Universal studios and AMC Theaters traded barbs Tuesday after the studio company hinted that it would release future films to both on demand platforms and movie theaters.

What happened:

  • NBCUniversal CEO Jeff Shell told The Wall Street Journal in a new interview that “Trolls World Tour” exceeded the company’s expectation for the film, earning about $100 million in revenue through digital sales.
  • Shell said Universal Pictures would release new films on digital release and in movie theaters once the COVID-19 pandemic ends. This means movies would be released in theaters and on demand (or possibly streaming) at the same time.
  • “Trolls World Tour” made just under $100 million in the three weeks. The film’s predecessor, “Trolls,” made $153.7 million during its theatrical run, as Deseret News reported.

How AMC responded:

AMC Theaters chair-CEO Adam Aron responded to the news, calling it “unacceptable,” according to The Hollywood Reporter.

  • Aron wrote: “It is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us with no choice. Therefore, effectively immediately AMC will no longer play any Universal movies in any of our theaters in the United States, Europe or the Middle East.”
  • Aron wrote: “This policy affects any and all Universal movies per se, goes into effect today and as our theaters reopen, and is not some hollow or ill-considered threat. Incidentally, this policy is not aimed solely at Universal out of pique or to be punitive in any way, it also extends to any movie maker who unilaterally abandons current windowing practices absent good faith negotiations between us, so that they as distributor and we as exhibitor both benefit and neither are hurt from such changes.” 

Universal responded to AMC:

Universal responded to AMC in a strongly-worded letter, saying:

  •  ”We absolutely believe in the theatrical experience and have made no statement to the contrary. As we stated earlier, going forward, we expect to release future films directly to theaters, as well as on PVOD when that distribution outlet makes sense. We look forward to having additional private conversations with our exhibition parters but are disappointed by this seemingly coordinated attempt from AMC and NATO to confuse our positions and our actions.”

What it means:

Reaction to the news divided into two camps. Several eye this as a potential sign of the shift from movie theaters to streaming. Others consider this a public display of negotiation between the two sides.

CNN’s Frank Pallotta wrote: “Have you ever known a couple who have really public fights and seemingly break up. Then, like, three weeks later you see them together and you’re like, “uh, didn’t you guys break up? That’s Universal and AMC right now.”

Forbes critic Scott Mendelson wrote: “Considering that Universal won’t have a new major movie in theaters (presuming “Purge 5” gets delayed) until the end of September (“Candyman”), and AMC may or may not be dealing with bankruptcy, there’s plenty of time for this “cold war” to be resolved over the summer.

  • It’s still moronic on AMC’s part. Over the next few years, Universal’s “big” movies will be as big if not bigger than Disney’s. By all means, try and get back onto solid footing w/out ‘F9,’ ‘No Time to Die,’ ‘Jurassic World 3’ and ‘Minions 2’ bringing in crowds to buy those large popcorns.
  • Comcast was arguably stating that “some movies will go to theaters and some will go PVOD.” That’s the future and has been since VOD/streaming took hold four years ago. Nonetheless, if Uni tries to do a day-and-date, then AMC can not play that movie on a case-by-case basis.”

Washington Post entertainment business writer Steven Zeitchik wrote: “Wish more of the reactions to AMC-Universal would get away from the ‘this is the end of theatrical movies’ angle and move more toward what it really is — saber-rattling in advance of a negotiation”

  • “Universal doesn’t want out of theaters (‘Trolls’ demonstrates just how much would be lost, no matter what spin they put on it) any more than AMC wants them out (those ‘Fast’ movies make bank, no matter what spin they put on it) so let’s slow our roll on all the paradigm-shift talk.”
  • “(And yes, there will be a negotiation after all this is over, one that will likely see theaters agree to shorten the window in exchange for a higher revenue share).”