At the Malco Roundtable: After 100 years, the business is still all about family

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Cinemas Features

“I am third-generation,” notes Stephen Lightman, the chairman and CEO of Malco Theatres, as we begin celebrating the circuit’s 100th Anniversary. “I grew up with the same thoughts about Malco that my dad and granddad had. Quality is the most important part of our business.”

As M.A. Lightman, Jr.’s son and grandson of company founder Morris A. Lightman, Sr., there was never any doubt in his mind about the company philosophy, Steve assures. “We never wanted to scrimp to save money at the expense of the customer. We always wanted to give them the best sight, the best sound and food, the best service. I am sure most companies aspire for the same things, but that was drilled into my head from the time I was young. And I am sure everyone at this table would agree with that: We want to provide our customers with the best possible experience.”

Steve Lightman is referring to his fellow company officers who have joined him for a telephone conversation with Film Journal International at Malco headquarters in Memphis, where the company has been based since 1929. Executive VP, advertising and marketing Robert “Bobby” Levy is the son of Herbert Levy and M.A. Jr.’s sister Jean Lightman. Stephen’s sister Nancy married executive VP Jimmy Tashie, who is in charge of theatre operations and puts his son David Tashie to work as senior VP, operations and construction. Though not present during the conversation, other fourth-generation family members working at Malco are VP of digital operations Wes Lunsford (Bobby’s son-in-law); marketing and design coordinator Mallory Lightman (Steve’s daughter); and Zach Lightman (great-grandson of M.A. Lightman, Sr.) who heads up Premier Entertainment Management.

“I love being in the family and in the business,” Bobby Levy confirms about “working with my cousins and enjoying the excitement of the movies.” Steve Lightman concurs with him, and not only about the family part. “Every week is a new experience, thanks to Hollywood where you find all the geniuses–the best writers, directors and producers, actors and actresses. Every week we get two or three new offerings, which is just very exciting. So many other businesses are mundane and go through the same routine week after week. I think we are very fortunate to be in the movie business.”

Whether this affected his decision to join the family business and whether he actually had a choice to be doing something else instead is an easy question. Lightman taught in college for a couple of years, he relays. “I was a stockbroker too for a few more years. But when my father said they needed more family in the business, I was more than happy to come and join them. This is a great business. I can’t think of a better one to be in and I have been in it all my life. And so has everyone here at the table.”

That goes for the fourth generation as well? “I definitely started in the business on my own free will,” says David Tashie. Like the generation before him, he feels that joining his Malco family was the right thing to do. (His father Jimmy introduces him “as doing all the work… I am very glad David made that decision.”) “After graduating from college in Colorado, I knew how much was going on back home… I realized all they had to deal with, and so I began to stick my foot in and to learn as much as I could.”

Tashie found himself hooking up on the construction end of things. “Just seeing the day-to-day operations, all the moving parts,” he realized “there was room for me and I got more and more involved. I always knew the company was big, but I didn’t quite realize just how many moving parts there were,” he admits. “Once I got in, there was no turning back… And that was almost 15 years ago.”

Since then, father and son have built upon the infrastructure that keeps all 33 of Malco’s theatres running smoothly. “Having a good and strong general manager in each location is huge,” David shares about what is necessary to keep all those parts moving. “Someone I have a lot of trust in and someone that shares equal trust in me. It goes both ways. Our managers know they can call me 24 hours a day and that I will do whatever I can to help them with whatever kind of problem they might have. Having a good person is basically like having a family member at each location. I think that’s a very important part of having a strong operation.”

The family spirit is paying off, he confirms. “We have many long-term employees that started off with us at the ground level as usher, popper, this and that. We are strong proponents of promoting from within, appointing great employees to assistant positions and as general managers.” There is always an opportunity for advancement, he says, by moving to a cinema in another town or getting to run a newly opened location. Before promotion comes basic training, which is another Malco operations staple. “We have a full-scale orientation program that new employees go through with lots of training sessions.” Internal communications are important and Tashie believes in regularly scheduled manager meetings even as interoffice email and Skype have become great facilitators. “We also have hands-on district managers who cover three regional territories that we have established.”

Given the operational structure across the cinemas, one assumes that the executive family has established its own corporate structure. Do they ever fight, one wonders? “Only with our wives, never internally,” one of the executives, who shall remain unnamed for his own good, heartily chuckles. “He is only kidding,” adds another quickly and equally in jest. “All of us get along great,” Steve Lightman goes on record. “Jimmy, David, Bobby and I never had a serious argument. And I do not believe that my dad’s generation did either. They would always talk things through too. I think that is one of the reasons why we have lasted this long. We all like one another and we like working together. Really.” “And we leave our egos at the door,” adds Bobby Levy. “We are here for the greater good of the company and for family harmony. We discuss everything. Our offices are basically side by side, with doors open in between. We are always bouncing things off of each other.”

After all, Lightman opines, taking on challenges as a group is more effective. “We are competing with everyone and every leisure and entertainment activity.” He concurs that this represents an integral part of what has given Malco the edge over these many years. “Our advantage is that we are a smaller company and that we are very much hands-on at the theatre level. More so than at some of the other circuits, at least.”
 
Operating as a regional circuit is another important advantage, he adds. “When we all got into the business,” Jimmy Tashie elaborates upon the company’s development, “we were still dealing with traditional and conventional theatres, smaller units, twins and the like. Maybe there was a quartet here and there,” he allows. “We built our first big multiplex in Memphis in 1987. That was the beginning of our–and the industry’s–understanding that the more variety we could offer to our patrons, the more likely we were to attract a higher attendance. That trend picked up all across the country and the world, of course. Multiplexes are our bread and butter still, today. But when an architect told us we really needed to go and check out this new theatre in Dallas, Texas, that was booking up all the business in the area because of the number of screens and its stadium seating,” the industry was up for another change. “We chartered a plane and headed down there, taking our architect with us. All of us realized that we had just seen the future.”

Tashie is talking about The Grand, of course, Stan Durwood’s AMC 24-screen milestone megaplex that just entered its third incarnation as Studio Movie Grill Northwest Highway. “After we got back to Memphis, we stopped two projects cold because they were conventional theatres. We had realized that was not the direction of the future. We redesigned everything and have never looked back. That’s the way it has been ever since.”

Whereas this “first upheaval during our generation,” as Tashie calls “the structural change from conventional floors to stadium-seating theatres” occurred around 1996-97, the other big, if not bigger, one called digital conversion happened more recently. “We’ve had to deal with a structural and a technological milestone for this industry. So we hope we’ve settled in now,” he muses. “And that there won’t be any more dramatic changes anytime soon. Both of these changes were very, very expensive.” Although he does express his concern for many “mom-and-pops” who could not afford the transition, he also knows, “You either have to stay in this game or fold. And we’re still in it.”

Truth be told, Malco has mastered every single transformation in our industry beginning with sound. Remembering “the second generation telling us about the impact of television and, even before that, the impact of radio,” Tashie has one suggestion to make. “If you want to know what happened to the small towns, watch The Last Picture Show. That movie shows better than anything the impact of television on the single-screen movie house which was the center of activity in every community.” On a good note, he has observed again and again that “once people get used to something and the novelty of it has settled in and then wears off, theatres became popular again…” Generally speaking, “the industry must always change and be ready to adapt to the competition that will certainly continue. We will always be in the crosshairs of some new way of providing content, be it Netflix, Showtime or HBO, online streaming, VOD... So our job is to create an atmosphere and environment with technology and good service. All the amenities that we are now offering in our theatres are far greater than we could have ever thought. We are now serving food in our auditoriums and offer beverages for adults. We have seats like those in first-class on a plane,” he observes. “We have done a lot to lure back in certain groups that we had probably lost along the way. This audience does come back if you provide them with the amenities that they like and that they are used to.”

Again, giving people what they like is nothing new when you have lasted 100 years in the business. “It was a seminal moment,” Steve Lightman recalls about another Durwood innovation. “Our first multiscreen was the Highland Quartet back in 1971. We thought Malco was the cat’s meow with our four 200-seat houses under one roof. I remember how this took the town by storm and, every weekend, we would sell out constantly. The whole city wanted to go to the Quartet. That was really the first shift from the singles and twins to the multiplex.” Part of its appeal was the location, he opines. “The Memphis downtown area, where all the palaces were, was getting antiquated and was not the safest at that time. It’s all coming back now and has revitalized,” he notes about today. That old style of single-screen or maybe twinned exhibition was “very inefficient,” he opines.

“Yes, the worst thing was if a film buyer made a mistake,” Lightman concurs and elaborates. “Then you were stuck with a flop in your theatre for months. What was the picture that played 60 weeks at the Paramount?” he asks before remembering The Sound of Music. “We lost that movie in Memphis and our opposition played it exclusive.” One can still feel the disappointment before he adds with a chuckle, “I don’t think our film buyer got a raise that year.” (For more on programming this year, see our conversation with Jeff Kaufman.)

“A long time ago,” Lightman continues his reminiscence, “we had another competitor at the Park Theatre who would get a few of the plums. It was really hard in the old days when you missed a big picture. Obviously, that does not happen nowadays.” About relationships with studios and the bidding process in general, he says, “It was a big fight back then. Everyone wanted the best pictures and while there might have been studio deals in other areas of in the country, Memphis was more of a free-for-all. When you didn’t get the good ones, you were hurt. That’s a great change from the old days. Not only do you get everything today, but you also get the films for three or four screens.” And you get rid of them a lot faster. “Well, you still want those 60 weeks,” Steve contends, “they just don’t come around any longer. The best thing is: No matter how many competitors you have, in most cities you still get a run of the picture. Except for some situations where two theatres are just too close to each other.”

What do the executives miss? Anything that was good in the past but is gone today? “Our industry is probably as efficient as it has ever been,” Lightman contends. “In my opinion, digital allows much more freedom in the individual theatres on how many shows one can have. You can change on a dime if you find out that you scheduled on the wrong screen.”

While he does not foresee “us ever running television shows” on those very screens, “we have had a huge success with the Metropolitan Opera here in Memphis. I probably received more compliments on that than for anything else we have ever done.” Remaining on the subject, Bobby Levy does not believe that alternative forms of content “will ever reach critical mass that is materially affecting the bottom line.” Nonetheless, he thinks that if licensing rights for sporting events could be obtained from the NFL or NBA, for example “we might actually turn some of these auditoriums into sports bars. You never know.”

“We plan on staying well on the cutting edge,” Lightman concurs. “You almost have to, to go forward in this industry.” Of all the innovations currently on offer–from moving seats to immersive audio, to variable frame rates and laser-illuminated projection–what will have the staying power to become the next new standard? “Jimmy always says, ‘Good stories are the key,’ and I tend to agree with him,” he adds. “It doesn’t matter how many gadgets you do at your theatres, you have to have good movies.” In terms of sight and sound, Levy suggests “we just wait and see what’s next. On the image front that we are dealing with now, it looks as if we are moving towards a laser light source. This will be better for us in the long term as an industry, we think. We will have a brighter picture and hopefully a long-lasting light. We are state-of-the-art people. If it is good, we want it.”

Segueing to sound, Levy observes, “With the brand recognition of Dolby attached, Dolby Atmos has a ‘wow’ factor for certain people. It is not yet as well known because it is only used with certain films. Once the format becomes more widely accepted, Dolby Atmos will really mean something.” In general, “the sound component is something that the public pretty much enjoys as part of the experience,” Levy opines. “We think of sound as being very, very critical to the full enjoyment.”

By contrast, he believes that high-end VIP offerings are totally market-driven. “Some areas are going to support this and others will not. Malco will offer this option for our guests where we think it will work. This is not for everyone, but there are those people who are looking for that special experience that exceeds anything that you can have in a more conventional venue. We know we have lost a certain audience, mainly the older generation who prefers to stay around the house. We also know that if you give them the right experience, those same people want to go out and enjoy it. They just don’t want to deal with all the hassles involved with big multiplexes. They prefer the boutique idea of having a seat that is reserved perhaps, and very comfortable. Maybe they want to order some gourmet food to enjoy with a glass of good wine–without having to worry about disturbances. All that is definitely very appealing.”

How about finding appealing locations for cinemas? After so many generations in the business, is this something that just comes naturally to the Malco crew? “First and foremost, the numbers have to work,” Levy replies, “but it is also very much a gut feeling that we have about a particular area.” “To be perfectly honest,” Lightman cautions, “we are seeing fewer and fewer areas and locations that look like slam-dunks. All those have been taken…”

Most importantly, Malco has always pursued a policy of keeping its real estate well updated, Levy explains. “If you have a theatre in a good spot and with ‘good bones,’ as we say, it is worth modifying and turning into a modern cinema with stadium seating and all the amenities. Every town we have operated in since the 1970s has a new cinema today,” he offers proof. “That’s what you do: You revisit your existing facilities and you upgrade them. If you do not, you have exposure [to another circuit moving in and taking away the business.] Malco is proactive in that respect and we get it done before someone comes in and can say, ‘They are ignoring their market.’ A lot of companies abandon their theatres, but we do not ignore a good market.”

The prognosis for growth in any of their markets is positive, everybody at the roundtable concurs. As members of the Malco and extended industry families, their outlook remains good. “In most cases, moviegoing is a social experience that people want to share,” Bobby Levy declares. “People are not going to like a good horror movie as much when they are sitting at home on their couch. Being scared together is more fun, laughing and crying together, getting out of the house–that will always be the attraction.” And that goes for the filmmakers too. “The big boys want to see their work play out in the theatre. They want to have their product shown under the best circumstances and in the ideal setting, which all of us here think our movie theatres provide.”

Even if exhibitors do their jobs well, external forces remain at play. “I don’t think any of those things will kill our industry.” Heading a company that has weathered 100 years of all kinds of highs and lows, Steve Lightman is clear in his assessment of the larger challenges today, such as windows, piracy and rising costs. “Obviously we do not like a shorter window and we are fighting right along with NATO and everyone else. We hope it doesn’t get much shorter and day-and-date on big pictures never comes.”

In describing “our biggest problem” as an industry, however, “I keep going back to what Jimmy said 30, 40 years ago; and my dad before him, some 50, 60 years ago: Good product solves a lot of this industry’s ills.” “The story is what drives people to want to see a movie,” Bobby Levy agrees. “We have been listening–for over 40 years around here at this table–to doom and gloom about this industry. When you are product-driven, that is exactly what you are waiting for–product. Every year we check and say, ‘Okay, looks like we have good stories here that will make some good movies.’ So, we know that the stories are there, it’s more about bringing them to the screen in a way that appeals to people… They just have to till the soil a little more, they need to find things of interest and nurture those stories.”