April 10, 2020
It’s a first for a big blockbuster release.
Trolls World Tour — the animated sequel to Trolls originally intended to premiere in movie theaters April 10 — instead heads directly and exclusively to premium VOD on the same day at a $19.99 rental price for 48 hours.
Well, almost exclusively — according to a Universal Pictures spokesperson, the film “will be playing at 25 drive-in theaters around the country, so clearly it’s not exclusive to on-demand.”
With movie theaters closing due to the COVID-19 crises, Universal Pictures and DreamWorks in mid-March elected to release the film simultaneously in theaters and on PVOD. Now, with theaters around the country closed, PVOD is getting the relatively exclusive premiere.
The sequel, featuring the voices of Anna Kendrick, Justin Timberlake, Rachel Bloom, James Cordon and Kelly Clarkson, among others, is a test case for PVOD.
Will the strategy pay off?
Richard Greenfield, co-founder/analyst with Lightshed Partners, discussed the move to digital delivery on CNBC’s “Squawk Box” April 9.
“It’s a pretty monumental day in the film industry where a mainstream consumer movie in Trolls is going to skip the theaters,” he said. “I give [NBCUniversal CEO] Jeff Shell and the team at Universal Pictures a lot of credit for being willing to try this. It’s a unique circumstance. A lot of the marketing dollars had already been set in motion for Trolls, but you got kids stuck at home, families stuck at home — $20 for Trolls, direct to consumer tomorrow, is really interesting. I’m certainly rooting for them to do well because I think this is an important model for the industry.”
Digital retailers are making the most of the unprecedented opportunity. FandangoNow, movie ticketing service Fandango’s digital retail site, is offering an “extended sneak peek” on Fandango.com and on the FandangoNow Extras YouTube Channel starting at 8 a.m. PT (11 a.m. ET).
Then, fans renting the film can participate in a 10 a.m. PT (1 p.m. ET) “Trolls World Tour Watch Party,” hosted by podcasters The McElroy Brothers (who provide troll voices in the movie),with commentary from the film’s director, Walter Dohrn, along with other talent and fellow fans on the official @Trolls Twitter page, using the hashtag #TrollsWatchParty.
“There’s so much excitement surrounding our first-ever Home Premiere pre-order that advance orders for Trolls World Tour are the strongest we’ve ever seen,” said FandangoNow head Cameron Douglas. “Families can’t wait to watch the reunion of the beloved ‘Trolls’ characters, while stocking up on DreamWorks Animation titles they can enjoy together at home.”
Vudu, too, has a “Trolls World Tour Watch Party” scheduled for 3 p.m. PDT (6 p.m. EDT), preceded by a half-hour “virtual red carpet pre-show,” accessed through Twitter, with movie trivia, influencer interviews and favorite character talk.
Analyst Greenfield questions whether consumers will return to theaters as stay-at-home orders lift.
“What happens when the theaters reopen, and people really don’t want to go to them?” he said. “Is there a model where your Peacock subscriber (or Disney+, HBO Max, etc.), do you try to market movies at a $20 or $30 premium? You could think of it like ‘NFL Sunday Ticket.’ You had to have DirecTV to get it. Or UFC. You can’t get UFC streaming unless you are an ESPN+ subscriber. It’s possible you move to that model; the PVOD model is certainly possible. But you are already limiting the person who can see it. Anyone can see it in a theater. If you limit the universe just to people who are just Disney+ subs, you do run the risk of just not being able to reach as many people as you otherwise would have reached. So, [PVOD] is an idea. All the studios are trying to figure it out.”
He noted that social distancing in a theater drops capacity significantly.
“Our core business of putting people in theaters for decades, it’s not clear when hundreds of people are going to feel comfortable again in a movie theater,” he said.
Subscription VOD is a beneficiary of the crisis as well, he said.
“Consumers want to stream a lot of content, and the pandemic is just accelerating that trend,” he said. “Can you wait for movie theaters to do $1 billion for a movie like Mulan, or do you with a base of 50 million for Disney+ (maybe 70 million, 80 million by the end of the year), you say, ‘You know what. We have to change the model, use this Disney+ far more aggressively to get content out to the consumer.’
“It will be really interesting to see if [new Disney CEO Bob] Chapek has the guts and boldness to shift Disney’s business model. Or [say], ‘Hey, we got a lot more subs, and it’s still a small part of overall business model.'”
Certainly, movie theaters will put up a fight.
Interestingly, just about a year ago in February 2019, Cinemark CEO Mark Zoradi said Hollywood studios were no longer talking about creating a premium video-on-demand window for popular movies, according to a story from The Hollywood Reporter.
“PVOD isn’t even discussed anymore,” Zoradi told the Morgan Stanley Technology, Media & Telecom Conference in San Francisco.
Additional reporting by Erik Gruenwedel.