AMC CFO: ‘Not Seeing a Lot of Movement’ in Premium Video on Demand

Craig Ramsey says the cinema chain is open to exploring new windows, but not close to a deal

amc theatres
AMC Theatres

Studio execs from Fox’s Stacey Snider to Paramount’s Jim Gianopulos have recently been singing the praises of some form of premium video on demand (as this summer’s box office has endured a massive slump), but the world’s largest theater chain isn’t close to a deal yet.

At the Goldman Sachs Communacopia conference in New York, AMC Entertainment Chief Financial Officer Craig Ramsey said the exhibitor is talking with studios about some type of new window that would allow film producers to deliver first-run movies to consumers at home sooner — and for a higher price. But a deal is hardly imminent.

“We’re not seeing a lot of movement,” Ramsey said. “We’re still in conversations. I think it would be a stretch to say that we’re actually negotiating around a solution. But we’re still in conversations.”

However, Ramsey said AMC is amenable to working out different windowing arrangements for various types of films, believing that a one-size-fits-all strategy may not always make sense.

“We believe that there’s not a fixed window that’s the same for every movie,” Ramsey said. “It doesn’t really make sense for $30 million movies and big blockbuster movies [to have the same window].”

“The windowing strategy is something we’ve been very willing to talk about as a potential solution,” he continued.

But at this point, Ramsey said there hasn’t been an arrangement for premium video on demand that would be the right decision for AMC, which is owned by China’s Dalian Wanda Group.

“We haven’t really seen a proposal we’d be interested in signing up for,” he said.

AMC released disastrous second-quarter earnings last month, with its stock dropping more than 25 percent in after-hours trading following brutal guidance the company released a few days before its call. The chain announced a cost-cutting plan, which included the liquidation of non-core assets like “Spotlight” studio Open Road, which AMC and partner Regal sold to Tang Media Partners for $28 million.

Ramsey said in-theater advertising company Screenvision Media, which AMC acquired a 20 percent stake in when it bought Carmike Cinemas, could be another asset on the chopping block.

The exec also touched on the summer box office disaster, which was down 17 percent compared with last year for the season and contributed to the loss of more than $1.3 billion in market capitalization for North America’s four largest exhibitors. Ramsey said some fatigue could have set in after a solid start to the year, but he refrained from providing guidance on when things might turn.

“I’m not a film guy in terms of projecting the sales of movies,” he said.

Ramsey also responded to a question about low-cost subscription service MoviePass, which the questioner said a “not insignificant” number of New Yorkers use to attend movies. AMC issued a scathing release after the service dropped its price point to $10/month, calling it “not in the best interest of moviegoers.”

He said AMC supports the idea of a subscription service, but the issue with MoviePass was its price point, which he said is “not sustainable.”

“We believe in subscription,” Ramsey said. “At some point, we’ll be there on our own.”