Fear and loathing in Las Vegas: Hollywood faces theater owners after streaming new movies during pandemic

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Corrections & Clarifications: An earlier version of this report misstated the title of the new “Spider-Man” movie. The film is “Spider-Man: No Way Home.”

LAS VEGAS – There were many villains revealed at this year's CinemaCon, the annual Las Vegas conference for theater owners.

Movie previews showed Michael Myers is back in Universal's "Halloween Kills." Sony brought back ‎Alfred Molina's Doctor Octopus for "Spider-Man: No Way Home," Ethan Hawke is a dark supernatural freak in the Blumhouse terror "The Black Phone."

But nothing has scared theater owners, already hit hard by the pandemic, more than Hollywood's surging business model of releasing films simultaneously in theaters and at home. It used to be that theaters would have a firm, exclusive 90-day window to debut films. But as the COVID-19 pandemic slammed theater doors shut across the country last year, studios leaned into variations of the simultaneous home release to reach audiences stuck at home.

Even with theaters open (amid still-spiking COVID-19 variants) palpable concern was always just below the surface throughout the festival that ended Thursday, concluding the first CinemaCon since pre-pandemic 2019. Flare-ups of emotion and rare inter-studio criticism were heard from the stage.

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"Dune" will be released simultaneously in theaters and on HBO Max on Oct. 22. Director Denis Villeneuve said recently he's "still not happy" about it.
"Dune" will be released simultaneously in theaters and on HBO Max on Oct. 22. Director Denis Villeneuve said recently he's "still not happy" about it.

One of the loudest spontaneous applause moments at the starless exhibition occurred when Josh Greenstein, Sony president of worldwide marketing and distribution, lashed at rival studios incorporating day-and-date releases.

"Debuting movies simultaneously in theaters and in the home is devastating to our collective business," Greenstein said from the podium, while adding that Sony was "at the core, protecting the exclusive theatrical windows." Greenstein stayed optimistic about the industry, saying cinemas “and the theatrical movie experience will triumph" in difficult times.

His boss, Sony motion picture group chairman and CEO Tom Rothman, leveled his own broadside at rival Disney (which merged with 20th Century Fox) by cleverly complimenting the studio for the financial success around the theater-only release of Ryan Reynolds' "Free Guy."

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Chairman and CEO, Sony Pictures Entertainment Motion Picture Group Tom Rothman speaks onstage during CinemaCon 2021.
Chairman and CEO, Sony Pictures Entertainment Motion Picture Group Tom Rothman speaks onstage during CinemaCon 2021.

"That film has done great business," said the newly bearded Rothman from the stage. "No. 1, because it's terrific. No. 2, because you can't watch it at home on television. Go (expletive) figure!"

As the theater owner-applause rolled against Disney, a studio that has leaned into the hybrid release model throughout the ongoing pandemic (to the consternation of theater owners and "Black Widow" star Scarlett Johansson, who took legal action), Rothman added, "You remember Bill Clinton and ‘It's the economy, stupid?’ It's the window, stupid."

The Warner Bros. presentation took on greater import in the wake of its pandemic window policy. The studio announced in November that Gal Gadot's big-ticket return in "Wonder Woman: 1984" would be released on fledgling streaming service HBO Max as well as in theaters that remained open. A month later, Warner Bros. announced it was releasing all of its 2021 movies on HBO Max the same day as theaters. This included big theatrical movies that have not been released like "Dune" and "Matrix 4" (which earned the title "Matrix: Resurrections" at the festival).

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Ann Sarnoff, chair and CEO of WarnerMedia Studios, cited "unprecedented times which call for creative solutions" at the time. But the move spurred theater owner consternation and prompted director Christopher Nolan, a longtime director of Warner Bros. films, to lament to The Hollywood Reporter that "some of our industry's biggest filmmakers and most important movie stars went to bed the night before thinking they were working for the greatest movie studio and woke up to find out they were working for the worst streaming service."

In the eight months since, the industry has kept experimenting: while MGM's Bond film "No Time to Die" held out for a theater spot (now Oct. 8) and Paramount's "Top Gun: Maverick" remained grounded (pushing again from its summer date to Nov. 19), NBCUniversal gave "Trolls World Tour" a simultaneous digital rental and (primarily drive-in) theater release that set digital records with homebound families. Disney released tentpole films like "Black Widow" and "Jungle Cruise" with a hybrid release.

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Some peace deals have been made as the industry moves, in fits and starts, toward a sense of normalcy. Before theater owners gathered this month, Warner Bros. signaled that the studio will premiere its 2022 slate on the theatrical screen for a shortened, exclusive 45-day window.

With the symbiotic relationship between theater owners and studios, CinemaCon is not the kind of place where pitchforks and torches come out. But there were dire warnings about losing the theatrical windows trumpeted from the stage.

National Association of Theatre Owners chief John Fithian roused the faithful Tuesday, thundering, "Let me be clear about one thing today – simultaneous release does not work. It doesn’t work for anyone. A steady flow of strong movies released with windows is essential to the recovery of the industry and to the profitability for the entire ecosystem."

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CEO & President of Marcus Theatres and NATO Chairman Rolando Rodriguez speaks onstage during CinemaCon 2021.
CEO & President of Marcus Theatres and NATO Chairman Rolando Rodriguez speaks onstage during CinemaCon 2021.

Tim League, founder of the Alamo Drafthouse Cinema chain, says the mood at the convention was clouded by recent tough times. "There has been concern in the room amongst exhibitors. Obviously, this has been a year and a half of concern and uncertainty for the business in general," League tells USA TODAY.

But League says this has been tempered "in general by the belief that things can go back to normal," even if "the days of the 90-day window are gone."

The back-to-business mantra was evident right through the bullish festival slogan: "The big screen is back." While short on specific promises, successive studios took their turn on the CinemaCon stage to emphasize the value of the theater experience, thanking the theater owners for their vital support. Even Vin Diesel thanked them onscreen for showing box-office monster and beacon of theatrical release hope, "F9," which crossed $700 million worldwide during the convention.

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Disney punted on facing exhibitors during its presentation, giving up its allotted time to show a full screening of Marvel's "Shang-Chi and the Legend of the Ten Rings" (which is debuting with a 45-day theatrical window). Warner Bros. execs cited family obligations as the reason the studio's presentation was filmed and shown on the Las Vegas screen rather than delivered in person.

Warner Bros. domestic distribution president Jeff Goldstein said during the presentation that "controversial choices" were made in the hard pandemic times "but we worked through it all with you, our partners."

"But going to the theater is simply in our DNA,” said Goldstein reassuringly, "and that will never change. That won’t be replicated in any way."

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This article originally appeared on USA TODAY: CinemaCon: Hollywood faces theater owners over streaming releases