Meet Michael Lambert, one of the key investors in and vice chairman of Rave Cinemas LLC. “There are tremendous opportunities for exhibition in the future. It’s a very exciting time,” he declares. “The rebuild into stadium seating has made the theatre experience vastly different than it used to be. No more walking into a flat or sloped-floor auditorium with chewing gum on the floor and you couldn’t see past the person in front of you. It’s just a very different experience today in digital sound and picture clarity, in the quality and variety of food offered at the concession stand: There’s a lot that makes it fun!”
In Rave’s chief executive officer Tom Stephenson, he has found “just a terrific, innovative operator” to have all that fun with. “He’s just one of the few really aggressive, entrepreneurial and enthusiastic exhibitors. The theatrical business has many sort-of sleepy companies that are not innovators and are not reinventing themselves.” The Rave theatres, by comparison, Lambert finds to be “really beautiful, exciting, bright and colorful environments that have great energy. They are all digital, have 3D everywhere and all the other state-of-the-art picture and sound features, fantastic seats…that’s what got me excited about the deal.”
The founding partner of investment and management company Lambert Media Group began his career in 1974 when he joined Viacom in New York City to help launch the Showtime and Lifetime cable networks. His responsibilities there included the acquisition and sale of motion pictures for theatrical distribution, broadcast and cable television. The latter segments remained the focus of his executive career, with positions at HBO and with 20th Century Fox Domestic Television in Los Angeles, from 1985 to 1992, when he formed Lambert Television.
From then on, Lambert partook in what his official biography calls “several highly successful entrepreneurial ventures in media and entertainment,” many in partnership with Norman Lear and the late Hal Gaba. The 1997 sale of Lear’s Act III Theaters to KKR Kohlberg Kravis Roberts & Co. gave him his first brush with theatrical exhibition, though Lambert readily tells our readers: “By no means was I the architect of the deal. I began my entrepreneurial career with two fantastic men who later became my business partners and friends.” For those of us who don’t recall the details, Act III changed hands to a record 11 times forward earnings, resulting in a return of nearly $300 million on $18 million initial invested capital. Quite a start for getting into the movie theatre business.
In addition to Lambert’s television assets, today the Media Group also holds investments and ownership stakes in other content providers such as Concord Music Group (5,000-album catalog) and Village Roadshow Pictures (which co-produces and co-finances six to eight movies annually). Further on the theatrical side, Lambert invested in Gold Class Cinemas. Over the next five years, the joint venture between Village Roadshow Ltd., Act III Entertainment and Lambert Media Group plans to have over 50 premium luxury locations across the U.S.
Calling upon his knowledge of all aspects of content distribution, Lambert has “a much different view” about showing films in movie theatres than as double loss leaders for theatre operators to sell popcorn and for studios to market their films for ancillary revenues. “I think the exhibition business probably stands alone as one of the remaining parts of the media mix which is not being dis-intermediated by other technology,” he explains. “In other words, we are seeing a slicing and dicing of viewing content on various screens for personal use by the consumer. Whether that be laptops, the iPhone, PCs or flat screens in the home, the windows are changing and the availability of content is becoming more consumer-driven.” Going to the movies, by comparison, “is unique and not a victim in the same way as these other distribution forms are. So my view about wanting to play in the content distribution business is that exhibition is the best way to do it.”