More Than Just Tentpole Movies Will Return To Theaters, Cinemark CEO Sean Gamble Predicts, As Windows Shift Cuts Risk

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Cinemark CEO Sean Gamble, like many in the exhibition trenches, is optimistic about the crop of movies headed to theaters in 2022, starting with The Batman next week.

During the company’s fourth-quarter earnings call with Wall Street analysts, he also suggested that a more diverse mix of titles will return to theaters as Covid continues to ease. That means more specialty and mid-budget fare — elements that have been lagging, in part because many older moviegoers have continued to steer clear of theaters for safety reasons.

“Even prior to the pandemic, we were beginning to see a little bit higher concentration of blockbuster films,” Gamble said when asked about the impact of that homogenization on Cinemark’s business. “Some of that was just the higher levels of risk that were starting to take place with regard to some of the smaller and mid-tier films. Interestingly, as you look at the environment today with a more dynamic window, even though some of the smaller and mid-tier films have reduced in volume.” That reduction, he added, is “partly because of the pandemic and partly because of some of the near-term dynamics with some of the streaming platforms.”

While Gamble didn’t delve into the economics, he was referring to a tighter window between theatrical and streaming, which enables distributors to consolidate marketing costs. “The actual risk factor associated with that has actually improved because of the more dynamic window,” Gamble said. “So I think there’s the potential over time that we may start to see more of the smaller and mid-tier films getting released theatrically, which could balance out the mix.”

The CEO conceded that it’s unclear where everything will shake out in the future. “There continues to be an evolution and things to sort out coming out of the pandemic in terms of just changing consumer behaviors, expectations, things of that sort.”

While Gamble’s view represents the glass-half-full perspective, the marketplace is presenting some stiff challenges for theatrical box office returning to pre-pandemic levels. In the fourth quarter, blockbusters like Spider-Man: No Way Home propelled the No. 3 U.S. theater circuit to its first quarterly profit since before the pandemic. Still, moviegoing has been more concentrated into a smaller number of blockbusters.

A majority of releases will have an exclusive window in theaters, Gamble predicted, though he noted that the No. 1 distributor, Disney, is taking a “wait and see” approach to theatrical. Along with other major studio parents like Paramount, NBCUniversal and WarnerMedia, Disney is keenly focused on building its streaming subscriber bases. The key variable in the marketplace will be the many smaller players with generally bigger financial stakes and upside in theatrical.

Under Gamble’s predecessor as CEO, Mark Zoradi, Cinemark had conducted several tests with Netflix and has been in talks with Apple and Amazon about playing their films. Army of the Dead had a nationwide exclusive for a week on Cinemark screens. Mention of pure streamers, who account for an increasing share of the talent market, if not the box office, was notably absent during this quarterly call.

Gamble was asked about mask requirements being lifted in many parts of the U.S. He said for Cinemark, mask mandates have not been a “meaningful” deterrent for customers, but fewer restrictions are clearly a plus. “People are pretty much going about their business,” he said. “But I certainly think that as overall mask guidance and requirements and recommendations continue to wane, that will be a positive overall in terms of people’s comfort level with going out, especially for people who have been more hesitant.”

Cinemark customer surveys have found that 75% of moviegoers say they are now comfortable being back in theaters, Gamble said.

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