The next year or so for the Film industry will probably be a fairly bleak situation with the after-effects of this COVID19 pandemic ensuring that delayed releases and a lack of consumer confidence bring little cheer to an industry that has suffered badly during the previous lockdown. Since March 16th, most cinema halls throughout the country have been closed, those who did operate after that date were subsequently closed down entirely by the time the PM made the choice to lock down the nation on March 21st. The exhibition, with high fixed costs and requiring clients to guarantee revenue streams, like the other hospitality and outside businesses, therefore have been left in a state of limbo. Harsh decisions will have to follow for several exhibition companies to make certain they can satisfy their cashflows with many already invoking ‘Act of God’ to make sure that leasing agreements can be made ‘Force Majeure’.
Along with these important losses which will come from an elongated period of closure, there’ll be a massive loss of confidence in the crowd who will see coming back to cinemas as a risky proposition in the present environment. This would certainly result in significant releases being pushed back a significant period to attempt and mitigate this threat, which would lead to reduced occupancy even if theaters would be able to reopen. Some clues can be viewed in the Disney-Marvel masterpiece which pushed back its movie ‘Black Widow’ a whole 6 weeks from May to November to make sure there are no repercussions of this pandemic by then. Now, this might be wishful thinking on their part but the logic is clear. This summer blockbuster period of 2020 is a write-off and many a theater business may well be with it.
This means that films which were due to hit theaters will not make their launch dates, meaning films perhaps a bit long in the tooth – take their place, and this could lead to audience apathy. Film-watching is a custom and this quarantine period has squeezed that habit from us and the movie industry will in many ways pay a direct consequence of the as box office occupancy levels are downgraded throughout the world for the whole of this fiscal year 2020-21. This ebbing of the movie watching habit though possibly a little sliver of a silver lining for a different component of the M&E business, one that’s been perfectly positioned to capitalize on the excess time millions have had to while away hours while sitting in home – OTT, and Television.
The past 3 months have seen unprecedented growth in the viewing of the television display. Some studies have indicated that TV viewing has increased anywhere between 8-15percent in certain areas and no doubt the other time is been taken by the development in streaming services such as Netflix, Amazon, and the recently launched Disney Hotstar. As yet, there are no statistics on exactly how much these services have gained in the past 3 weeks but without a doubt, they’ve been the significant benefactor of people being incarcerated at home. Whether these services are being seen via AVOD or SVOD, the hours of seeing have been hugely promoted with binge-watching becoming a standard through the night and day. Just how much this saved time online has caused a transformation from AVOD clients to SVOD, we’ll need to see but I’m under the impression that this has occurred in a significant number.
Certainly, though this is something which can readily be expected there’s a catch. That’s these services are of course also determined by new production and the more the quarantine continues, the slower the shipping of the new content will be. Disney has already announced that some of its marquee shows will be postponed as a result and it’s the same for other streamers also. Just how long the pandemic lasts may have a direct effect on how these new readers are kept by the OTT’s in the long term. The recession that will likely follow may also result in rationing of expenses in the family and entertainment such as OTT subscriptions, which may end but rationalized as well. Hypotheticals possibly, but not without some reason.
Is that a new standard for entertainment viewing even after Coronavirus is abandoned as a remote (hopefully) memory? Well, there isn’t any doubt that a number of OTT profits made will be lasting. As I said, the movie-going business may take the time to recuperate both in confidence as well as in articles, which would indicate that habits formed, may last and I would guess, that once somebody has bitten into that OTT apple, it’ll be tough to take it off. Everyone won’t remain but many conversions will be permanent. Television is not quite so lucky as an appointment pushed TV will continue to be the primary attraction and as individuals return to work, the excess time available to watch the idiot box is going to be taken away.