EXCLUSIVE: Netflix is in preliminary talks with American Cinematheque to buy the venerable Egyptian Theatre on Hollywood Boulevard. This will become the first brick and mortar movie theater acquisition for Netflix. But sources said it would be wrong to eye this as the start of a move into the operational theater business.
This is a deal that sources place in the many tens of millions of dollars, and it will put Netflix in good standing with the Hollywood cinephile community as the disruptive streaming company helps to preserve one of Hollywood’s landmark movie theaters and its long tradition. It is also putting the non-profit American Cinematheque on firmer financial footing in the process.
Built by Sid Grauman in the early 1920s, the pharaoh-themed theater hosted Hollywood’s very first movie premiere in 1922. That was Robin Hood, the Allan Dwan-directed silent film that starred Douglas Fairbanks as the title character, Wallace Beery as Richard the Lionhearted, Sam De Grasse as Prince John, Enid Bennett as Lady Marion and Alan Hale as Little John. Established in 1981, the Cinematheque in 1998 completed a $12.8 million renovation and facelift to the theater.
The deal won’t impact Netflix’s ongoing relationship with independent theater chains that show its films like Landmark and Ipic theaters.
Both parties look at this as something of a partnership, sources said. Netflix will program its screenings for weekday nights while the Cinematheque runs screenings, lectures and occasional festivals on weekends on an autonomous basis. The organization will be able to expand its programming with the financial resources from this deal. Netflix will hold occasional special screenings and events for some of its splashiest movie launches. Cinematheque also will continue to run its screenings at the historic Aero Theatre in Santa Monica, on which it holds a 10-year lease.
Like most nonprofits, the Cinematheque has been cash strapped in recent years. The organization presents screenings of historic, rarely seen movies from the U.S and overseas. It is presently running a Film Noir week, with important filmmakers addressing overflow audiences.
The deal comes at a time when Netflix is eager to demonstrate its fealty to the film community during negotiations with the Academy over theatrical windows for awards contenders. It comes on the heels of Netflix’s most awards-successful feature film, with Alfonso Cuaron’s Roma winning three Oscars including Best Foreign Film and Best Director.
Netflix Chief Content Officer Ted Sarandos is a board member of American Cinematheque, and sources said he recused himself as this arrangement was voted on. The Netflix-Cinematheque negotiations will not be finalized until issues involving real estate and city permits are hammered out.