t particularly fond of gambling with their biggest projects, after all, so if one of the three films falter, it could be a long time before studios are willing to test those waters again.

Smaller films that would have traditionally filled the gap between big-budget, tentpole releases might find themselves in scheduling limbo.

This need to to wring maximum revenue out of the highest-profile releases means there isn’t likely to be a lot of screens available for lower-profile, mid-level, and small-budget features in those early stages of reopening the theater industry. Smaller films that would have traditionally filled the gap between big-budget, tentpole releases might find themselves in scheduling limbo, circling the theater until a screen frees up like so many airplanes over a crowded airport.

A situation like this could shake up the usual hierarchy of films and the theaters screening them, and create a new — albeit temporary — norm for both theaters and movie fans.

In one potential scenario, small, independent theaters that typically offered indie and arthouse films could become the only big-screen outlets available for mid- and small-budget films crowded out of the multiplexes, and independent films could find themselves competing with larger productions as studios attempt to get their projects in front of any crowds, no matter how small.

How it all shakes out remains to be seen, and although theater chains bristle at the idea of any films — no matter the size — going straight and streaming, such practices could be necessary in the short term as studios, theaters, and audiences ease back into the movie business.

Testing the on-demand waters

In recent months, we’ve seen studios turn to streaming as an option for avoiding the impending box-office bottleneck.

Universal Pictures was one of the first major studios to pivot to streaming after the pandemic hit, opting to send its thriller The Invisible Man and several other films that were in theaters at the time of lockdown directly into the on-demand marketplace. Although numbers are still fuzzy on some of those theater-to-streaming pivots, the direct-to-streaming data we have has already created waves through the industry.

In late April, Universal Pictures announced that the animated sequel Trolls World Tour — which was originally scheduled to hit theaters April 10 — earned nearly $100 million in three weeks of $20 digital rentals. The film’s streaming revenue over that period was more than the first Trolls film earned during its five-month theatrical run in 2016.

“The results for Trolls World Tour have exceeded our expectations and demonstrated the viability of premium video on-demand,” said Jeff Shell, the head of Universal’s parent company NBCUniversal. “As soon as theaters reopen, we expect to release movies on both formats.”

He wasn’t the only one with a strong reaction to the Trolls sequel’s success.

The film’s performance essentially elevated on-demand streaming from a second- or third-tier option to a viable alternative to theatrical release, and this news didn’t go over well with AMC Entertainment Holdings, Inc., the world’s largest theater chain. AMC responded by banning Universal films from its theaters going forward — a gamble (or bluff, depending on how you look at it) that could cost the chain billions of dollars and arguably do more to hasten the theater industry’s demise than help it.

Beyond all the bickering, however, one fact became abundantly clear: Movies don’t need a theatrical release to be profitable.

And that’s something other studios seem to have taken note of, too.

Don’t worry, be streaming

With the industrywide backlog of delayed films growing, Disney joined the list of studios leveraging their streaming options when it decided to send several upcoming films direct to Disney+, its subscription-based streaming platform.

Among them was the long-delayed Artemis Fowl movie, starring Colin Farrell, Judi Dench, Josh Gad, and other familiar faces, which had initially been scheduled to hit theaters May 29. That film, which had been delayed several times over the last few years already, will now debut on Disney+ in June. Similarly, a recording of Broadway’s award-winning musical Hamilton that was originally scheduled to hit theaters a year from now, will go directly to Disney+ in July.

With audiences stuck at home due to social distancing measures, Disney also moved up the streaming premieres of Star Wars: Episode IX — The Rise of Skywalker and Frozen 2 to get them to Disney+ subscribers earlier — slashing the traditional window of time between a film’s arrival in the DVD and Blu-ray market and its streaming premiere.

The decision to dramatically reduce that window of time might not seem like a big deal to outsiders, but it’s another indication of studios’ growing inclination to bend industry traditions in order to serve streaming audiences going forward.

Disney and Universal aren’t the only studios embracing on-demand streaming options, either. Sony Pictures recently announced that its World War II drama Greyhound, starring Tom Hanks, will be sent directly to on-demand video, while Warner Bros. Pictures did the same with its animated feature Scoob! just a week ago (on the same date it was originally scheduled to premiere in theaters).

Narrowing the divide

So what might all of this mean for the average movie fan?

In the near future, it likely means fewer new movie options at your local theater if and when they do reopen. Of those options, big-budget tentpole features are likely to dominate the available screens even more than they did prior to the pandemic as studios try to hit necessary revenue marks, while smaller films will be afforded a much smaller theatrical run (if made available at all).

Many mid- and small-budget movies with few theater options in their region will almost certainly need to turn to streaming services and on-demand video. The number of these films heading directly to streaming could also increase significantly as we get closer to the end of the year and studios’ backlog builds up.

Much to theater chains’ dismay, the typical window of time between movies’ theatrical runs, physical home-entertainment (DVD, Blu-ray, etc.) releases, on-demand availability, and arrival on streaming services is likely to be a lot shorter going forward as studios move toward a more concentrated revenue-generating period for each film. Whether this will lead to more or less exclusivity when it comes to certain films’ availability on one streaming service or TV network or another remains unknown at this point as various media companies compete for a larger pool of movies entering the home entertainment market.

Drive-in movie theaters are already experiencing a resurgence of sorts with their ability to provide both a communal and socially distant experience.

With theaters now beginning the early stages of reopening around the U.S., the world’s largest movie theater market, how things develop in the next few months will shed quite a bit of light on how quickly — or slowly — we’ll return to something close to business as usual.

Although Universal, Disney, and other studios have found a way to strike gold in the streaming video environment, there’s still plenty of profit potential in theatrical releases — even when social-distancing is still in effect. However, the affordability of high-resolution, large-screen TVs and cinema-quality sound systems has increasingly blurred the lines between movie theaters and home theaters, so it remains to be seen whether audiences will feel compelled to abandon the movie-watching environment they’ve grown accustomed to the last few months.

In a recent poll published by Variety, 70% of respondents indicated they would rather watch new movies from home than in theaters if possible, while just 13% said they preferred the theater experience (17% indicated they had no preference or weren’t sure which they would prefer). Those numbers certainly don’t look good for anyone hoping theaters will make a speedy comeback.

On top of all that, drive-in movie theaters are already experiencing a resurgence of sorts with their ability to provide both a communal and socially distant experience.

Still, even with all the question marks surrounding what we can expect from the post-coronavirus movie experience, one thing seems certain: The relationship between studios, movies, and their audience has become far more complicated. Even after this pandemic is in the rearview mirror, the definition of “business as usual” in Hollywood is going to be very, very different than it was just a few months ago.

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