Are Canadian Movie Theaters Bound To Experiment With PVOD?

EXCLUSIVE: We heard some whispers around the holidays that a PVOD test in Canada was imminent with the major studios in the very near future, with theatrical titles available within a three-week window after their play in cinemas.

This is not true.

While talks have slowed between the major studios and leading Great White North theater chain Cineplex, we hear both sides are still far apart.

The PVOD conversation hasn’t stopped in the way that it has between AMC and the majors here in the U.S., but there’s still some big hurdles to get through before the video window becomes a reality in cities like Vancouver, Toronto, Edmonton or Montreal. Cineplex boss Ellis Jacob has a reputation for being open minded to the idea of PVOD, and as the movie one-stop shop in Canada for tickets and VOD rentals, it makes sense for the executive to be at the forefront of this newfound revenue stream. Cineplex has some 8,500 titles which is available to consumers via its own VOD portal. When reached for comment on this story, Cineplex provided none.

Essentially, the notion was for the majority of major studios to launch a test of PVOD in Canada, a controlled environment, with an evaluation following to determine if PVOD cut into theatrical ticket sales. However, to pull off this test, exhibition believes that it’s essential for Disney to be on board, especially if their titles are leading at the box office. Assuming everything on PVOD does well revenue-wise, exhibitors can argue that they always fared better with Disney films since they were provided a solid theatrical release.

Another point is that both Canadian exhibition and the studios can’t agree on the time length for the test: Word is Cineplex wants 2 years with a year period of evaluation and the studios want eight months with a four-month evaluation. Deadline has been informed that the biggest argument hasn’t been with exhibition’s percent share of PVOD monies.

Other disagreements: Canadian exhibition just wants one price point (reportedly $40 for the rental) not four to five different prices points as suggested by the majors.

“With MoviePass growing to 1.5 million subscribers, this PVOD thing could go up in smoke,” said one studio executive, “Who wants to pay $40 to a see movie three weeks after it’s in the theater when they can pay $9.95 a month to go as many times as they want? Consumers will soon figure this out.”

Added another, “In the end this PVOD experiment could damage the transactional video window more than anything else. At the end of the day, it’s just about shifting the same amount of money around.”

The other wrinkle for PVOD is that with big international players gaining yardage with exhibition (read UK chain Cineworld’s $3.6 billion deal to acquire Regal Cinemas, and of course Dalian Wanda’s interest in AMC), they’re not going to have any patience for any PVOD talk.

“With these big gun overseas players coming in, it’s not just about not playing a studio’s movie in the U.S,” says one industry player, “How about: We’re not going to play your movie on planet Earth?”