AMC Theaters and Direct-to-Home Releases

AMC Theaters announces Universal films will no longer be shown in any of their locations

The CEO and president of AMC Entertainment Adam Aron announced in a press release on Tuesday, April 28 that “AMC will not license any Universal movies” in any of their locations across the globe. Aron stated that this change was due to Universal Studio’s decision to release the Dreamworks animated motion picture Trolls World Tour on services like Apple TV and Amazon Prime via digital rental. The switch to a direct-to-home release was made because of theaters and entertainment venues closing in an effort to stop the spread of COVID-19.

Three weeks after its release, Trolls World Tour made over $100 million in rental sales according to an article by The Wall Street Journal. The film also broke the record for the most successful opening weekend for a video-on-demand digital release which was previously held by Jurassic World: Fallen Kingdom. With its staggering success, many are worried that the influence of direct-to-home releases could threaten the entertainment and movie theater industries. Aron says that “this radical change by Universal to the business model that currently exists between our two companies represents nothing but downside for us and is categorically unacceptable to AMC Entertainment.”

The entertainment industry has been hit especially hard since the outbreak of COVID-19. If movie theaters in the U.S. remain closed through July, they will lose $4 billion according to an article by Forbes from March 11. Owners of movie theater venues and other businesses requested bailouts from the government less than a month into the pandemic. Movie distributors like Disney and MGM have had to push projects like Black Widow and the latest James Bond entry No Time to Die back to late 2020 or early 2021.

The COVID-19 pandemic has disrupted the fabric of our modern world. Causing companies to make drastic decisions to stay afloat. Other members of these industries aren’t always taken into account and tend to suffer from these choices. All of these factors will affect various industries for years to come and AMC’s decision is just one of many that are happening every day.