The Weinstein Gamble

[Bornieo: Fully Loaded]

Originally Posted by innerSpaceman

Then how has Disney gotten around owning the El Capitan for the past two decades .... and pretty much showing exclusively Disney product?

I've wondered how they got around that law ... must be some clever loophole. But why are they the only ones to have pursued it? If anyone can shed some light, it's a subject I've been mildly curious about for some time.

It could be one of two thing. 1. They only show a percentage of Disney product, meaning 10% of the years releases go to another theatre in their district. In my area 10 years ago, we never got Paramount films because in a sneeky odd sort of way Mann is owned by Paramount, from what i understand. For a long time we didn't get Disney because of an "issue" between the studio and UA theatres. Or 2. Its Disney and they let them do what they want. It's money for Hollywood Blvd, Disney, and Pacific Theatres.

El Cap is what I can see and would want happening to other theatres someday.

[Alex]

Originally Posted by innerSpaceman

Then how has Disney gotten around owning the El Capitan for the past two decades .... and pretty much showing exclusively Disney product?

At least initially, Disney only owned 49% of the theater and Pacific Theaters owned 51%. But I think Disney owns it outright now.

It's quite possible that with the changes in the market that if a studio were to try and own a large chain of theaters that it would no longer be considered an issue. Theaters are no longer single screen affairs, there are generally mutiple methods of distribution and the rest of the production process is no longer vertically integrated.

In trying to find an answer as to why Disney can own the theater I see that the picture is muddier than I realized. According to a page at the Society of Independent Motion Picture Producers (an early organization that was behind a lot of the pressure that resulted in the 1948 antitrust decision; Walt Disney was a member) some law changed in the mid-80s (though it doesn't say what and I can't find it) that loosened theater-ownership rules.

Most of the major studios have since then been, at one time or another, a significant minority or controlling owner of theater chains. Universal at one point owned 49% of Cineplex Odeon. In '85 TriStar purchased Loews Theaters, merged with Columbia, was bought by Coca-Cola, was and was sold to Sony. Loews and Cineplex Odeon were then merged resulting in Sony owning 50% and Universal 25%.

So I guess it isn't true that the studios are not allowed to own theater chains any more (though I'm sure a major monopolistic style purchase would get quite a bit of regulatory review). That must mean that the reason they don't is that they generally don't want to.

The studios already get the vast majority of the box office receipts so all owning the theater gets them is the popcorn and soda profit (relatively pissant) and a lot of hassle. The full financial benefit would only be realized through monopolistic practices and in today's mega-multiplex environment it is hard to see those working (exclusivity and discriminatory pricing would be difficult when you have 18 screens to fill but only four movies in release).

Discriminatory pricing is still an ongoing issue, though. In Oakland the Grand Lake theater successfully sued one of the distribution companies for giving price discounts to the major theater chains (AMC in this case, I believe) that weren't available to the independents.

I'm assuming that if the Chinese wanted to show Santa Clause 3, that Disney would give them the same rental deal as every other theater chain.