Video on demand: Future of movie industry?

September 5, 2020
by Wyatt Ashlock, Staff Writer

September 5, 2020

The global pandemic has had many unforeseen consequences throughout the world, one of which was the change to the film industry. COVID closed the theaters in early March, canceling the premieres of big name movies such as “A Quiet Place Part II,” “Black Widow,” “Wonder Woman 84” and many other titles. Other films, like “Scoob,” “The King of Staten Island” and “The Invisible Man,” canceled their theatrical run all together and opted for a video on demand release.

Movie studios make an 80% profit on sales with video on demand compared to the 60% that the studios earn in the theaters. The price of a video on demand viewing experience is typically lower than the price of a movie theater experience. New movies that are video on demand exclusives cost about $20.00, but these are typically 24 hour rentals. AMC movie theaters usually charge $12.49 for a ticket, $8.79 for a large popcorn and $6.29 for a large drink.

While these numbers do show that video on demand is much cheaper, some movie theaters do offer an alternative to the typical viewing experience. For example, AMC Theaters offer A-List, a subscription for the movie-going experience. An AMC A-List subscription costs $20.00 a month, offering three movie tickets a week for a full month along with 10% off concessions. While A-List is a good deal for single people, like college students, whole families would benefit more from video on demand prices.

Another aspect of this debate is that video on demand releases go straight to streaming services such as Amazon Prime and Vudu. These streaming services are also releasing movies that still have the big budget that cinema films receive exclusively to their own services.

“Justice League: The Snyder Cut” received a $30 million dollar budget, and it will release exclusively on HBOMax. Disney has pulled the live-action “Mulan” from the theatrical line up and has decided to release it on Disney+ Premier Access. “Mulan” will cost an additional $30.00 with the $6.99 subscription fee for Disney+. If someone purchases “Mulan,” they will own it only while they keep their subscription active. If the subscription is canceled, they will lose access to the film.

“We thought we would give it a try to establish a new window of premier access, to try to recapture some of that investment,” Bob Chapek, CEO of Disney, said. “We’re going to have a chance to learn from this and to see whether that makes sense.”

“Mulan” will be a Premier Access exclusive for about three months before being accessible to all Disney+ subscribers. If all goes well, Premier Access may become a standard for Disney+.

As another movie giant, Universal has stated that when theaters reopen they will continue to release movies to video on demand after screening them exclusively in theaters for 17 days.

The future of movies is changing right before our very eyes and with the industry adapting to new ways of releasing, people must stay vocal on what suits them and what does not before things become set in stone for the future. Drive-in theaters are the past, movie theaters are the current, and streaming video on demand is the future.

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