How coronavirus affects the movie industry

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The outbreak of coronavirus has dramaticly affected the movie industry: movies are made available at home the same time they are available in theaters.

The difference between a digital and a theatrical release is disappearing as theaters shut down. This could fundamentally change the leverage of studios in negotiations with theater chains, alter consumer behavior and significantly raise the bar for going out to the movies.

The closure of major theater chains across the globe is driving studios to break what is known in the industry as the window – the period of three months between as a movie hits the big screen, and as it has offered for video on rental or demand purchase, and later on streaming devices.

For years, many of the theater chains and studios have been locked in order to shorten the window: doing so would help studios be able to tap into awareness from a theatrical release and the value of theatrical marketing dollars be able to drive rentals or downloads. Until last week, the major theater chains in the world were so entrenched in their insistence on a window of three months in order to protect ticket sales, that they refused a window of one month to show ‘The Irishman’ of Netflix. Theater chains have resisted a push by the Warner Brothers of AT&T/WarnerMedia and the Universal Pictures of Comcast particularly to allow them to shorten that window for several films. However, in the present the theaters have zero negotiating leverage and studios are making moves so that they can bring their films to audiences.

Universal was the first studio to do these things. It announced on Monday that on the same day as their global theatrical release, it will make movies available at home, starting with Trolls World Tour, which had been planned to open on April 10 in the U.S. Three Universal films which had been in theaters before being closed.