March 18th, 2021: AMC Entertainment Holdings had climbed all the way out of the abyss brought on by COVID-19 and the various lockdowns around the United States. Essentially saved by Main Street USA redditors who campaigned for the stock using slogans about tendies and rockets to the moon, AMC had been given the lifeline it needed to make it until the end of 2021. Bankruptcy would just have to wait. The leading cinema company in America, the company had made it to the other side of the pandemic – the other side of the rise of online streaming. Its stock rose to $14 per share, it announced its theaters would all be reopening, and a new slate of movies were on the way with vaccinated customers ready to return to normalcy once more.
March 23rd, 2021: The Walt Disney Company announces its slate of films are being shifted, with many of its tentpole blockbusters now having dual launches on Disney+. Movies that were scheduled for release in the near future are moved back once more, Black Widow being the most significant. The Summer of Return for movie theaters had essentially been cut off at the knees, and movie theaters that were ready to rise from the ashes were thrown back into the fire. By the next day, AMC Theatres had dropped back down to $9.04 per share — a 36% drop in value in 24 hours.
But why? Why did Disney make such a change considering that vaccinations in the United States are continuing at such a rate that moviegoers should be ready to go to those movies?
Consider that in 2019, The Walt Disney Company owned the box office with all top six grossing films for the year crafted or beneficial by the House of Mouse. It’s been like this for years. In 2019, Disney won with Avengers: Endgame (Domestic Gross: $858 million), The Lion King (Domestic Gross: $530 million), Toy Story 4 (Domestic Gross: $432 million), Captain Marvel (Domestic Gross: $426 million), Spider-Man: Far From Home (Domestic Gross: $388 million), and Aladdin (Domestic Gross: $354 million). Only Spiderman featured any other name besides Disney, and even it was a part of Disney’s Marvel Cinematic Universe. So why would Disney kill a revenue stream that garnered over three billion dollars in 2019 domestic alone?
Well, for starters, we believe because they had to share it.
You see, Disney and other filmmakers have to share their profits with those dastardly theaters. And AMC is the largest of those theater chains. In the age of social distancing, however, Disney has been making a play to take on Netflix for the champion of streaming services. There’s huge money and leverage at stake. And there’s no middleman in streaming, other than the internet service provider. There are other benefits to streaming your own content without the need of a third party theater chain.
Those theater chains report profits and revenues. In return, the revenues of movies in American box offices are precisely known by the public. While that can be advantageous, it can also be a stumbling block for movies that underperform. Why not get the best of both worlds and be able to present the data however you wish because it’s only really known to your company? That’s what being a streaming platform allows. And even better, because you have a steady amount of subscription fees coming in, you can protect some of your content that would otherwise be lackluster by simply offering it for “free” as part of the normal revenue. Then you put the really good stuff up on your service for the same cost as taking the whole family to the movies before… except now they’re in their own homes, watching exactly what you want them to watch. There are no more previews for competing films. There are no more concession stand ads. Just a cool, hard thirty bucks dropped down by the consumer on top of a subscription fee they’re already paying.
For Disney, it’s a lucrative plan. For the consumer, it’s all in their hands.
You see, this only works if consumers buy into it. If consumers abandon theaters and stay at home, paying exorbitant prices without the overly-salted popcorn bucket, then the cultural experience of going to the movies will cease to exist. If consumers go to the movies in spite of the government and corporate attempts to kill the century old piece of Americana, well then they might just get their second lifeline after Reddit gave it the first. Unlike the switch from horses to cars or from landline phones to cellular devices, the potential loss of movie theaters will be one without an equivalent or improved replacement. Instead, we’ll simply have a social experience gone from the current and future generations. In its place will be more sheltering in place as we continue to evolve away from real communities and into online tribes.
Let’s hope Disney loses this one, if only for the overly-salted popcorn buckets.
Pirates & Princesses (PNP) is an independent, opinionated fan-powered news blog that covers Disney and Universal Theme Parks, Themed Entertainment and related Pop Culture from a consumer's point of view. Opinions expressed by our contributors do not necessarily reflect the views of PNP, its editors, affiliates, sponsors or advertisers. PNP is an unofficial news source and has no connection to The Walt Disney Company, NBCUniversal or any other company that we may cover.