(Bloomberg Note) – Movie theaters are starting to reopen their doors, but they are unlikely to find many protectors who stand for cards, as Covid-19 fears continue to affect consumer decisions.
On Thursday, AMC Entertainment Inc. 170 of its theaters have reopened around the country, including in cities such as Atlanta, Chicago, Dallas, Denver, Indianapolis, Miami, Nashville, Philadelphia and St. Louis. That is in addition to 115 other AMC cinemas that reopened last week. The company aims to get two-thirds of its 600-theater circuit on time for Warner Bros. ‘September 3 release of “Tenet”, a spy film directed by Christopher Nolan that was originally scheduled to have its box office premiere in mid-July. Regal, a subsidiary of Cineworld Group Plc of London, and Cinemark Holdings Inc. also reopened the majority of their American theaters to the premiere “Tenet”.
Bringing back cinemas is not just about being able to watch a movie again. Their reopening symbolizes a greater return to normal – the ability to not be afraid to return. But a feeling that it is safe to do so and that the virus is under control must come first. In a Morning Consult survey of 2,200 adults in the U.S. conducted in early August, 74% said they were unlikely to visit a movie theater next month; 60% of respondents who are considered frequent filmgoers said the same. About a third stream “Tenet” most favorably from home, while 13% said they would be willing to pay for a digital rental home.
Morning Consult also found that about half of its polls believe that Hollywood should delay all theatrical releases from August and September. Of these, 54% said that premieres from 2020 should be postponed until next year. This is further evidence that viruses threaten themselves – not just government orders restricting certain activities – are hurting American businesses and the economy. (Read my column Noah Smith of Bloomberg’s opinion in June, “Fear of Infection Hurt the Economy More Than Lockdowns.”)
AMC got this wrong once before when it initially said that theatergoers would not wear masks when they returned. Chief Executive Officer Adam Aron said it was because the company did not “want to be drawn into a political controversy” over masks. That thinking backfired because requiring face masks not only makes customers safer, it makes them feel safer, increasing the chances of them returning to busy public destinations such as theaters. After the crash, AMC reversed the course and will require everyone to wear masks. The chain and its rivals have detailed other safety measures, such as limiting the number of tickets sold, blocking seats, improving cleaning procedures and upgrading air filters. The Regal website also states that any cardholder experiencing Covid-19 symptoms can request a refund online. Despite the efforts of the sector, most consumers may not yet be quite ready to sit back and relax in a cinema seat.
Other movie fans may find some movies worth it. For example, poll opinions were divided on what to do with Walt Disney Co.’s Mulan ‘, with almost as many people saying they’d rather see it in theaters than stream it on the Disney + app. It’s perhaps reflective of both the power of Disney’s blockbuster movies at the box office and the company’s need to keep those ties strong, even when it’s all about streaming. Disney finally decided to make “Mulan” available exclusively to Disney + subscribers on September 4, who will have to pay the app’s $ 7 monthly subscription price above $ 30 shipping costs. (Comcast Corp.’s Universal has taken things further by cutting the time for one of its films to remain exclusive to AMC for only 17 days.)
Fear of returning to theaters shows that just because companies reopen does not mean customers will appear. Reducing the virus is still the key to restoring the economy.
This column does not necessarily reflect the opinion of the editorial staff as Bloomberg LP and its owners.
Tara Lachapelle is a Bloomberg Opinion columnist who deals with entertainment and telecommunications, as well as broader deals. She previously wrote an M&A column for Bloomberg News.
For more articles like this you can visit us at bloomberg.com/opinion
Subscribe now to stay ahead of the most trusted source for business news.
© 2020 Bloomberg LP
