It looks like everyone is throwing their hats into the ring. When the studios announced a plan to release movies in home theaters just 30 days after the theaters located outside the home (with a price tag of $30 per rental), the National Association of Theater Owners balked. Apparently their threat to boycott big blockbusters was a fake, but they haven’t kept secret their disgust for the new model that would limit their ability to make money showing movies (since studios take the 50%-100% lion’s share of the ticket split in the first weeks).

Now, 23 directors and producers are speaking out against it.

That list includes James Cameron, Michael Bay, Kathryn Bigelow, Guillermo del Toro, Roland Emmerich, Antoine Fuqua, Todd Garner, Lawrence Gordon, Stephen Gyllenhaal, Gale Anne Hurd, Peter Jackson, Karyn Kusama, Jon Landau, Shawn Levy, Michael Mann, Bill Mechanic, Jamie Patricof, Todd Phillips, Brett Ratner, Robert Rodriguez, Adam Shankman, Gore Verbinski, and Robert Zemeckis.

The full, un-edited open letter is below:

AN OPEN LETTER FROM THE CREATIVE COMMUNITY ON PROTECTING THE MOVIE-GOING EXPERIENCE

We are the artists and business professionals who help make the movie business great. We produce and direct movies. We work on the business deals that help get movies made. At the end of the day, we are also simply big movie fans.

Lately, there’s been a lot of talk by leaders at some major studios and cable companies about early-to-the-home “premium video-on-demand.” In this proposed distribution model, new movies can be shown in homes while these same films are still in their theatrical run.

In this scenario, those who own televisions with an HDMI input would be able to order a film through their cable system or an Internet provider as a digital rental. Terms and timing have yet to be made concrete, but there has been talk of windows of 60 days after theatrical release at a price of $30.

Currently, the average theatrical release window is over four months (132 days). The theatrical release window model has worked for years for everyone in the movie business. Current theatrical windows protect the exclusivity of new films showing in state-of-the-art theaters bolstered by the latest in digital projection, digital sound, and stadium seating.

As a crucial part of a business that last year grossed close to $32 billion in worldwide theatrical ticket sales, we in the creative community feel that now is the time for studios and cable companies to acknowledge that a release pattern for premium video-on-demand that invades the current theatrical window could irrevocably harm the financial model of our film industry.

Major studios are struggling to replace the revenue lost by the declining value of DVD transactions. Low-cost rentals and subscriptions are undermining higher priced DVD sales and rentals. But the problem of declining revenue in home video will not be solved by importing into the theatrical window a distribution model that cannibalizes theatrical ticket sales.

Make no mistake: History has shown that price points cannot be maintained in the home video window. What sells for $30-a-viewing today could be blown out for $9.99 within a few years. If wiser heads do not prevail, the cannibalization of theatrical revenue in favor of a faulty, premature home video window could lead to the loss of hundreds of millions of dollars in annual revenue. Some theaters will close. The competition for those screens that remain will become that much more intense, foreclosing all but the most commercial movies from theatrical release. Specialty films whose success depends on platform releases that slowly build in awareness would be severely threatened under this new model. Careers that are built on the risks that can be taken with lower budget films may never have the chance to blossom under this cut-throat new model.

Further, releasing a pristine, digital copy of new movies early to the home will only increase the piracy problem—not solve it.

As leaders in the creative community, we ask for a seat at the table. We want to hear the studios’ plans for how this new distribution model will affect the future of the industry that we love.

And until that happens, we ask that our studio partners do not rashly undermine the current – and successful – system of releasing films in a sequential distribution window that encourages movie lovers to see films in the optimum, and most profitable, exhibition arena: the movie theaters of America.

We encourage our colleagues in the creative community to join with us by calling or emailing NATO at 202-962-0054 or nato@natodc.com.

Sincerely,

Michael Bay                 Stephen Gyllenhaal     Jamie Patricof
Kathryn Bigelow         Gale Anne Hurd          Todd Phillips
James Cameron          Peter Jackson              Brett Ratner
Guillermo del Toro     Karyn Kusama            Robert Rodriguez
Roland Emmerich      Jon Landau                  Adam Shankman
Antoine Fuqua            Shawn Levy                  Gore Verbinski
Todd Garner                Michael Mann             Robert Zemeckis
Lawrence Gordon       Bill Mechanic

Paid for by the National Association of Theatre Owners

The most crucial points here are 1) the long term failure of a model that throws out the baby with the bath water only to see the price of bath water go way down and 2) the threat of this increasing piracy instead of stemming it.

The first seems beyond a doubt to be correct, but the second is a bit harder to demonstrate (like almost everything concerning piracy).

Even if it is paid for by NATO – which means they, what, footed the bill for emailing it out? – it’s nice to see such a varied list of filmmakers speaking out against the model. They have as much of a dog in the fight as anyone here.

According to the press release, Karyn Kusama was quoted saying, “As someone who hopes to have the ability to keep making small movies alongside the opportunity to make some bigger ones, I am concerned by how much a shortened VOD window might affect a filmmaker like me. This shortened window might imperil the robustness, and challenge the already shrinking flexibility in programming, of the very venue that makes movie-making, and movie-watching, the work we choose to do.”

Of course, we can leave it to James Cameron to keep it poetic and to the point: “The cinema experience is the wellspring of our entire business, regardless of what platforms we trickle down to. If the exhibitors are worried, I’m worried.”

Are you worried?


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