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TOPIC: Article about Clearance and legislating against it

Article about Clearance and legislating against it 06 Mar 2007 00:23 #14534

  • rufusjack
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I apologize if many of you have already seen this article. Interesting read
http://www.telegram.com/apps/pbcs.dll/article?AID=/20070305/NEWS/703050577/1116
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Re: Article about Clearance and legislating against it 06 Mar 2007 00:58 #14535

Here's for archival purposes.
<BLOCKQUOTE><font size="1" face="Verdana, Arial, helvetica">quote:</font><HR>
Movie industry practice limits small-cinema offerings

Antonioni bill would ban ‘un-American’ deals

By Matthew Bruun TELEGRAM & GAZETTE STAFF

WEST BOYLSTON— The violent mob saga “The Departed” was a box office hit and the toast of the Academy Awards, winning statuettes for Best Picture and Best Director.

It has also been a hit on DVD, the top-selling title the week of its video debut.

“The Departed” just arrived at West Boylston Cinemas, almost five months after its theatrical premiere — a little late for owners of the theater.


Theater owners Kevin and Carrie Broderick would have liked to show the movie months ago, but a contentious industry practice known as “clearance” denied them the chance.

Film distributors will allow exhibitors in a given region to claim exclusive rights to titles within competitive zones. For West Boylston, Showcase Cinemas North in Worcester has claimed those rights to most first-run features, according to the Brodericks. If Showcase is showing a film, they said, that theater will ask distributors not to give it to West Boylston.

The distributors go along, the Brodericks said, because they would rather keep the larger theaters happy to reap their percentage from the higher-priced tickets. As a result, smaller theaters suffer.

“It’s not fair competition,” Ms. Broderick said in a recent interview. “The consumer is not benefiting from us being left out of the ability to play first-run pictures. All we’re asking for is a level playing field.”

State Sen. Robert A. Antonioni, D-Leominster, said he is astounded by the practice, which he called “un-American.”

“It results in an entity like the West Boylston Cinema almost going out of business,” Mr. Antonioni said Friday. “You can’t have competition when both parties don’t have the same product.”

National Amusements, the chain that runs the Showcase Cinemas North, declined to comment on the issue last week. Local theater management also declined to comment.

After the Brodericks contacted Mr. Antonioni about the issue, the senator filed legislation that would make clearance illegal, punishable by a fine of $10,000 per violation. He said he was hopeful the issue will be the subject of hearings in the Legislature this spring.

“I don’t know how, exactly, they’d argue against this (legislation),” Mr. Antonioni said, blasting clearance as an uncompetitive practice. “It results in higher ticket prices. It puts the local theaters under hardship. It allows the big guys to close out competition.”

The senator said he suspects the more people hear about the industry’s practices, the more offended they will become.

“Everything is weighted on the side of the big movie chains,” he said.

The Brodericks have owned the five-screen West Boylston Cinemas since 2003. The theater, which boasts lower ticket prices than its neighbors in Worcester and Berlin, has always shown “second run” titles, but in the past only had to wait a few weeks after a film’s opening to exhibit it. With the abundance of multiscreen theaters in the region, however, chains are hanging onto films longer than ever.

Such was the case with “The Departed,” which West Boylston was not given until Showcase was finished with it, 19 weeks into its theatrical run.

“The Departed” has done well at West Boylston despite already being available on DVD, Mr. Broderick said, but it’s rare for a film to sell out once it’s available on video.

“People don’t want to wait 12, 13 or 14 weeks,” Ms. Broderick said.

Clearance is not just a local phenomenon, nor is it a recent development.

“This has been going on as long as film has been a business,” said Ian Judge, director of operations for FEI Theatres, which runs the Somerville Theatre in Somerville and the Capitol Theatre in Arlington.

Those theaters have been affected by clearance issues in the past from larger neighboring movie theater chains. At present, the five-screen Somerville Theatre is allowed to show first-run titles because the owners of the nearby Loews theaters “don’t care about the little guy,” Mr. Judge said.

But at the six-screen theater in Arlington, he said, titles being shown at the Kendall Square Cinema are not shared.

Mr. Judge said his company contacted the Motion Picture Association of America years ago about the practice but was told the group would not get involved.

Other states have tried to address clearance, Mr. Judge continued, but the practice — which appears to be a verbal instead of written tradition — has survived.

Mr. Judge, whose company has been in contact with Mr. Antonioni’s office, said the movie-going marketplace is big enough that large chains shouldn’t be muscling their smaller competitors.

“Is Showcase really that paranoid they’re really going to lose all that business?” he asked. “They don’t want to set that precedent.”

The previous owner of the West Boylston Cinema filed suit in 1998 against National Amusements and Paramount Pictures after being denied permission to show first-run movies, but that case ended in a settlement, the terms of which were not disclosed.

The National Association of Theatre Owners, a trade group representing exhibitors, did not return repeated calls in the past two weeks for comment on the issue of clearance.

Clearance still confounds the Brodericks.

“I can’t see Wal-Mart saying to Pepsi, you can’t sell Pepsi at any store within five miles of my store,” Mr. Broderick said.

A summary of Mr. Antonioni’s legislation said several cinema chains take part in the practice, affecting independent theaters in Millbury, Arlington, Somerville, Belmont, Danvers, Franklin and elsewhere.

“This practice severely limits consumer choice,” the legislative summary reads. “It results in higher ticket prices in certain markets and puts many of our local community theaters in financial hardship, sometimes resulting in closure. In short, ‘clearances’ on first-run movies give the major motion picture distributors an opportunity to close out competition.” <HR></BLOCKQUOTE>

I don't see them getting anywhere, although the state's involved, so maybe I'm wrong...

Hopefully they do get somewhere though.
Since 1987
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Re: Article about Clearance and legislating against it 06 Mar 2007 01:26 #14536

  • reelman
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The National Association of Theatre Owners, a trade group representing "national chain" exhibitors, did not return repeated calls in the past two weeks for comment on the issue of clearance.

Fixed that part of the article. NATO will never come out and say anything against the big boys.
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Re: Article about Clearance and legislating against it 06 Mar 2007 02:02 #14537

  • sevstar
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We contacted NATO a couple years ago on a clearance issue with a location we had at the time. May as well been talking to a brick wall. That is when we learned they were worthless for any studio/distributor issues.
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Re: Article about Clearance and legislating against it 06 Mar 2007 08:35 #14538

  • slapintheface
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Are there any states were clearence is illegal?
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Re: Article about Clearance and legislating against it 06 Mar 2007 09:38 #14539

  • Narrow Gauge
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What's this? You mean NATO didn't reply? I am shocked, apalled, speechless-our beloved trade orginization run amuck.
What I find interesting is that the studios can in effect boycott certain theaters but our trade orginization can not (due to legal issues) boycott the studios.
How can this be changed?
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Re: Article about Clearance and legislating against it 06 Mar 2007 11:08 #14540

  • RoxyVaudeville
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It's sad to say, but this legislation, even if enacted will not stand. Pennsylvania passed the Pennsylvania Motion Picture Fair Trade Practices Law way back, I believe in the early 80s, which included an article that required a limit on the time that a picture could be held exclusively by the first theatre to play it. After 42 days the film had to be made available to other theatres in the area. The studios argued against this on the grounds of copywrite infringement. The courts agreed, saying as copywrite owners the studio has the right to sell its product to whomever, however, and whenever it wants to.

PERIOD!
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Re: Article about Clearance and legislating against it 06 Mar 2007 12:45 #14541

  • BurneyFalls
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I can see the courts rationale in that, but it seems to me like the studios would stand up against the big boys a little more to get make their product available on more screens, especially after the big chains had played several shows a day for several days.
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Re: Article about Clearance and legislating against it 07 Mar 2007 07:38 #14542

  • muviebuf
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Similar legislation in Pennsylvania was struck down by the Third Circuit Court of Appeals in the mid 1990's.

Pennsylvania had a stature enacted in 1986 which required the studios to make a picture available to any theatre which anyone wanted to play it after the first 6 weeks of a picture's release.

Using the PA statute the small twin screen art house Roxy theatre in Philadelphia sued Miramax (in its pre-Disney days) for licensing its pictures only to the Ritz chain of art house theatres. I believe the case was called Oracon II (or something similar) vs. Miramax. The case proceeded to trial where a Federal District Court jury found in favor of the Roxy and against Miramax to the tune of approx $130,000.00 in damages.

On appeal to the Third Circuit, the Third Circuit Court of Appeals overturned the judgment against Miramax and held that the Federal Copyright Act superceeded state law and allowed the studios to license their product any way that the studios deemed fit. The appeals court struck down that portion of the 1986 PA law which dealt with licensing and clearance issues.

[This message has been edited by muviebuf (edited March 07, 2007).]

[This message has been edited by muviebuf (edited March 07, 2007).]
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Re: Article about Clearance and legislating against it 07 Mar 2007 13:04 #14543

  • BECKWITH1
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This is precisely the reason why our 4 screen will go dark sometime in the next few months. Cinemark is building in the same town. We will be unable to get first run films and will have no possible chance of paying our rent on the business that is left at the end when they are done running a film. I've been reliably informed that Cinemark is absolutely the worst to run behind as they will ask for and get clearance against us.
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Re: Article about Clearance and legislating against it 07 Mar 2007 15:09 #14544

  • slapintheface
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so ROXY what will you do?
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Re: Article about Clearance and legislating against it 08 Mar 2007 00:49 #14545

  • BurneyFalls
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Sorry to hear that Beckwith. That is just not right.
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Re: Article about Clearance and legislating against it 08 Mar 2007 02:26 #14546

  • RoxyVaudeville
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Quote: [so ROXY what will you do?]

I'll continue to run my theatre as it always has been run. As a very successful 2nd run theatre.

I hope you didn't think that the Roxy mentioned in the Miramax suit by moviebuf was this Roxy. No, not at all. This theatre has never been first run. It was a subrun when it opened in 1933 and has lived with clearences of all sorts ever since.

I would never want to be first run. It would destroy this theatre. Why on earth would I want to compete headon with AMC, Regal, Carmike and now Rave. They can beat each other up all they want to get the first run customers. I have my own audience that has been established over the past 74 years. They are loyal to this theatre. There are many weeknights that I have more patrons in my single screen theatre then they have in their entire 12 to 16 plexes total.

I continue to hear many people in the industry say that subrun is dead. Last year was the best year I ever had, and I've been running this theatre now for almost 37 years. If you find yourself in the position where due to new competition you will lose your first run product, as unfair as that may be, don't throw in the towel without trying another policy. Try art or subrun. Whichever one is underserved in your area.

Allow me to point out though that changing to subrun requires a somewhat different approach in theatre management to be successful. You can no longer assume that the "picture is the thing". You have to make your theatre just as important as the picture. It must become a destination point. A place that people really want to go to. Something special. Something unique. The one ingredient that is usually missing in most first run multi-plexes will need to be your most important component... SHOWMANSHIP!
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Re: Article about Clearance and legislating against it 08 Mar 2007 04:20 #14547

  • HollywoodOz
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And cold beer doesn't hurt.
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Re: Article about Clearance and legislating against it 08 Mar 2007 10:07 #14548

  • rodeojack
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And cold beer doesn't hurt.

Couldn't agree more!

Unfortunately, Most people drive to and from a theatre. It wouldn't surprise me that the theatre would be included in any lawsuit over a customer who had an accident after leaving. The customer might have had only one beer at the theatre (and 6 at a bar beforehand), but it wouldn't matter. The theatre owner would spend a lot of money to prove it.

There's a drive-in theatre in Florida that serves up an ice-cold beer... really good with their pizzas. I've had a couple, when I've been down there... just to say I did... and I really enjoyed it. But I'd never serve beer at my own place.

Chicken?... Yah!

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