Disney deal creates tremors
The motion picture industry as we know it is about to undergo one the most dramatic changes ever over the next five years. It all starts with the recent announcement of The Walt Disney Company’s acquisition of the film and TV studio and other properties of 21st Century Fox. The deal is pending regulatory approval that could take up to 18 months, and Disney is betting $66 billion that it will be approved by the Department of Justice.
The chatter in the industry is that the pact between these two giants will be industry-altering, a mega-merger reshaping the business and resetting the balance of power. In 2016, Disney and Fox together controlled 40 percent of the movie box office.
Over the next several months as this all gets sorted out, everyone will be talking about the ramifications of the deal. They are truly massive. Here are areas most likely to be affected:
* Exhibition will confront the possibility of onerous terms and less content.
* Fox Searchlight and other small independents will face great competition and possible hardship going forward.
* What will happen to the many top executives at Fox?
* How will rival studios react to the merger?
* And what happens to Fox Studios?
These are all questions that will be thoroughly digested, with commentary coming from the press, other studios, lawyers, theatre circuits and more. With the growing competition from Amazon, Google, Netflix and Facebook, the studio system is in for a great awakening. We see potential takeovers and mergers of Paramount, Lionsgate and Sony. How else will these companies be able to compete against the likes of the new Disney company and Warner Bros.?
The Disney takeover is truly about positioning the company to compete with the Amazons of the world and to acquire content to boost its own streaming service and surpass Netflix in this digital arena.
How big is big? Will the biggest companies continue to co-exist? Only time will tell, but we are going to experience mergers, acquisitions and consolidation like never before. Hold on tight—the ride is just beginning.
Virtual Reality Gains Traction
One of the more successful strategies for the survival of the movie theatre complex in this competitive age has been the effort to transform them into full-fledged “family entertainment centers.” You’ll find examples of this business approach around the country, from the installation of videogame arcade rooms to elaborate adjoining play areas where patrons can enjoy everything from climbing walls to laser tag to mini-golf.
Now, there’s a new diversion making its mark in movie theatre complexes: virtual reality. VR and AR (augmented reality) have achieved a degree of popularity with personal consumer helmets and devices, and now they’re becoming an added attraction at some of the world’s highest-profile cinema destinations. IMAX has been leading the way: The giant-screen pioneer has VR installations next to the popular Grove lifestyle center in Los Angeles and in theatre complexes in Shanghai, China; Manchester, U.K., and New York City. And it’s just opened VR centers in two high-profile venues: the Scotiabank in Toronto and the Regal E-Walk Stadium 13 & RPX in New York’s Times Square. At the E-Walk, virtual reality is playing a key role in the complex’s celebration of the blockbuster Star Wars: The Last Jedi. During opening week, not only did the latest Star Wars adventure play in every auditorium, Regal patrons could participate in two IMAX VR Star Wars experiences: “Droid Repair Bay” and “Trials on Tatooine.” So VR is already proving itself a symbiotic promotional tool.
“Droid Repair Bay” is also active at Cineplex’s Scotiabank Toronto location, along with seven other VR experiences, including three inspired by franchise movies: Justice League, John Wick and Star Trek.
In an interview in the January edition of FJI, IMAX chief development officer Rob Lister talks about IMAX’s pioneering VR initiative and notes that IMAX’s relationship with blockbuster filmmakers gives it a leg up in creating VR experiences that will complement their movies: “Being at the table in discussions about Justice League resulted in us being able to talk with the same creators and filmmakers about Justice League the VR experience. Having those relationships with studio executives and with filmmakers allows us to get involved at the earliest stage in terms of creating VR content around tentpole movies.”
Cineplex also recently brought “good vibrations” to VR with the debut of D-BOX’s VR concept at the Scotiabank Theatre Ottawa in Quebec. D-BOX’s approach combines seat motion and vibrations with virtual reality for the 12-minute animated adventure Raising a Rukus. “Our cinema-friendly proposal is appealing to many exhibitors,” says D-BOX marketing VP Michel Paquette. “We see a great opportunity for many more of these projects in the near term.”
All these signs point to VR becoming more of a reality at your nearby multiplex.