Ster-Kinekor Kinekor and Nu Metro shrug off on-demand streaming and remain confident people will return to movie theatres 

BL PREMIUM 

07 June 2021 - 19:00 Katharine Child

Moviegoers wearing protective face masks wait to watch a film at a cinema. Picture: MILAN JAROS/BLOOMBERG 

The death of cinema has been predicted for decades. First television was going to kill it, as audiences could watch their favourite stars at home for the first time without the big screen. Next it was said that videocassettes, DVDs, satellite television and PVR, which allow television recording, would keep people from going to the movies. 

Then on-demand streaming of content such as Netflix and Amazon Prime was the final death knell as people could binge watch from the comfort of their couches. 

If that was not enough, the global Covid-19 pandemic forced people into their homes and put US movie production on hold. This meant there was little to draw in audiences as lockdowns relaxed. 

Nevertheless, the industry believes film will live on as it always has.

Ster Kinekor acting CEO Motheo Matsau says he doesn’t want to sound arrogant, but the film industry has faced pandemics and two world wars and “has always found a way to be innovative and survive”.

He says this even while his company is undergoing business rescue, a process designed to keep creditors at bay, while practitioners try to draw up a plan to save the cash-strapped firm.

But why go to the movies when you can stream content at home and make popcorn costing at least 10 times less than the theatre?

Both local cinema companies, Ster Kinekor and Nu Metro, say they do not see on-demand video streaming such as Showmax or Netflix as their primary competition.  

Instead, going to the movies competes with other entertainment experiences such as going to a party, the theatre or eating out at a restaurant. 

Matsau says: “You go to the cinema to experience something.” 

Being able to download music led to the death of the CD and stores that sold them such as Musica, which shuttered its final stores last month. But music on demand has not ended rock concerts and music festivals.

Chantelle Brown, marketing and content executive at Nu Metro Cinema, says: “If an analogy had to be found, cinemas would fit more within the same arena as live music events.”

Another reason for the local industry’s optimism is international research showing that people who stream a lot of content at home remain regular cinemagoers.  

Harvard Business Review released research this year showing Korean movie watchers who could view a movie on the big screen or wait only 30 days before online release still went to the movies. 

Movie consumption dropped less than a percent in Korea, despite an overlap between online availability and a big screen showing. 

Brown said: “Streaming is a parallel platform to cinemas, not competitive, just another platform to consume media or content through.”

Matsau does not think the level of at-home consumption seen during global lockdowns will remain at the same levels as economies and countries open up.

High audience numbers as movies open abroad is another factor giving local cinema companies hope.

Horror movie A Quiet Place Part II was recently released in the US and drew high audience numbers. 

Brown says: “The news from the US is that A Quiet Place Part II proved that the cinema business is still alive and well.”  

Matsau says the release of action movie Fast and Furious 9 “got a suitably furious start internationally a few weekends ago, with a $163m (R2.2bn) debut across only eight markets”.

China’s film industry has already grossed $3.7bn in 2021, just 1% behind the average of the three pre-pandemic years, 2017-2019, and more than 1,000% ahead of the same stage in 2020. 

But the pandemic has proved difficult for the SA industry, as audience numbers have been restricted to as low as 50 and curfews force screenings to end earlier.   

Ster Kinekor’s business rescue plan has been delayed three times, with the permission of creditors, as the practitioners wait to see how audiences react to soon-to-be-released big blockbusters, which are expected to draw crowds, before finalising it. 

Nu Metro also is undergoing a “responsible operational strategy”, in which they cut costs, negotiated lower payment terms with suppliers and have operated on a limited basis since August 2020.  

Some of their cinemas are only open from Friday to Sunday, on public holidays and during school holidays.

One of the biggest issues facing local cinemas was a lack of content as studios in New York and Los Angeles stopped producing content during the pandemic.  But this is no longer an issue for SA. 

Matsau said: “What we do know for sure is there is back-to-back content for the next 24 months.” 

He says he thinks about 15% fewer movies will be released on the big screen, with some smaller or niche movies going straight to online streaming platforms. 

Another reason for his optimism is the support of cinemas by production houses. Warner Media is releasing movies on the same day at theatres and online on its HBO Max channel. 

But in 2022 Warner Media will institute a 45-day delay between theatre and US online release. 

Disney is also instituting a 45-day window between movie cinema screenings and release to its US Disney Plus channel. 

Films make up to half their money on the big screen.

Commercial film studios need to keep the big screen going for financial success, said Matsau.

With audiences overseas watching movies in record numbers, delays being implemented between a movie’s release on the big screen and online and the drawcard of a night out, the industry feels the death of the cinema has been greatly exaggerated.  

Brown says: “It is also documented in history that cinemas, theatres and other live entertainment venues experienced a huge influx of customers after past pandemics, such as the Spanish Flu, or big world events such as wars or economic downfalls.” 

Matsau says: “I promise cinema will outlive us all.”