By Alexis Colima
The release date of Universal Pictures, Trolls World Tour was set for April 10, and was launched onto online services such as Amazon Prime Video, iTunes and YouTube Movies for $20. With other studios following Universal’s lead, what would this entail for the future of movie theaters across the United States? The financial impact the coronavirus will leave on the entertainment industry, more specifically the movie theaters will be immense and not all will survive the fallout.
Ryan Faughnder of the Los Angeles Times writes the owner of AMC Theaters could file for bankruptcy protection Chapter 11 from creditors if closures persist. A written statement from MKM Partners analyst Eric Handler states, “Based on our view that theaters will be closed until at least August and out belief that AMC lacks the liquidity to stay afloat until that time, we expect the company will soon be faced with filing for bankruptcy.” Even with the government bailout funds being available to the copany, its debt of $4.75 billion is the final nail in the coffin.
A loan program from the National Association of Theatre Owners (NATO), passed through Congress was meant to keep movie theaters afloat. But it has since been “proven to be less useful than anticipated for businesses that are closed and can’t pay employees.”according to a NATO spokesperson to TheWrap, an online news organization focused on the entertainment business.
Many of the top banks from JP Morgan Chase, Citigroup and Bank of America have set a list of requirements that applicants must meet in order to qualify for the small business loan. Adam Bergeron, operator of San Francisco’s historic Vogue and Balboa theaters has faced some setbacks during the process of applying for a loan. In result of helping his employees file for unemployment benefits, he no longer meets the forgiveness requirement, for the loan to be forgiven 75% must be used on payroll. Which leaves Bergeron puzzled. “If I hire back my employees to use the loan on payroll like they want, do I just pay them for no work or do I bring them back to the theaters…which would be violating the social distancing guidelines the government wants us to follow?” The element of rent has also been brought into light with how quickly these benefits would reach small businesses before they go under.
An anonymous studio executive tells Vanity Fair, “AMC, Regal, companies like that, they’re in big trouble. Because of streaming, we’ve already set the table for people watching at home, but now we’re in a situation where there are not going to be any major movie events through the end of May. How are the theaters going to handle that?” With Disney’s Mulan, Jungle Cruise and Indiana Jones being released later than anticipated, other studios follow suit. Sony announced on March 30 that all summer films would be delayed until late 2020 or early 2021; Warner Bros. Announcing their delay of Wonder Woman 1984 to August 14 while pulling three movies from their original release date, In the Heights, Scoob and Malignant .On March 16 NBCUniversal announced its move to release their movies digitally the same day they were scheduled for release in theaters that remained open, Trolls World Tour, The Hunt, The Invisible Man, and Emma are available for 48-hour rental period for $20.
As an advocate for the at home movie theater, personally all of this seems inevitable and foreseeable with the way technology is. With more streaming services available and the appeal of watching a film in the comfort of your own home, it is no question to me that theaters and the movie industry will face this obstacle. Instead of subjecting yourself to the chance of meeting maddening movie-goers, the loud chewers, the uncooperative conversationalist, who insists that they can talk during the movie, whiney unruly preteens who are determined to leave a whirlwind of nachos and soda because someone else will clean it up. Staying at home and watching from your own device, or from a friends account seems to be the solution.