NATO (the National Association of Theater Owners), which represents such huge regional chains as Regal Entertainment and AMC, is threatening to drop some of this summer's biggest blockbusters in response to the recently announced Video-On-Demand plan that is being utilized by four of the six major studios.
Universal, Sony, Warner Bros., and Fox are set to release some of their biggest titles into living rooms across the country just weeks after their initial theatrical debut for a rental fee $30 per film. This was introduced in the US last month, with the Ed Helms's comedy Cedar Rapids being one of the first movies to lead the way.
Of course, theater owners are upset over this, as the diminishing window between a major blockbuster's cinematic distribution and its home video arrival has dwindled significantly. This means that theater owners will be losing an untold amount of revenue in the months and years to come. In retaliation, screens under NATO are threatening to boycott upcoming studio releases, starting with Warner Bros. sure to be box office-gargantuan Harry Potter and the Deathly Hallows - Part 2.
Some theater chains have even begun pulling promotional materials for films being released by the four major VOD supporters. But the studios in question aren't backing down. Sony's Just Go with It is set to make history by becoming the first major release to be offered through this new VOD service. Most theatrical movies are required a solid four month window between the time they are in theaters and the time they reach retailer shelves and VOD platforms. The studios believe that this is far too long to wait, and that it is hurting Blu-ray and DVD sales. The studios also hope that shrinking the video-on-demand window will reduce piracy.
Paramount Pictures has not joined the fray at this time, and many speculate that they will have the upper hand at the box office this summer because of their negative stance toward earlier VOD windows. The studio also has a strong slate of upcoming releases, which will make it one of the most lucrative studios of this fiscal year. Their schedule between now and August includes such sure-fire moneymakers as Captain America: The First Avenger, Transformers: Dark of the Moon, Kung Fu Panda 2, Super 8, and Thor.
Walt Disney Pictures is also not engaging in this new VOD platform, but they haven't been ruled out as a user of this new service. They simply have not yet revealed what they're going to do in terms of shrinking their video-on-demand window.
How do you, the theatergoer, feel about all these? Is this the downfall of American theater chains as we know them? Or will there always be room for a Cineplex in your town?
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