John Partilla, Screenvision CEO, joins Yahoo Finance’s Seana Smith to discuss what to expect from the movie industry in 2021 as it faces increasing competition from streaming companies.
SEANA SMITH: COVID disrupting the movie business this year, with ticket sales declining-- get this-- 80%. So for more, we want to bring in John Partilla. He's the CEO of Screenvision. It's a cinema advertising company.
And John, great to have you on the program. Your company or your business clearly impacted by the COVID pandemic over the last 10 months here in the US. How have you navigated this extremely difficult time, not only for your business but your industry at large?
JOHN PARTILLA: Yeah. Thanks for having me, by the way. And happy new year as we bring this year to a close.
It's been a brutal year with the pandemic for the movie industry and all things derivative of that business. As you said, it's down 80% from the box office of about $11.4 billion in 2019 a year ago to about $2.2 billion. And how we're navigating is I think is everyone's trying to pivot, and just survive, and to pivot into what will be, we hope, a more positive and strengthened slate in '21.
SEANA SMITH: John, talking about pivoting to a stronger slate and getting people back in the movie theaters, that screen that we have up right now, it shows that we haven't gone back above $100 million in the box office in any month since March. I'm curious just when do you expect that we'll get back above that level.
JOHN PARTILLA: I think we'll see a pretty choppy still Q1 in the business. I think there will be movies. And I think we'll have about 50% to 60% of the movie screens in the US open for business. But I think we really see a return to the business somewhere in the April, May period.
We're very hopeful, by the way, that in April, the Bond movie, "No Time To Die," will remain on the slate. That's in early April. And then we've got "Black Widow" coming in May, part of the Marvel Cinematic Universe franchise. So our prediction is somewhere around April, May, we'll really see the business starting to strengthen.
SEANA SMITH: And when we talk about where we stand right now, I mean, this has dragged on a lot longer, I think, than people initially anticipated. Less than 40% of theaters across the US are opened at this point, all of them here operating with limited capacity. How at risk are some of these movie theaters at closing here before we do get to the other side of this pandemic?
JOHN PARTILLA: It's been rough, right? I mean, I think that everyone has been doing their best to hunker down, preserve cash, do what's right for the health and safety of the US and the customer base that goes to movie theaters. But it's been tough to have a business where there's no product, and there's no one showing up, and rent is still due.
There has been recent news with the bill that was signed, as we know, recently under a program called Save Our Stages, which was a $15 billion allocation within that bill, almost a trillion dollars, of which we feel about $5 billion of that may be allocated into the cinema business. And so we feel that will be helpful to the midsized operators and the independent operators that could benefit from that signing of that bill.
SEANA SMITH: John, another thing that's interesting here when it comes to COVID, it's really accelerated some consumer behavior, some trends that already existed within industries. When it comes to the movie business, I mean, it's been streaming. Streaming has really taken off here over the last several months. We heard from Warner Media how they are debuting their movies in the month of January simultaneously in theaters and also making it available on HBO Max. Is this the start of a bigger trend, in your view?
JOHN PARTILLA: You know, I think the jury's still out. I think it's been a good deal of experimentation this past year, as you would expect with, obviously, theaters shut down for the most part. It's a good opportunity, I think, for studios with their streaming services to experiment with different types of practices.
And I think what we're seeing is-- you mentioned, obviously, HBO Max, part of Warner's. I think they have been sort of at one end of the continuum with some of their recent announcements on trying to simultaneously, in '21, release movies as well as those properties into streaming. On the other end of the continuum, though, we've got Disney, which had their earnings call a few weeks ago and very emphatically stated, listen, we value the theatrical window, as well as streaming. For us, it's not or, it's and. And that's where Disney came down on the other side of the continuum. So they're really valuing and protecting the theatrical window, while they also continue to experiment with streaming.
So I think we'll see a bit more of this experimentation certainly through Q1 with most of the studios. And then I think as we come out of Q1, I think we'll start to see, again, that sort of integrity of the theatrical window before things are released into streaming for the most part-- certainly, the larger titles.
SEANA SMITH: John, with the rise, though, of streaming, does that alter your business strategy at all or how you look at potential opportunities within the industry?
JOHN PARTILLA: Yes, for us-- thank you for asking that question. We continue to feel that the cinema advertising business is the center of the plate for Screenvision Media. It's a terrific business. We get to advertise with that audience across that giant canvas of a screen as people sit before the movies begin. And that's a very unique asset and platform for us. But we have also been pivoting and beginning to sign up new alliance partnerships with different kinds of out-of-home assets, and properties, and platforms that we can also display advertising on as well.
So for us, we still have our cornerstone, center of the plate, which is cinema advertising. But we have been moving into adjacencies such as bar networks. We've moved into doctors' offices. We've moved into echarging stations with screens. So there's been some various other experimentation. And you'll hear some more about our foray into sports stadium advertising as well in upcoming months. So we have been pivoting as well.
SEANA SMITH: John Partilla, CEO of Screenvision, happy new year. We wish you all the best. Thanks for joining us today.
JOHN PARTILLA: Happy New Year. To a better year ahead. Thank you.