Tom Lesinski, CEO of leading in-theater advertising firm National CineMedia, expects a strong comeback for the movie business, especially by the fourth quarter, and only “few and far between” Trolls-style windows experiments.
“I think studios want to have their movies showcased in theaters, where they belong,” Lesinski said during an online appearance Wednesday at J.P. Morgan’s annual media and tech conference. “I’m sure there will be tests that go on, few and far between.”
When major circuits AMC, Cinemark and others reopen this summer, “movies will come back slowly,” Lesinski said. July, which currently features Warner Bros.’ Tenet and Disney’s Mulan on the slate “could be the beginning of the rebirth and the reintroduction of movies into consumers’ minds and hearts.” By the fourth quarter, “you’re going to see consumers really embrace the experience.”
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Cases like Trolls World Tour, which touched off a furor among exhibitors by skipping theaters and going straight to on-demand and streaming, will be the exceptions, Lesinski added. Comcast has “a big broadband and cable business that supports streaming,” giving it more incentive to try to alter windows. Transactions for the Trolls sequel were “artificially high” due to the fact there was no other venue where customers could watch it. Discussions on changing the traditional 90-day theatrical window “have been going on for 25 years now,” the exec shrugged.
Lesinski was an exec at Paramount and Warner Bros. before taking the reins last year at National CineMedia, which controls two-thirds of the roughly $800 million annual U.S. market for in-theater ads.
Financially, NCMI has had to make sudden cost-cuts along with most other businesses as the shutdowns related to COVID-19 took hold. Lesinski nevertheless believes the company has “at least 18 months of runway even if we generate no revenue or theaters are closed for a long time.”
As far as core advertising, national buys should return more quickly than local ones. But the NCMI pitch that movie theaters are a prime venue for brand messages may gain traction during 2020, Lesinski said. “The television business is going to be in rerun mode and news mode for a long time, while movies continue to be fresh,” he said. “If movies flourish, especially in the fourth quarter, we may wind up getting more than our fair share of advertising.”
Streaming, while a dominant force this spring, will fade as people “get to the end of their queues” and feel “cooped-up” and ready to go out to theaters, the CEO said.
In terms of geography, Lesinski said the density of cities like New York make it less likely their theaters will return quickly. The South, the Southwest and much of the Midwest “will come back faster,” he added.
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