• by Wayne Friedman , Staff Writer, December 1, 2016

First-run movies coming into your home -- and this time movie studio companies mean it. Theater owners, what say you?

Movie studios have flirted with the idea before of releasing movies on TV systems' VOD at the same time as their theatrical release. But movie theater owners have resisted --in a big way.

Haven’t we heard something similar when TV networks were in the early days of delivering their content digitally via their owned apps/platforms -- all to the chagrin of their traditional distribution partners?

Now, in many of these digital areas, TV networks have had tussles with  TV affiliates. The results? A queasy relationship where TV station can get an  advertising-share arrangement for new digital TV offerings -- all in the hope of TV stations perhaps promoting those new businesses.  

How have TV stations been faring with these arrangements? Any big winners so far?

Pay TV operators get other kind of incentives.  Many new TV network carriage deals with traditional pay TV providers are linked with new OTT efforts such as DirecTV Now and Sling TV.

Movie studios believe they need to play catch-up.  Kevin Tsujihara, chairman/chief executive officer of Warner Bros. Entertainment, says it’s “imperative” first-run movies come into the home soon because consumers “clearly say they want it.”  In part this is because it’s where “all the pirating is occurring.”

James Murdoch, chief executive officer of Fox, was even more adamant back in September at a theater owners conference concerning existing economics. He called it “crazy” that theater owners insist on exclusives to movies for the first 90 days.

Surely theater owners appreciate that kind of nice business talk.

All this begs the question: What can studios offer theater owners? Certainly not advertising-revenue-sharing arrangements. Maybe a share of the digitally delivered box office revenues in each market?

And what would theater owners do for their part of that negotiation? Maybe run TV commercials in their theaters touting such digital platforms as a form of promotion for the upcoming movie?  

Not so fast. Is that your prospective customer consuming that message while in a comfortable movie theater seat? Don’t you want him to come back?

No doubt there are other issues. No matter. Movie studios need to figure out a financial model for local entertainment -- on the retail level. It’s imperative.