New York is set to reopen its movie theaters on October 23rd at a reduced capacity. Yahoo Finance’s Dan Roberts shares how movie theaters and the entertainment industry are faring amid the pandemic.
ADAM SHAPIRO: Dan Roberts joins us now because AMC Theatres-- we know they're in trouble. But they're getting a little bit of a reprieve in parts of New York state. Tell us about that.
DAN ROBERTS: Yeah, that's right, Adam. Theaters are going to be allowed to reopen in New York state, just not in the city. And of course, that still hurts to not have New York City as well as California, where movie theaters are still not operational. But it's worth mentioning that countrywide now, AMC has 500 of its 600 theaters reopened in some form. Now of course, it's only allowed to have 25% capacity.
I happen to be someone who feels comfortable doing this. You wear a mask. I've gone to a couple of movies during the pandemic-- not at AMC theaters-- and boy, there's barely anyone there. I mean, 25% capacity in a place like a movie theater, you notice it because you've got a whole row to yourself.
Now AMC, as you mentioned, just a week ago filed with the SEC warning of the possibility that the company will run out of cash before the end of the year. So that is pretty dire, and already about six months ago the company had to get some bridge financing to stay afloat. So this is a lifeline in some form or another, but it depends really on whether people are comfortable going, you know. Reopening theaters in upstate New York-- well, that doesn't really help if people don't go see movies.
Of course, "Tenet" already happened, but currently "Wonder Woman 1984," that's scheduled for Christmas Day. So the hope is now that it will actually keep that theatrical release date. It's also worth mentioning, if you remember way back at the start of the pandemic, we talked about how well "Trolls World Tour" did-- that was a Universal movie-- by going direct to digital. They charged $20 for a digital rental.
After that dust up, AMC cut a deal with Universal where they said, OK, you have to show your movies in our theaters first, but we'll just do 17 days, then you're allowed to put it on digital. So they're also optimistic that the next Universal movie, which is "The Croods 2," is going to go to theaters for 17 days. That is, it stops Universal from being able to just skip the theatrical release entirely. So sort of good news for theaters, but the real question is with cases rising in a lot of areas, are people going to actually jump and go?
JULIE HYMAN: You're not chomping at the bit to see "The Croods 2," Dan, I take it?
DAN ROBERTS: [LAUGHS]
JULIE HYMAN: I think our local theater in here in upstate New York is looking to do the "Rocky Horror Picture Show" around Halloween, so that could be fun. AMC also getting creative, and there are reports that it is renting out entire theaters if people want to rent them. But it's-- I saw was $99, which I wonder if that's even worth it for them.
DAN ROBERTS: Well so there's a little bit of fine print there, and it's worth mentioning. Alamo Drafthouse had been doing this at the start of the pandemic. This is not an AMC only idea. Cinemark is doing this. But you see the headlines that say $99 rents out a whole theater. Well, then there's a $250 fee if you want to bring your own food, which I imagine you do. Now you can't grill in the theater, but there's a couple other fees involved.
That said, you want to bring a big group and watch "Tenet," or you want to bring a big group and watch "Rocky Horror," "Jurassic Park," any kind of classic-- "Gremlins," whatever you want, depending on the number of people, you divide it up, pretty good deal. And I do think it's a sign of just how desperate the situation has become for theaters. I mean, look, if there's so many screens that are closed anyway, they'll take the $99, right?