The Hollywood Reporter - 31.07.2019

Behind the Headlines

The Report

THE HOLLYWOOD REPORTER 14 JULY 31, 2019

POPCORN: ISTOCK. FENG: VCG/VCG VIA GETTY IMAGES.

-$8M

to

-$8.7M

$41.9M

$12.3M

to

$15.2M

$304.6M

-$46.9M

to

-$47.9M

$40.2M

$69.8M

to

$89.8M

$200M

Pitch

Program Regal Unlimited

Regal’s plan gives theatergoers an unlimited

number of movies per month in standard

format at many or all 549 locations across the

country, depending on the tier.

There’s Regal Unlimited ($18 per month for

access to 200 theaters in smaller markets),

Unlimited Plus ($21 for access to 400 theaters)

and All Access ($23.50, access to all theaters).

A 10 percent discount on concessions and

nonalcoholic drinks.

A one-year commitment, 50 cent fee per ticket

and upcharge for premium format.

$20 to $24 a month, depending upon the

moviegoer’s location. (L.A. and New York are

$24, of course.)

A 10 percent discount on concessions.

Subscribers must sign up for a

three-month commitment.

$9-$10 per month. (Slightly higher than the

current average movie ticket price of $9.16,

but lower than in some big cities where tickets

can cost $17 apiece.)

$9-$10 for extra tickets throughout the month,

plus a 20 percent discount on concessions.

Subscribers may pay an upcharge for a

premium format.

Subscribers — more than 850,000 since its

June 2018 launch — get three movies per

month in any of 661 locations and in any for-

mat, including Dolby Cinema and Imax.

Subscribers get one 2D, standard-format

movie a month; unused tickets roll over to the

next month. Launched in December 2017,

the program has 700,000-plus members.

AMC Stubs A-List Cinemark Movie Club

Price

Perks

Restrictions

Wanda Pictures Huayi Brothers Enlight Media Huace Film & TV

M

oviePass may be on its last legs, but its legacy lives on. The last of the largest U.S. theater

circuits, Regal Cinemas, unveiled its subscription plan July 29, and it’s more aggressive than

those of AMC Theatres and Cinemark, allowing “members” to see as many titles as they

desire. But the verdict is out on whether these plans will pay off. Analyst Eric Handler of MKM Partners

prefers Cinemark’s: Members get one ticket a month, plus deep discounts. “Cinemark will make money

every single time,” he says. “For AMC and Regal, you want people to go to the movies, but you don’t want

them to go too much. If they go more than three times a month, you are losing money.”

Both AMC and Regal are betting that subscription plans will help turn out audiences weekly,

while Cinemark offers value for the once-a-month viewer BY PAMELA MCCLINTOCK

Theater Chains Go MoviePass:

How ‘Membership’ Stacks Up

China’s Major Studios Facing ‘Desperate’ Cash Crunch

A

fter years of breakneck growth, China’s film sector is in the grips

of a contraction. Among the 12 most influential publicly traded film

companies in the country, all but one said in July earnings reports that

they expect profits to fall or crash into the red. The carnage includes a

55 percent to 65 percent profit decline at Wanda Film Holding Co., a profit

crash of more than 200 percent at pioneering studio Huayi Brothers

Media, and even a 253 percent slide into losses at Beijing Culture, the

hit-making studio known for all-time box office champion Wolf Warrior 2.

Last year’s abrupt crackdown on tax evasion in the industry — which

ensnared actress Fan Bingbing — has been followed this year by an aggres-

sive tightening of censorship control, leading to the surprise

cancellation of more than half a dozen pricey and high-profile

film releases. By far the hardest hit, Huayi Brothers has seen its

past three tentpole films — Feng Xiaogang’s Cell Phone 2, the

$80 million war epic The Eight Hundred and A Tiny Little Wish

— all blocked from release over content issues.

The fear in the industry is that political disfavor is spooking investors and

making new film financing very challenging. “Most major Chinese production

companies are desperately searching for investment,” notes one high-

level Hollywood financier whose business extends into China. Legendary

Entertainment, owned by Chinese conglomerate Dalian Wanda Group, held

talks with Tom Barrack’s Colony Capital over a minority stake, Bloomberg

reported July 28. Because China has yet to adopt the slate financing model

common among U.S. studios, local film companies tend to court outside

investors on a picture-by-picture basis. The recent ugly political optics

surrounding the film sector have resulted in “much less money flowing into

production,” notes the investor. “The government has inadvertently severely

limited the capital flow into the motion picture business in China.”

Amid a new censorship crackdown, nearly all public film companies warn of sharply declining profits BY PATRICK BRZESKI

55%-65% 217%-219% 95%-96% 119%-121%

Source: Company filings; current exchange rate of $1 to RMB 6.89 used for all conversions. H1 is first half of financial year.

H1 2018 PROFIT H1 2019 PROJECTED PROFIT Feng