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Indie Theater Group Blasts 'Screening Room' Premium VOD Concept

15 Mar, 2016 By: Erik Gruenwedel

An organization representing 600 independent move theaters (except Landmark Theatres) March 15 issued an open letter in protest to proposed plans by Napster co-founder Sean Parker to launch a $50 premium VOD service dubbed Screening Room, offering simultaneous in-home rental access to new theatrical releases.

The Art House Convergence said the proposed VOD service would devalue the theatrical experience and enable increased piracy — the latter a hallmark of Napster’s infamous origins in 1999 that significantly altered the music industry forever. The AHC also questions the economics of the proposed revenue-sharing model that would give $20 per VOD transaction to theaters.

“Sean Parker’s previous experience in media-sharing ushered in piracy, unintended as it may have been, which was highly damaging to the music industry,” AHC founding director Russ Collins said in a statement. “So, it is natural that we are suspect of his ability to guard against that in this incarnation.”

Tim League, founder of Alamo Drafthouse Cinema, a chain of 20 theaters nationwide, said Screening Room would undermine its relationship with studios.

“We’re both trying to build large audiences for the movies they finance. I see adoption of this technology and the piracy threat it presents as a grave disservice to that partnership,” League said.

Parker and Prem Akkaraju, an executive at SFX Entertainment, are reportedly seeking studio support for a premium VOD reboot that would have users pay $150 for a proprietary set-top box (for security purposes) enabling access to new theatrical titles over a 48-hour window.

Premium VOD seemingly died in 2011 when Universal Pictures killed plans to offer Eddie Murphy ensemble comedy Tower Heist, in the home for $60, three weeks following its theatrical debut after theaters threatened to boycott the movie.

In the letter, the AHC said it is not seeking to debate the day-and-date concept offering new-release theatrical releases simultaneously in the home entertainment window. Instead, the group says Screening Room could mark the end of the cinema market and greatly enhance the threat of piracy.

The group said most of its theater members have in recent years absorbed upwards of $100,000 in conversion costs per screen in order to comply with Digital Cinema Initiatives aimed at thwarting theatrical piracy.

“If studios are concerned enough with projectionists and patrons videotaping a film in theaters that they provide security with night-vision goggles for premieres and opening weekends, how do they reason that an at-home viewer won’t set up a $40 HD camera and capture a near-pristine version of the film for immediate upload to torrent sites?”

Yet, Variety reported that more than 1,200 respondents (26%) to an online poll said they would pay $50 to watch a new-release theatrical title in the home.

"Lord of the Rings" director Peter Jackson has come out in support of Screening Room, which is also reportedly supported by directors Steven Spielberg, Ron Howard, Brian Grazer, Martin Scorsese, Taylor Hackford,  Frank Marshall and J.J. Abrams.

In a statement, Jackson said he believes that unlike premium VOD efforts in 2011, Screening Room is targeting consumers who don’t normally go to the movies.

“Screening Room will expand the audience for a movie — not shift it from cinema to living room. It does not play off studio against theater owner. Instead it respects both, and is structured to support the long term health of both exhibitors and distributors — resulting in greater sustainability for the wider film industry itself,” Jackson said.

Regardless, the AHC said Screening Room is an idea that should remain shelved.

“At this time, and with the information available to us, we strongly encourage all studios to deny all content to this service." 

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