AMC, Universal Strike Landmark PVOD Distribution Deal

Universal Film Entertainment Group and AMC Theatres July 28 announced a landmark distribution deal for the studio’s new release movies, which includes provisions for early debuts into the home on premium VOD.

The deal allows Universal, which has aggressively launched movies into retail channels via PVOD during the coronavirus pandemic — creating an acrimonious rift with the nation’s largest exhibitor, AMC, and others — to distribute titles on PVOD three weekends (as little as 17 days) after their initial bow in AMC Theatres. The agreement, which also includes new titles from Focus Features, will afford early consumer access via AMC Theatres On Demand. In the coming weeks, the two companies will begin discussions surrounding international distribution agreements in the countries in Europe and the Middle East served by AMC.

The typical theatrical window has been up to three months. AMC will split the $20 PVOD fee with Universal in return for the abridged window. The agreement does not include the typical retail window when titles are rented and sold from $3 to $6 through myriad digital channels such as Redbox, iTunes, Amazon Video, Google Play and Movies Anywhere.

Universal’s traditional windows for electronic sellthrough and video on demand (VOD) remain unchanged. The companies said they reached this agreement based on their “shared commitment” to a mutually beneficial long-term partnership that is focused on serving consumers worldwide, while preserving and enhancing the theatrical experience.

As a result, the deal means when the next “Fast & Furious” installment, F9, hits theaters April 2, 2021, Universal could give consumers the choice to either see it in the cineplex or wait a few weeks to buy or rent it.

“The theatrical experience continues to be the cornerstone of our business,” Donna Langley, chairman of Universal Filmed Entertainment Group, said in a statement. “The partnership we’ve forged with AMC is driven by our collective desire to ensure a thriving future for the film distribution ecosystem and to meet consumer demand with flexibility and optionality.”

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Peter Levinsohn, Vice Chairman and Chief Distribution Officer of UFEG, who led negotiations on behalf of the studio, said the studio’s commitment to innovation in how it delivers content to audiences is what artists, partners and shareholders expect of Hollywood.

“We are excited about the opportunity this new structure presents to grow our business,” Levinsohn said. “We are grateful to AMC for their partnership and the leadership they have shown in working with us to reach this historic deal.”

AMC CEO Adam Aron, who said the chain “enthusiastically embraces this new industry model,” said the deal puts a premium on the long-term health of the exhibition industry.

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“We would note that just as restaurants have thrived even though every home has a kitchen, AMC is highly confident that moviegoers will come to our theatres in huge numbers in a post-pandemic world,” Aron said. “As people enjoy getting out of their homes, we believe the mystical escape and magical communal experience offered at our theatres will always be a compelling draw, including as it does our big screens, big sound and big seats not to mention the alluring aroma of our perfectly prepared popcorn.”

AMC is planning to reopen about 600 U.S. theaters in August.

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