NBCUniversal CEO: VOD Will Be ‘Complementary’ Not ‘Replacement’ for Theatrical Releases Post-Pandemic

“It’s not realistic to assume that we’re not going to change,” Jeff Shell says, following AMC and Cineworld backlash to “Trolls” streaming release

Last Updated: April 30, 2020 @ 3:12 PM

Following backlash from theater owners after Universal said it would continue to release movies to on-demand streaming platforms, NBCUniversal CEO Jeff Shell said Thursday that premium VOD debuts will not be a “replacement” for the company’s theatrical releases in a post-pandemic world — but a “complementary element” in distribution.

“I’ve spent a big chunk of the last decade in the film business and there is no question that theatrical is someday again going to be the central element to our business and the film business itself and how people make their movies and how they expect their movies to be seen,” Shell said during NBCUniversal parent Comcast’s earnings call Thursday.

“But the flip side is the majority of movies, whether we like it or not, are being consumed at home and it’s not realistic to assume that we’re not going to change, that this part of the business is not going to a change like all parts of the business are going to change,” he added.

Universal on Monday announced plans to skip a theatrical release for Judd Apatow’s “The King of Staten Island” and release the comedy on demand in June instead — but it’s unclear if the studio intends to release movies in theaters as well as home entertainment platforms simultaneously. At the least, he signaled an interest in challenging the existing window of roughly three months that studios and exhibitors have long maintained.

“The question is, when we come out of this, what is gonna be the model? And I would expect that consumers are gonna return to the theaters and we will be a part of that. And I also would expect that PVOD is gonna be part of that offering in some way,” he said. “It’s not gonna be a replacement, but it’s gonna be a complementary element and we’re just gonna have to see how long that takes and where that takes us.”

This week, AMC Entertainment announced it will no longer screen Universal Pictures films following an interview with Shell published by the Wall Street Journal Tuesday in which he touted the impressive $95 million “Trolls World Tour” made in digital rentals in the 19 days since its release — and suggested that future movies might be released in theaters and on home entertainment platforms. That’s something that movie theater chains have long resisted. Regal Entertainment owner Cineworld Group also signaled that it objected to playing movies that did not honor the existing window for on-demand release.

“Trolls World Tour” was initially planned for theatrical release but was moved to day-and-date with a digital release in March as thousands of theaters were forced to shut down during the coronavirus pandemic. “I couldn’t be more pleased with the numbers,” Shell added during the call about the animated sequel’s VOD performance. “It provided consumers with a product that they desperately needed at home, particularly if you have a bunch of 7-year-olds and 5-year-olds running around. And it was good for our employees and kept them working on something and gave us an ability to make some money on something that we were proud of.”

While Universal decided to release some films on digital platforms, bigger-budget tentpoles like the “Fast and Furious” sequel “F9” and “Minions: The Rise of Gru” were pushed back to 2021. “We really had a choice: Do we delay those movies to a time when we think theaters are gonna be back open again, we did that with ‘Fast’ and ‘Minions'; do we sell them or movie them to streaming, some of our other competitors have done that; or do we try something new to preserve the premium nature of movies, and that’s how we came up with the PVOD offering,” Shell explained.

Comcast reported its first-quarter 2020 earnings earlier Thursday. Readers can find the results here.

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