A New Opening: Circuit CEOs discuss their plans for Saudi Arabia

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Cinemas Features

AMC Theatres made history on April 18 with the opening of the first cinema in Saudi Arabia in 35 years. FJI queried AMC’s Adam Aron and two other top exhibitors about their plans to operate movie theatres in this newly welcoming market.

Adam Aron, CEO

AMC Entertainment

Why did you decide to venture into Saudi Arabia?

We were first approached in the fall of 2017. This was all part of the vision of His Royal Highness the Crown Prince to transform Saudi life. Today, approximately 70 percent of the population in Saudi Arabia is under 30, and they are avid moviegoers, but until AMC opened its doors they had to watch movies at home or go out of the country. Now, for the first time in four decades, they can watch movies on the big screen in their own country. This was truly a once-in-a-lifetime opportunity, and we were thrilled that AMC could be at the forefront of helping the Crown Prince achieve his vision for his people.

How many theatres/screens do you plan to open in the kingdom this year? What’s the timetable? What are your plans beyond 2018?

We plan to open 40 to 50 theatres in 15 cities in the next four to five years.

What will be the typical screen count at your theatres?

It will vary depending on the building. Our first location, which is open now, will have four auditoriums and around 950 seats when all of the renovations are complete.

What kinds of deluxe amenities will your theatres have? 

We will have a variety of amenities and concepts that will vary from theatre to theatre and market to market, just as we do in the U.S.

What will be the initial ticket price? Do you see it going up?

Current ticket pricing is similar to New York City movie theatre prices. Closer to $20, but that does include a mix of taxes that are imposed on movie tickets in Saudi Arabia, just like there are taxes posed in many U.S. markets.

Will concessions play a major part in your revenues? 

Having a popcorn and Coke while watching a movie is universal and part of the experience of enjoying a film in a theatre with your family or friends. Saudis are no different.

Tim Richards, CEO

Vue International

Why did you decide to venture into Saudi Arabia?

We are continually exploring new markets. Saudi Arabia is home to one of the fastest-growing populations, with a young demographic. This growing population and demographic is an obvious attractive part of this market for us to explore.

How many theatres/screens do you plan to open in the kingdom this year? What’s the timetable?

For now we are focused on the immediate opportunities that exist rather than making announcements about finite numbers of screens and theatres that will obviously change and evolve as the business and industry does in Saudi Arabia.

What kinds of deluxe amenities will your theatres have?

Theatres in Saudi Arabia would be benchmarked on the world-class multiplex cinemas we own and operate internationally. They will of course be featuring best-in-class seats, screen and sound experiences at the very minimum.

So far, what are the biggest challenges of launching a business in Saudi Arabia?

We have found the Saudi Arabian authorities hugely supportive and helpful in supporting our efforts in setting up our operations in the kingdom. The pace of change has been unprecedented and there is a desire to move very quickly on all fronts. Our plans in the kingdom are the same as our other ten international markets...to be the best cinema circuit in each market and possibly not the biggest or the first.

In what ways will your operation in Saudi Arabia be different from the way you operate in other countries?

We have grown quickly across ten markets since inception and are accustomed to operating in new environments. As would be expected, we operate within the legal and societal context of each market.

What will be the initial ticket price? Do you see it going up?

Ticket prices are determined by various factors alongside the fact that we operate a dynamic pricing policy which sees prices reflect local market conditions and expectations.

How much of your programming will be Hollywood movies? What other countries will be part of your programming mix?

Our programming strategies always include a diverse range of content, from event cinema to local content. The scheduling of content is influenced by each market and our customers, alongside a number of other factors. It’s the choice of content and entertainment that grows admissions and brings new customers for incremental growth, so these decisions are led by technology, human behavior, customer demand and many more factors. It’s not just a case of Hollywood versus another.

Were you surprised that men and women sat together at the AMC opening in Riyadh?

No. The vision of Crown Prince Mohammed bin Salman will transform Saudi society and is already doing so.

Will concessions play a major part in your revenues?

Concessions play a big part in the big-screen experience overall. Our “future of retail” strategy is intended for all of the markets we operate in.

Do you expect to have any dine-in theatres?

We take pride in delivering a premium out-of-home entertainment experience with the best seats, screen and sound for the ultimate big-screen immersion. Part of this offer is to ensure there is minimal distraction and for our customers to be fully immersed in their chosen entertainment.

Hamid Hashemi

President & CEO

iPic Theaters

Why did you decide to venture into Saudi Arabia?

Saudi Arabia is the new frontier and land of opportunity for entertainment. Here is a nation, the only place in the world with an affluent, well-educated, English-speaking population of 32 million with a great appetite for entertainment. We offer a differentiated, affordable luxury experience and we believe the product will be well received by this market.

How many theatres/screens do you plan to open in the kingdom this year? What’s the timetable?

Our plan is to open some 30 locations over the next five years, some of which will open next year and possibly this year.

What will be the typical screen count at your theatres?

We plan on building theatres between eight to 18 screens, depending on locations and demographics.

What kinds of deluxe amenities will your theatres have?

Our theatres will feature all the amenities and creature comforts that we currently offer in the United States, with the exception of alcohol.

So far, what are the biggest challenges of launching a business in Saudi Arabia?

Aside from the typical challenges one encounters with starting a new business, there is the additional challenge of sourcing management and talent for a new industry that does not currently exist in the country. While we anticipate this initial challenge with sourcing talent, we also welcome it as an opportunity to establish a culture of hospitality and entertainment synonymous with our U.S. theatres.

In what ways will your operation in Saudi Arabia be different from the way you operate in other countries?

We obviously will adopt our concept to the market and be respectful of the traditions while at the same time be forward-thinking and bring a new experience to the Kingdom of Saudi Arabia.